India plans to require e-commerce, social media companies such as Google Facebook to store data locally

According to media reports, a draft policy document that Reuters saw showed that India is considering setting up a separate regulatory body and enacting legislation to address all e-commerce-related issues in the country, eliminate the current legal fragmentation of the industry.

Some of the measures proposed in the National Policy document include local data storage, mandatory use of the domestic card payment network Rupay for online transactions, and promotion of online, retail services for micro, small and medium-sized businesses.

The document also stated that India would also take measures to develop data storage capabilities and encourage the storage of data in India. The paper also indicated that it would give time for the e-commerce industry to “adjust before localization becomes mandatory.”

The draft policy states that “in compliance with privacy, licensing and other relevant regulations, the Indian government will have the right to store data in India to achieve national security and public policy objectives.”

The document said that Indian antitrust regulators would consider changing the entry rules for foreign investment to a mandatory review of mergers and acquisitions in the e-commerce market that may distort competition.