2025, Vol. 7, Issue 8, Part A

Author(s): Vivek Kumar Gupta

Abstract: The exponential growth of digital technologies, coupled with increasing cross-border data flows, has positioned data as a critical economic, strategic, and security asset. In this context, data localization has emerged as a central policy tool for India to assert digital sovereignty, enhance cybersecurity, and safeguard the privacy of its citizens. Data localization mandates the storage and processing of certain categories of data within national borders, allowing governments greater oversight and control over sensitive information. However, such measures raise complex questions about global trade, cross-border digital commerce, foreign investment, and compliance with international data protection norms. This paper critically examines India’s data localization initiatives within the broader legal, economic, and technological landscape. It explores the objectives of these policies, including protection of personal data, prevention of cyber threats, promotion of domestic data infrastructure, and alignment with international privacy standards. The study also highlights the challenges posed by stringent localization requirements, such as increased compliance costs for multinational corporations, potential restrictions on cross-border innovation, and tensions with free trade commitments under agreements such as the World Trade Organization (WTO) and emerging digital trade frameworks. Through a comparative analysis of global approaches, including practices in the European Union, the United States, and China, the paper identifies best practices and potential pitfalls for India in balancing privacy, security, and economic competitiveness. Furthermore, it evaluates the legal and regulatory frameworks underpinning data protection and localization, including the Personal Data Protection Bill and sector-specific mandates, while assessing the effectiveness and practical implications of these measures.

Pages: 36-45 | Views: 278 | Downloads: 149

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