Context:

• RBI last year mandated companies to store their payments data “only in India” so that the regulator could have “unfettered supervisory access”.
• The RBI will examine concerns around its strict data localisation rules that require storing of customer data exclusively in India without creating mirror sites overseas.

What is Data Localisation:

• Data localisation laws refer to regulations that dictate how data on a nation’s citizens is collected, processed and stored inside the country.

Significance of Data Localisation:

• Data localisation is critical for law enforcement.
• Access to data by Indian law agencies, in case of a breach or threat, cannot be dependent on the whims and fancies, nor on lengthy legal processes of another nation that hosts data generated in India.

What India can do:

• It may not be wise for India to have the liberal rules as developed nation.

Legislation backup:

• Only Mandatory rule on data localisation in India is by the Reserve Bank of India for payment systems. Justice Sri krishna Committee report – to identify key data protection issues in India and recommend methods of addressing them”.