Impact of ban on Chinese apps

Impact of ban on Chinese apps

Context:

* The Indian government’s move to ban 59 apps of Chinese origin.

* The Indian government has banned 59 apps of Chinese origin, citing data security and national sovereignty concerns. These include popular ones such as TikTok, SHAREIt, UC Browser, CamScanner, Helo, Weibo, WeChat and Club Factory.

* The government has invoked powers under Section 69A of the Information Technology (IT) Act read with the relevant provisions of the Information Technology (Procedure and Safeguards for Blocking of Access of Information by Public) Rules 2009.

* The government seems to have adopted the emergency route under Section 69A of the IT Act to issue ban orders. The emergency route allows content to be blocked on the directions of the Secretary, Department of IT, who must record his reasons for doing so.

* The order of the Secretary, Department of IT, must be placed before the government committee within 48 hours. Based on the recommendations of this committee, the order can then be finalised or vacated.

Reasons for the ban:

* The Ministry of Electronics and Information Technology has stated that its actions were based on reports and complaints about misuse of the apps for stealing and surreptitiously transmitting users’ data in an unauthorised manner to servers which have locations outside India.

* The Ministry has stated that the decision to block the 59 apps was to safeguard the sovereignty and integrity of India and protect data & privacy of the Indian users.

* The Ministry is also said to have received “exhaustive recommendations” from the Home Ministry’s Indian Cyber Crime Coordination Centre for the ban.

Impact on users:

* Installed apps may continue to exist on mobile devices. But now that the latest versions of the apps have been removed from Google’s Play Store and Apple’s App Store, users will not be able to access updated versions in future.

* If a notice goes out to internet service providers asking that data flow from these apps be halted, that could impact the functioning of existing, installed apps.

* The banned apps have a large user base in India. Users of banned browsers or video apps may shift to similar offerings from other apps.

Impact on Indian economy:

* The move to ban the apps could impact India in terms of investments and employment. ByteDance Ltd., the parent company of Tiktok had proposals of investments worth $1 billion in India. With the ban this will probably remain suspended, potentially impacting job creation.

Impact on Chinese app providers:

* It is most likely that the move was aimed at Chinese economic interests.

* The potential loss of advertising revenue impacts app-makers.

* Though TikTok’s Indian business yields cover a small proportion of its total revenue, but with quicker user adoption more recently, the stakes seem to be getting higher for the banned apps.

China’s response to the ban:

* China has claimed that India’s measure selectively and discriminatorily aims at certain Chinese apps on ambiguous grounds and runs against fair and transparent procedure requirements, abuses national security exceptions, and is violative of the WTO rules.

* China also argues that the move goes against the general trend of international trade and e-commerce, and is not conducive to consumer interests and the market competition in India.

Legality of the move:

* The legal order that empowers the designated authority to implement the ban is yet to be made public.

* Though Rule 16 of the Blocking rules requires strict confidentiality to be maintained regarding blocking requests, complaints received, and actions taken, the government ought to disclose the orders passed (subject to relevant redactions that may be required) in the interests of transparency and accountability.

* Also, and as recognised by the Supreme Court recently in the Anuradha Bhasin case, publishing such orders is the only way in which the reasons and rationale for the decision can be judged.