The irrational and abnormal increase in Visa cost to USA has generated a stock market crash in India. The market has perceived that the profitability of Indian companies would be adversely affected due to the increased VISA expense assuming that it is always absorbed by the Indian companies.
We need to get a disclosure from every tech company doing business in USA and sending their employees to work in USA to quantify the VISA related expenses and how their contracts have been structured.
It is unfortunate that most of these tech companies built their business model with a dependency on “Serving” the US companies and did not try to develop indigenous capabilities in areas such as the Operating systems development or even Social Media services. Most of our big companies were happy with “Manpower supply” rather than product development. Otherwise like manufacturing companies who are able to take advantage of the GST reduction to boost their local sales affected by the US tariff, they also could have switched to Indian markets.
India currently have one weapon in the form of DPDPA and we all know that all big Tech companies including Microsoft and Google have been collecting personal data far beyond the requirements of their service. Microsoft is even siphoning off all documents created by us using Office and Google has its own collection mechanism. Meta is way ahead of others in permission less personal data collection.
But the lack of substitute services is making it difficult for Indian consumers to switch over. When KOO was being promoted as an alternative to Twitter, Naavi.org had urged Mr Narendra Modi and the Ministers to switch over from Twitter to KOO. But the power of “Swadeshi” in digital/social media was not appreciated by even Mr Modi who has now given a call to the manufacturing sector and consumers of physical products to turn Swadeshi.
It is time now to turn our attention in building indigenous digital facilities so that consumers can switch to swadeshi digital products. Companies like Infosys, TCS etc have enough talent to build the Indian digital infrastructure if they are prepared to shun their “Videshi Vyamoh”.
Government needs to introduce a strict Data Localization under DPDPA and ITA 2000 applicable to both personal and non-personal data. Where time is to be given, India should impose “Withholding tax or Export Duty” for data transferred out of India and give the option to all IT companies both Indian and others to either pay the withholding tax or localize the data in India.
Government should encourage setting up of “Gift City” kind of special zones where the tax structure can be made like a “Free Trade Zone”. I urge Mr Chandrababu Naidu to set up one such zone in Andhra so that industries exiting from Karnataka can switch to Amaravati.
We are aware that Russia has created a “Digital Iron Dome” so that no data goes out of the country except under the control of the Government. We need to set up a similar “Digital Data Funnel” to ensure that the Export Duty Collection can be efficient.
We are aware that China has developed its own OS and Social Media platforms. India needs to do the same. In the immediate future we should adopt OS systems like ZORIN and Office substitutes like Libre office or Apache Openoffice or OnlyOffice.
Ordinary consumers may require some handholding to switch over to these systems and the integration service may be provided by the Indian Companies. If Infosys and TCS are not interested, other startups can provide these services. I am sure that the companies like OLA (Refer article Kudos to OLA..for standing up on Principles) can be encouraged to take up responsibility of accelerating the transition. There are already companies who have substitutes for WhatsApp. I am sure JIO can develop a substitute for FaceBook, Instagram and WhatsApp if encouraged.
I was disappointed that in yesterday’s national address, Mr Modi did not address the correction measures required for the Digital Industry which will be affected by the VISA fee hike just like tariff on manufacturing companies.
We need MeitY to develop a policy separately to counter the VISA effect on Indian Tech Companies. NASSCOM today is a pawn in the hands of the US based Tech Companies. We need to first have a Indigenised NASSCOM to take care of interests of Indian companies. Either NASSCOM should transform itself or a separate association of Indian IT Companies need to be developed.
Can we see some initiatives from MeitY in this regard?
Naavi
