Infosys co-founder NR Narayana Murthy on Tuesday said the issue of data localisation should be handled with flexibility as the country needs more jobs and better income.
"If there is a multinational company with very small business in India, for them to install all the paraphernalia required for localisation may not be possible. So these are issues we should be flexible about at this point of time as our top priority should be to create more jobs and more income," Murthy said at the 24th annual international conference of MobiCom or Mobile computing and networking.
The IT veteran highlighted the factors that are associated with localising data across sectors and companies.
"The policies on data localisation vary from company to company and from one sector to another," said Murthy, while adding that "in some areas, governments may mandate localisation of data, in other areas, it will depend on economies of scale."
Localisation makes it mandatory for companies to store and process important data about consumers within the borders of a country.
The Reserve Bank of India had issued a circular making it compulsory for payments-related data to be stored in India and had set October 15 as the deadline for compliance. It covered all card payment and digital payment service providers like Visa, MasterCard, Google, WhatsApp. However, many companies are yet to comply with the same.
While many large corporations argue that data localisation will hurt their businesses and will undermine the country's growth, some feel that the opposition could be due to the fact that data localisation will force the online service providers to come within the Indian tax net. If a fintech company stores data locally, it will have a fixed place of business in India, which also means that its income from Indian customers will become taxable in India.
First Published: IST