49% Indians want Chinese firms to assure no sharing data with China: Survey

The survey conducted by LocalCircles also says that action should be taken against the Indian companies with higher Chinese ownership and the Chinese directors must resign.

Data protection Bill
The Indian Government early last week banned 59 Chinese apps including TikTok, CamScanner and WeChat in the interest of national security.
Peerzada Abrar Bengaluru
4 min read Last Updated : Jul 07 2020 | 11:39 PM IST
About 49 per cent of Indian citizens say Chinese companies should be allowed to sell products in India only after they give an undertaking stating no personal or aggregate data of Indian customers would be shared with China and that all such information must reside in India, according to a new survey by LocalCircles.

In India, while personal data protection is to be governed by the Personal Data Protection Bill 2019, aggregate data is to be governed by the e-commerce policy which is still being drafted. However, a temporary undertaking solution could be implemented which prevents any data (related to sale, operational or processing) through products and services sold by an Indian corporate entity is retained in India, said the survey.

At a time of Indo-Sino tensions, LocalCircles conducted the survey to understand the citizen sentiments on Indian companies with Chinese investments and Chinese multinationals operating in India. The survey received over 19,000 responses from citizens while 3,341 responses were received from small businesses spread across 243 districts of India.

Over the last several years, hundreds of Indian companies have raised capital from Chinese investment firms or companies.

The first question asked in the survey was if any actions should be taken against Indian companies with Chinese investment. About 30 per cent of respondents said action should be taken only if the Chinese ownership is 10 per cent or higher, while 29 per cent said action should be taken on companies with any Chinese ownership.  About 27 per cent said no action should be taken on such companies but the Chinese directors must resign. Only 11 per cent said that no action should be taken against any such company. 
“Overall, people seem to be okay with not taking action against Indian companies with Chinese investments but want any Chinese directors to resign from the boards of such companies,” said the survey.

It is quite obvious that a majority investor (generally needed to get a board seat) can’t have their influence on the company, they would rather exit that investment by selling their stake to other interested parties. Such a move could lead to stake sale by the Chinese funds and companies, said LocalCircles. Chinese investment giants like Alibaba Group, Tencent, Steadview Capital and Didi Chuxing dominate investments in over 18 of the 30 Unicorn companies in India. Some of these include Bigbasket, Zomato, Delhivery, Byju’s, MakeMyTrip and Paytm, according to LocalCircles.

People were also asked if action should be taken against Chinese manufacturers selling products in high volumes in India. About 35 per cent said such sales should be completely barred while 14 per cent said they should only be allowed to sell ‘Made in India’ products. About 25 per cent said such companies should only be allowed to sell made in India products if no data sharing is taking place with China.

The Indian Government early last week banned 59 Chinese apps including TikTok, CamScanner and WeChat in the interest of national security. The ban was imposed under Section 69A of the Information Technology Act, citing privacy and security issues about data of Indian users being transferred to servers outside India without permission.

The LocalCircles survey also reached out to 3000 small businesses including small and medium enterprises and startups to assess the impact if economic ties with China were severed. The survey shows that small businesses are split on whether India should cut ties with China or not. About 27 per cent of firms said it will have a negative impact while 24 per cent said it will have a positive impact. A large number of Chinese imports are used as raw material for industries such as electrical machinery, pharmaceuticals, fertilisers and chemicals. A ban on Chinese imports will hurt all these businesses at a time when they are already struggling to survive in the middle of the economic slowdown and Covid-19 pandemic, according to the survey. Similarly, many startups were in discussions with Chinese investors to raise capital and practically most of those discussions have gone cold now.

Topics :Chinese firmsData PrivacyIndia China relations

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