Silicon Valley’s worst nightmare: Made in India, by India

Silicon Valley’s worst nightmare: Made in India, by India

Silicon Valley tech giants, among them Amazon, Google and Facebook, are coming under increasing public, administrative, and national scrutiny over internal company policies that govern how they operate, locate, and expand.

The fallout from Amazon’s decision to ditch Queens New York for a new big data headquarters is still reverberating in the City, and all the way up the Hudson River Valley, past Albany. Out west, top CEOs, ‘tech workers,’ investors, and just plain ol’ San Jose locals are locked in an epic battle for the very soul of Silicon Valley.

It is no longer business as usual when it comes to the way big U.S. tech companies operate, locate, and expand their business operations. Not just in Silicon Valley, but around the world, and especially in hot, emerging tech markets, like India, where expert inside watchers are scrutinizing the latest government policies and wondering if India is turning its back on Silicon Valley?

Tech restrictions and tech exclusions of course are the stuff of the U.S.-China trade war. China is a place where ‘business as usual,’ has never existed for American, European and non-Chinese enterprises.

But until now, India has been a different story: The Next Big Shinny Thing; That rich, diverse, influential, emerging middle-class tech/business market; that alluring something Silicon Valley companies viewed as a prize they “want to win in India.”

The Jewel Silicon Valley desires so much, however, has never seemed so far away. The “Prize” so out of reach, elusive, or ephemeral. Never so much as in the months ahead and the run-up to Indian general elections this May.

With a stern eye set on checking the power of Silicon Valley, the Indian government has introduced a wave of sweeping regulations that bring government control and transparency to the ways and means that foreign companies handle, and make use of, Indian user data. These mandates also extend to other aspects of how online retail platforms operate, with greater oversight for technology platforms now enabled.

Experienced in the new India policies, close observers describe their engagements as “combative, with abrupt, disruptive policy changes that are being held without consultation, and, unusually, with absolutely no room for negotiation or even deadline extensions.”

As a result, if your business in India is not of domestic, the outlook is not so rosy. In fact, it’s looking downright hostile in some cases, leading some to conclude that indeed, India is turning its back on Silicon Valley; as explained in the VentureBeat article noted above.

But there is much more to the story than just the relationship between Silicon Valley, Bangalore, and other Indian tech hot spots. In India – and other places – national internet regulations regarding social and news media are becoming statute, law and the expected regional custom.

In the article we learn that “the Indian government began finalizing a regulatory directive detailing how it wants intermediaries (internet service providers, websites, apps, and services that rely on users to generate content) to operate in the nation.” It further specifies that “Any entity that has more than 5 million users in India will have to set up a local office and build automated tools to identify and remove harassing, hateful, and harmful content. (Some critics have likened the move to censorship in China.)”

The article covers the long, complicated backstory of the tech industry in India, and the more recent online history of data giants like Facebook and Amazon. It presages a coming age of tech sovereignty, or tech nationalism, complete with historical rhetoric.

Excerpts from the article enlighten and explain further:

“What we need to do is what China did (15 years ago)…tell the world ‘We need your capital, but we don’t need your companies’,” Many have argued that India (and other countries) should focus on building its own ecosystem of companies, instead of giving it all away to Silicon Valley giants. Vivek Wadhwa, a distinguished fellow at Carnegie Mellon University and Harvard Law School, recently argued such a case. Wadhwa said India’s recent moves are “steps in the right direction,” though he added that the policies need some fine-tuning.”

“Last month, Aruna Sundararajan, secretary of India’s Telecommunications department, told a group of Indian startups that the government was working to formulate a new “national champion” policy to encourage the “rise of Indian companies.” A secretary of Sundararajan declined to comment on this upcoming policy.”

“Nationalism à la China”

“Nationalism is the theme tying together all the policy changes the Indian government has unveiled in the past year. “All these moves are aligned with rising nationalism in the run-up to May 2019 and are often further aligned with, possibly driven by, specific lobbies who are simply riding the nationalism wave.”

“In his announcement before a group of merchants and government officials, one official said India needs to “collectively launch a new movement against data colonization,” similar to the movement Mahatma Gandhi led against political colonization of India. “For India to succeed in this data-driven revolution, we will have to migrate the control and ownership of Indian data back to India — in other words, Indian wealth back to every Indian,” he said, adding: “Honorable Prime Minister, I am sure you will make this one of the principal goals of your Digital India mission.”


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