We must have protection. But there’s more than that. Is there a way to empower people to use their data to their own advantage? That’s really a whole new idea.
Unique Identification Authority of India (UIDAI) chairman Nandan Nilekani says that in this new era of ‘whole data’, India can lead the way and offer a new way of looking at it — using it to empower people.
Nilekani was speaking at the IDFC Institute Dialogues in Goa, and discussed a wide range of issues related to data.
Here’s an excerpt from his talk, edited for clarity:
My topic today is data empowerment and the opportunity state… How can people and small business use their own data to advance their life. I think you know in the last few years, we have seen the rise of whole data-based businesses — businesses that use data to sell you ads or so on.
But, increasingly, there is a lot more disquiet about what’s happening, and you know recently we had the whole case of Cambridge Analytica and the whole issue of the US elections. And clearly it is beginning to look like a Faustian bargain, where we give our data and we get ostensibly free services, but there are other implications which are now becoming obvious in the world.
This whole data trend is inexorable; we are only at the beginning of it. Today, we have 2.5 billion people on the planet who have a smartphone and when everybody goes…to a smartphone, the digital footprint they create goes up dramatically by order of 10 times.
And we are just at the beginning of the ‘internet of things’ revolution, where we are going to have sensors in everything. Your automobile will have sensors, your washing machine will have sensors, your Fitbit will have sensors and so on. The expectation is that we are going to have up to 50 billion sensors around the world, and that those sensors combined with the new 5G technology will allow you to have lot of intelligence.
The fact of the matter is that data is inexorable; the data avalanche, the deluge, the tsunami of data is a given, and we just have to figure out what we do with this thing. This has many implications: Social implications (we are seeing that in elections and so on), political implications, business model implications — how do you make money, and technological implications of what has to be done. This is not the situation which everybody has figured out. People are grappling with these issues and different parts of the world are grappling with it differently.
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All over the world, data is now the big question — in the US, in the UK, in the EU, in China, in Japan. Every country is trying to deal and cope with this whole data thing. And the strategic implications of this massive data deluge are still being handled, and people are coming to grips with what is required.
Four approaches
What we find is that there probably seem to be four approaches in the world to data.
In the US, by and large, it’s been a laissez-faire approach, and companies have been allowed to collect data and so on. Only now, there is some amount of questioning about what does this mean, and we are seeing the hearings at the House and so on. Therefore, people are beginning to question whether we need to look at a framework for privacy, whether we need to have a framework for fake news, whether we need to have a framework for anti-trust. You know all these questions are now being asked. So, I think the US is dealing with these issues.
The Europeans have been far more concerned about the issues, especially of privacy and competition, for a longer time. The culmination of their privacy journey has been the General Data Protection Regulation (GDPR), which came out on 25 May. For a long time, the USA said Europe is not able to create its own companies, and therefore they are using regulatory measures.
China has a very different response. As you know, there is a great Chinese firewall, which basically says ‘we don’t allow Western companies to operate’. So there is no Google, no Facebook in China. And you have domestic champions Baidu, Alibaba… There is a very close focus on national security. You have been reading about how there’s a face recognition camera at every traffic light… the whole concept of social credit score… the whole thing happening in Xinjiang province. So, there is a lot of stuff which is essentially national security-oriented and so on. So they have a different view. And there are very strong requirements of localisation. So if you are doing business in China, you have to keep your data on local servers. So, fundamentally, it’s a very different view of data. And there’s also a commingling of business and national security.
In India, we have a possible fourth approach. And a lot of that was thanks to Aadhaar. Aadhaar became a constitutional matter. It was argued whether privacy is a fundamental right, and then there was a judgment on the fundamental right to privacy.
So, really, we can think about four approaches: laissez-faire, regulatory oversight, national security and so on. And what we think we would like to call as the empowerment approach. In other words, India has the potential to offer a new way to think about data, which is not coming from any of these other three, but coming from the point of view of how we use data for empowerment.
Data for empowerment
Now, obviously, companies have known how to use their data for profit, countries know how to use their data for security. But can we think about how can individuals use their data for improving their life? That’s the whole theme here. In the meantime, India is going rapidly digital, 1.21 billion mobile connections, 1.2 billion Aadhaars issued, close to half a billion internet users. We have close to 600 million Aadhaar-linked bank accounts, which is the basis for the world’s largest cash transfer programme.
So think of this as the five layers of what is called as the India stack — identity, authentication, payments, signature and consent. All these are public goods, which means they are all available to every Indian. This is very important and very strategic, because there is no country in the world which has built these layers.
What this means is that India and Indians will go from being data-poor to data-rich within the next three years. As more people use phones, as more people use digital cash, as more people open bank accounts with KYC, their digital footprint is going up dramatically.
Now, it’s important to realise that your digital footprint is going up faster than your economic growth. What happened in the United States and Europe was that the new models for business models with data began after these countries were already rich, in the sense that per capita incomes in US or Europe (were) 40,000-50,000 dollars. And therefore, the business models that emerged were those that used data to sell to you.
(Digital) advertising in the US and Europe is a few hundred billion dollar market. But in China the advertising market is 50 billion dollars. In India, the digital advertising market is just 2 billion dollars. But on the other hand, the per capita income in India is 1,800-2,000 dollars. So, the digital footprint of every Indian is going to be the same as that of a Western person.
And therefore, if you are able to invert the data and put it in the hands of people so they can use it to improve their lives, they are actually using data as a lever for societal development. But to do that, you need infrastructure like this; and the infrastructure we have enables you to do that.
If you look at the global debate, all of it is about protection. Rightly so, because when you are generating massive amounts of data, the people who will have the earliest access to put that data to work is governments and companies. And therefore, a large part of the conversation is about how do we protect individuals against the data being used by companies or governments.
How do you ensure that you take their consent or make sure that the data is not used in a way inappropriate to what they have given their consent for? How do you hold companies accountable? How do you find companies so they don’t do the wrong things? How do you make sure that countries store data in a way that you don’t create surveillance?
A lot of the debate is about that, and rightly so. But we feel that it’s not just about that; it’s also about how we treat this data as a strategic thing for individuals and small businesses to use for their future. In other words, how can we use data for empowerment?
We need a new class of platforms, products, networks, laws that put the user at the heart of it and allow the user to use his data in a way that improves his life.
Legal framework
The Supreme Court has recognised the fundamental right to privacy. However, the state can constrain this in four situations: Protection of revenue, law and order, national security, and disbursement of benefit.
So, the court has given the framework, and said when you constrain privacy for these four reasons, it has to be accompanied by a law… That’s the framework they will use to judge whether something is going to be violative or not. And the first step of that framework is the Aadhaar case, on which currently judgment has been reserved. The Judgment should come before 2 October.
In the meantime, the Srikrishna committee is coming out with a law. So all these things that I talked about have been happening as we speak. And we believe that the law will emphasise data thought.
Of course, we must have protection. But there’s more than that. Is there a way to flip this around, and empower people to use their data to their own advantage? That’s really a whole new idea that is coming up.
Fundamentally, I think we are talking about going beyond the classical argument, which says ‘how do we protect people from their data being misused by companies or the government’. It’s a very valid concern, and therefore a lot of the work in privacy is about that. But let’s flip it he coin around saying, fine, we absolutely have to make sure that we have the right privacy framework. We absolutely have to make sure that companies are accountable for data. We have to make sure consent is taken for your data. We have to make sure the government uses your data properly.
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All that has to be given. But beyond that, given the fact that there is going to be this massive deluge of data which is going to come from…internet of things and all that, and that data is actually my data as a consumer, can I now have infrastructure, a technology, a business model, a law, which will allow me to use my data to improve my life? Get a better loan, get better job, get better healthcare, get better skills?
How can I do that? If you can do that, this becomes an instrument of development, actually leveraging data to move the country forward, so that the people have access to better services, better healthcare, improve their lives. That is what is happening in India. This immersion/emergence of data — not from a corporate or government point of view but an individual point of view — this requires technology, requires institutional business models and entities, it needs law.
The good news is all these things are falling into place, and you will see a significant use of this…in the next couple of years.
(Transcribed by Achyut Mishra and Regina Mihindukulasuriya)
Disclosure: Nandan Nilekani, the chairman of UIDAI and co-founder of Infosys, is among the distinguished founder-investors of ThePrint. Please click here for details on investors.