To keep up with TikTok & Bitcoin, India needs innovation in lawmaking too

Currently, laws dealing with modern technology are either ad-hoc or not truly responsive to the challenges posed by such technology.

A wholesale stall selling mobile phone accessories in Mumbai | Dhiraj Singh/Bloomberg

From TikTok to Ola cycle taxis, regulation in India has always followed innovation. Any disruptive technology is met with reactive laws. For laws to be truly sensitive to innovation, there is a fair bit of innovation that needs to take place in the lawmaking process itself.

The old and new

In 1811, factory workers in Britain protested automation in textile factories and weaving machines. Automation was their enemy because it threatened their livelihood and treated them unfairly. This is one of the earliest recorded protests of worker groups—and came to be known as the Luddite movement.

They burnt factories, attacked government representatives and took matters in their own hands, hoping that they would be able to attract the state’s attention and keep their jobs. Two hundred years later, reports of partner drivers of ride-sharing apps resorting to violence during a strike are symptomatic of a larger trend—the disruptive influence of automation and innovation in the modern economy.

Historically, laws have followed innovation. Be it the labour law reforms in 19^th century Britain which were a response to poor working conditions of factory workers, or modern-day privacy laws, which are a response to data thefts and misuse, lawmaking is understandably a response to change. However, as technologies like AI continue to grow and expand into various sectors, it’s important to consider whether law-making should foresee innovation and guard against harms arising out of it.

Leaving room for innovation

At a time when unprecedented strides are being made in the way humans live, interact, and sustain themselves, consequences of innovation need to be identified and proactively dealt with. In particular, potential harms arising from such innovation need to be identified and responded to. Of course, mindless regulation for the sake of regulating would be undesirable.

A common dilemma that is being faced by governments and policymakers globally is striking the right balance between regulation and innovation. Policymakers must ensure that regulation protects user interests while also providing enough room for innovation to continue.

No smart laws

In the past decade, India’s regulatory responses to disruptive technology have been largely reactive. In the absence of a structured approach to regulation, many ad-hoc decisions turn out to be counter-intuitive.

For instance, the Karnataka government temporarily banned Ola from operating motorcycle taxis in Bengaluru. Ola had rolled out this service without requisite authorisation. Similarly, the Madras High Court imposed an interim ban on the TikTok app after it was found that pornographic content was being shared on the platform. The government recently announced a draft law on cryptocurrencies, which prescribed a 10-year jail term for mining, selling or storing cryptocurrencies like Bitcoin and Ethereum.

In each of these cases, authorities have resorted to banning disruptive products and services instead of engaging with stakeholders to understand their realities and challenges, and tailoring a suitable regulatory response.

Previously, government policy documents and draft regulations on Artificial Intelligence and intermediary liability have received mixed responses.

The reasons for these are two-fold— the inability of state actors to understand technology and the resultant lack of a coherent approach to regulation (absence of capacity and expertise); and outdated or inadequate laws that are incapable of keeping up with innovation (absence of smart law-making).

Bringing people in policies

The lack of capacity and expertise within the government is often addressed through internal and external interventions in the law-making process.

The government’s premier think-tank, the NITI Aayog, is one such entity providing expertise on some important questions, which lie at the intersection of innovation and regulation. State and local governments, however, do not have think tanks of this nature.

Domain experts and external entities are often consulted on law-making, but the process is ad-hoc. Further, law-making processes are often criticised for not being representative, participatory, or transparent.

At present, India does not even have an enforceable policy on stakeholder consultation on legislative processes. There is a greater need to develop a framework that enables more structured, collaborative and focused policy interventions within each level of government.

Policy innovation labs

Policy innovation labs are a possible route to achieve this goal. These labs are specialised units that can be housed within or outside the government.

They usually work on emerging issues of policy through design-oriented thinking, data-based approaches, and constant engagement with experts and stakeholders in the domain.

Policy innovation labs can ensure the following –

• policy-making within the government benefits from interdisciplinary approaches
• domain experts and civil society constantly weigh in on different stages of policy
•  citizen-state dialogue is promoted
• external interventions in policymaking are not ad-hoc
• recommendations made are independent and apolitical.

A few countries are already experimenting with policy innovation labs. Countries like the UK and many EU member states have labs that are working on waste management, innovation in the public sector, digital economy, transportation etc.

The UK Policy Lab, for instance, was set up as a part of a reform proposal to modernise the civil service. It’s a dedicated structure that works within the government to identify innovative solutions to systemic policy challenges. These labs are working closely with the civil service and key policy-makers to design and implement policies. In India, there is a need to introduce policy innovation labs that will provide the necessary expertise in emerging areas of policy. Such labs should be housed within identified ministries or departments of the central and state governments, and local bodies to provide substantive inputs on policies and their implementation.

The government should begin with identifying problem areas in the concerned sector for which legal or policy solutions need to be crafted. It should then identify existing entities as policy innovation labs or create new ones based on some predefined criteria— independence, absence of conflict of interest, presence of adequate expertise being key considerations. The government should work with the labs to ensure that all stages of law-making, from deliberations to actual drafting are representative, transparent, and participatory. The accepted recommendations of the labs can be used to frame a national policy on the identified issue.

Responsive law-making

For regulation to truly keep up with innovation, it is important that laws and the law-making process are tailored to contemporary realities.

At present, laws dealing with modern technology and sectoral innovation are either ad-hoc or not truly responsive to the challenges posed by such technology. Further, in many instances, citizen-state engagement is weak owing to physical and technological barriers.

There is a need to ensure that modern regulatory tools and responsive rule-making are activated in sectors like education, healthcare, digital economy, transportation, and public service delivery where technological innovation is at its peak or is warranted.

Akriti Gaur is Senior Resident Fellow and Arghya Sengupta is Research Director, Vidhi Centre for Legal Policy. Vidhi will release its Briefing Book titled ‘Towards the Rule of Law – 25 Legal Reforms for India, 2019’ at the India International Centre in New Delhi today.