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Indian Economy

Digital Trade

  • 26 Jul 2019
  • 5 min read

According to a digital trade report released by Hinrich Foundation (a philanthropic organization) and the All India Management Association (AIMA), digital trade is likely to create Rs. 3,331 thousand crore economic opportunity for India by 2030.

  • Digital trade encompasses digitally-enabled transactions of trade in goods and services that can either be digitally or physically delivered, and that involve consumers, firms, and governments.
    • Example includes purchase of a book through an on-line marketplace, or having an online access to some data.

All India Management Association

  • The All India Management Association (AIMA) is the apex body for management in India with over 37000 members and close to 6000 corporate /institutional members through 68 Local Management Associations affiliated to it.
  • It is a non-lobbying, a not for profit organisation, working closely with industry, Government, academia and students, to further the cause of the management profession in India.
  • It is located in New Delhi.

Key Findings

  • The report also predicted that value-added to India’s domestic sectors through digital trade could grow over 14-fold by 2030.
  • The export value of virtual goods and services enabled by the digital economy, such as e-commerce, account for $58 billion in 2018-19, making it India’s second largest export sector.
    • In such a scenario, it is estimated that India’s digital exports could grow by 238% from today’s levels to touch $197 billion by 2030.
  • Digital trade can enable Indian firms to reduce the cost of storing data, improve business practices, generate richer business insights, and enter new markets.
  • Digital trade can also facilitate the more efficient management of global supply chains (e.g. tracking of export containers using Internet of Things technology).
  • Many countries are adopting digital trade rules that could undermine the digital trade opportunity for India.


  • India is contemplating an umbrella legislation on data protection. A 10-member expert group headed by former Supreme Court judge B.N. Srikrishna has submitted the draft Personal Data Protection Bill, 2018, to the Ministry of Electronics and Information Technology. The committee has recommended setting up of a data protection authority and placing restrictions on cross-border data flows.
  • India is also opposed to joining any global deal on e-commerce with the Prime Minister refusing to sign the Osaka Track, an overarching framework promoting cross-border data flow, at the recently held G-20 summit.
  • Many businesses, particularly small and medium enterprises (SMEs), often lack the resources to research international sales opportunities, build global business networks and promote their products overseas.

Steps to be Taken

  • To maximise the positive impact of digital trade, issues such as undue red tape on digital enterprises, restricted cross-border data flows, and imbalanced copyright and intermediate liability regulations, need to be addressed.
  • Good regulatory frameworks are essential to address issues such as privacy and cybersecurity.
  • Minimizing border frictions (e.g. imposition of customs duties on digital goods) and enable open data flows (e.g. creating an internationally interoperable privacy rules system).
  • Enabling cross border data flows and clarifying the framework for processing and storing data will be required to further expand the contribution of digital exports.
  • The report has suggested that countries should adopt the APEC (Asia-Pacific Economic Cooperation) Privacy Framework and join the APEC Cross Border Data Privacy Rules System, besides adopting the International Organization for Standardization (ISO) Standards, which specify controls to protect personal data.

Way Forward

  • There is an opportunity for India to play a leading role, not only at home, but also abroad in pushing for facilitative digital trade rules in its various bilateral and multilateral trade negotiations.

Source: HBL

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