The government aims to create a conducive environment for digital businesses while ensuring accountability and user protection. India is set to overhaul its outdated rules governing the use of the internet, potentially impacting the business practices of Silicon Valley giants operating in the world’s largest market.

A first draft of the new law, called the Digital India Act (DIA), will be published in June, with the goal of creating a conducive environment for digital businesses while ensuring accountability and user protection. The existing law, which dates back to 2000, is ill-equipped to achieve India’s digital economy target of $1 trillion or 20% of GDP over time, Rajeev Chandrasekhar, Minister of State for Electronics and Information Technology, said at a briefing in Mumbai on Tuesday.

The changes will affect how Alphabet Inc.’s Google to Meta Platforms Inc. to Amazon.com Inc. do business in a market that is expected to grow to 1.3 billion internet users by 2025, from the current 830 million. India is the largest internet community and the world will follow what we do, Chandrasekhar said in an interview on the sidelines. The government, which faces re-election next year, wants to implement the legislation by the end of 2023, Chandrasekhar said.

The DIA will cover a range of topics, such as: • Open Internet: The new law will define what is fair and non-discriminatory treatment of users. These could include principles on market concentration, platform power and user choice. The nation’s antitrust regulator had recently imposed large fines on Google for abusing its dominance over the mobile market. • Safe Harbour: The new law may do away with safe harbour provisions, which shield intermediary firms — such as Twitter and Facebook — from legal liability for content shared by their users. Instead, these firms may have to provide user identification or traceability to the government when directed. This is aimed at making internet users identifiable and traceable.

Content Monetization: The new law will include a framework on revenue sharing between content generators and platforms. This could benefit news publishers who have been complaining about unfair practices by Big Tech. The draft law would also explore differentiated rules for various kinds of platforms such as e-commerce, social media, digital news and emerging technologies. The DIA is expected to provide global and contemporaneous legal standards for catering to India’s evolving digital ecosystem.

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