Today, most global citizens have digital avatars and are active in cyberspace. Especially in the wake of the pandemic, almost all aspects of interaction and subscription of services have moved online. Digital technologies have fast-tracked inclusion in multiple geographies in the last decade, including most Asian nations. Amongst other benefits, technology inclusion has proven to be most helpful in humanity’s efforts to achieve the Sustainable Development Goals (SDGs).

At the same time, new-age technology is not entirely innocuous in terms of its effect on welfare. Digital markets are dynamic and characterised by a rapid pace of innovation, where big data is the most critical input in driving change. However, user data is not just a commodity but also contains sensitive personal information such as financial information, sexual orientation and political leanings. Thus, protecting the privacy of users is critical to ensuring efficient digital markets. Additionally, data-driven markets are often ‘tippy’ and prone to concentration. Antirust agencies need to be extra vigilant in such markets and, perhaps, require ‘new tools’ to ensure that markets serve consumers.[^[1]] Online platforms may also threaten the democratic and social order if, as intermediaries, they fail to regulate harmful content. The digitalisation of our economy and social lives, further catalysed by the ongoing pandemic, may come to a standstill if cybersecurity, data protection and cyber sovereignty are not adequately addressed.

Regulating cyberspace – the global, interconnected, virtual world – is unlike any regulation humanity has had to undertake in its history. While past learnings lend some direction here, because of cyberspace’s global and unbounded nature, the world must come to a consensus on optimal regulation—enforceable within national borders but protective in spirit for all global citizens.

The world, therefore, needs optimal regulation that places social welfare at the core of new technology. While critically important, innovation, the key driver of human development, needs to be balanced against fundamental human values such as privacy, dignity, and security.  However, there are no ready templates of optimal regulation. In a conversation at Raisina 2021, Executive Vice President of the European Commission for A Europe Fit for the Digital Age, Margrethe Vestager, highlighted trust (including data and user privacy), contestability (including open competition and drive for innovation), and absence of manipulation as the core principles of regulation in the digital economy.[^[2]] These could serve as practical guiding principles to design optimal regulation frameworks for digital markets in all democracies.

What is also noteworthy is that, hitherto, the global south has been missing in the debates to craft regulation for the digital world. Given the rising economic might, population sizes and shared democratic values, it is essential for Asian economies to design regulatory frameworks that strike a balance between innovation and social welfare. While governments are utilising new-age tools to effect socio-economic change, the private sector is at the cutting-edge of technology development and an influential stakeholder in this debate. Naturally, therefore, designing an optimal regulatory framework requires greater engagement with industry views.

To conceptualise the optimal regulatory framework, the Observer Research Foundation (ORF), in association with Konrad-Adenauer Stiftung (KAS), engaged with private sector voices in South Asia. This Journal features these voices and endeavours to support policymakers in their quest to design regulation for the new age of technology. The thought-provoking contributors have brought in their hands-on experience developing technology, building innovation-led businesses, and investing the capital that drives both.

On capital, which is the fundamental enabler of the development of technology platforms—the critical interrelationship between (technology) entrepreneurship, capital investment and policy regulation is nonlinear and “deterministically chaotic”, describes Siddarth Pai in his essay, comparing it with the famous three-body problem in physics. Regulation, Pai cautions, must play a careful role. While it must protect the general populace from the ill-effects of new technology-driven businesses, going overboard with restrictive control mechanisms might result in the flight of both entrepreneurship and capital from the country; made particularly easy in this digitalised world where geography is (nearly) irrelevant. Contestability must not be sacrificed in the process of championing trust and the absence of manipulation.

Regulatory policy must also consider that there are two main components to innovative technology development—codified technology available in the form of frameworks and literature, and tacit expert knowledge that is only acquired by hands-on learning and execution.[^[3]] Kailash Nadh explicates this by demonstrating that regulators’ well-meaning instincts to protect citizens’ data and privacy must be augmented by tacit knowledge and “hands-on” subject matter expertise to sufficiently achieve the lofty goals of user privacy, data protection, and cyber sovereignty. Regulators endeavouring to formulate data- and algorithm-related regulation must integrate an intimate understanding of the complex nature of modern technology, which Nadh refers to as “an infinite series of nested blackboxes”.

Frontier technologies like artificial intelligence (AI), blockchain, and quantum computing can offer unique healthcare, agriculture, energy, and governance solutions. The rapidly evolving nature of these technologies is heralding an “era of hyperinnovation”, writes Umakant Soni. Exploring the case of AI, Soni enunciates the massive challenge societies will face reacting to the unprecedented pace of change and obsolescence unless governments can formulate a well-governed system that promotes responsible AI without stifling innovation. This delicate balancing act between regulation and innovation brings us back to the principles of contestability and trust.

Shinjini Kumar argues that technological platforms are fundamentally reshaping the trust structures in society and that any “decent shot at achieving the SDGs” must involve a meeting of the minds of all stakeholders. In her lucid essay, Kumar illustrates how regulators and technology developers can create new trust structures with an absence of manipulation to usher in a fresh era of sustainability.

Digital technologies and platforms are key to achieving several SDGs.[^[4]] Several Asian economies have accelerated financial inclusion in the past decade, a key enabler in eight of the 17 SDGs.[^[5]] Morshed Mannan and Saif Kamal delve into Bangladesh’s efforts to utilise emerging technologies to drive financial inclusion. Highlighting both the benefits and the risks of adopting cybertechnologies, Mannan and Kamal make critical suggestions for regulating the same – including the trust-building exercise of Regulatory Sandboxes. On the other side of the Bangladesh-India border, Deena Jacob speaks from the experience of navigating her company through the Regulatory Sandbox environment and endorses it as a reliable and interactive method for a country to test and implement “digitally native regulation”.

Mobility is another leading edge in the sustainability debate and prominently features in SDG11, which envisions to “make cities and human settlements inclusive, safe, resilient and sustainable”.[^[6]] Yash Narain and Aishwarya Raman write on the multi-stakeholder exercise of re-engineering India’s mobility frameworks, examining it from the four lenses of SDG11. In their broad-ranging essay, Narain and Raman buttress Soni’s viewpoint that the AI wave simultaneously perpetuates technological innovation and business model innovation, creating an explosion of end-use mobility models.

The International Monetary Fund’s Muhleisen explains that the answer to normalising the adoption of frontier technologies lies in formulating forward-looking policies that “maximise the advantages of the new technology while minimising the inevitable short-term disruptions”.[^[7]] Kshitij Batra concurs in examining the effect of technology disruptions on socio-economic development and employment. Batra explores the role of regulatory institutions in propagating Schumpeterian “creative destruction”, indicating it as an “essential churning process”. Batra joins Kumar, Mannan and Kamal in voicing the private sector’s precise needs from regulators to accelerate the development of disruptive technologies that ultimately serve the attainment of the UN’s 2030 Agenda for Sustainable Development. Jacob underscores this sentiment with a first-hand narrative on how India’s fintech ecosystem, which has driven the financial inclusion and integration of more than one billion people, has greatly benefitted from the “forward-thinking regulatory approach to how new utilities are jointly built with industry”.

No debate on the platform economy today is complete without discussing social media. Aprameya Radhakrishna explores multiple intersections in his piece—global vs indigenous social media platforms, regulator vs technology provider, and domestic vs extra state players. Radhakrishna uses the case study of Indian microblogging site Koo to explore how private players can react to the various needs for regulation—customisation for the country’s culture and languages, controlling fake news, anti-trust measures, promoting cyber sovereignty, and protecting national interests. Mohan Chathuranga, in his piece, while sharing his thoughts on the data protection legislation in Sri Lanka, reminds us how data protection, privacy and cyber sovereignty, and free and fair speech on online platforms are critical to the democratic order. Trust and absence of manipulation are sacrosanct in this new digital era.

The contributions in this timely volume on Regulating Cyberspace: Perspectives from the Private Sector in Asia bring a wealth of detailed ideas and an extensive range of perspectives across South Asia to bear on the exploration of this important, and perhaps, the most defining, debate of our digitalised era. Indeed, the debate will no doubt take time to resolve. By way of this Journal, however, we hope we are one step closer today to comprehending the intricacies of this multidimensional quandary.

Read the report here.

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^[1] Marc Wiggers, Marc Custers and Robin Struijlaart, “Commission’s New Tools for Policing Digital Markets Are Shaping Up Gradually, But Slowly”, Kluwer Competition Law Blog,

^[2] “In Conversation: Margrethe Vestager and Sunjoy Joshi”, Raisina Dialogue 2021 Conference Report.

^[3] Ricardo Hausmann and José Domínguez, “Knowledge, Technology and Complexity in Economic Growth”, Real Colegio Complutense at Harvard.

^[4] SDG Knowledge Hub, “GeSI, Deloitte Report Analyzes Impacts of Digital Technology Adoption on the SDGs”, SDG Knowledge Hub, September 27, 2019.

^[5] United Nations Capital Development Fund, “Financial Inclusion and the SDGs”, United Nations Capital Development Fund.

^[6] United Nations, “The 17 Goals”, United Nations.

^[7] Martin Mühleisen, “The Long and Short of The Digital Revolution”, Finance & Development, June 2018, Vol. 55, No. 2.

• Media and Internet
• Cyber and Technology
• India
• East Asia
• West Asia

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