Regulating technology

The Young Innovators Summit in New Delhi last week featured many demonstrations of technology. Noteworthy exhibits included a smart anti-pollution mask, artificial intelligence (AI)-driven speech-therapy apps, an app that matches organ donors with recipients, and a learning solution based on the adaptation of the videogame, Minecraft. Microsoft Chief Executive Officer Satya Nadella made some thought-provoking remarks on regulation in an interview. Drawing analogies with air travel and the food industry, he said regulation was needed to manage technology missions critical to our lives and society, and that it is necessary to protect fundamental rights like privacy. But he went on to warn that over-regulation led to increased transaction costs, which discouraged entrepreneurs.

The golden mean, therefore, is adequate regulation to prevent technology threatening fundamental rights, but not so much regulation as to stifle innovation and ideas by an excess of red tape and censorship. Finding this balance is easier said than done. New technology is disruptive by its very nature. The disruption can be benign or malign. It is often a combination of the two and it is impossible to predict all the applications of new technology. The “bigger” the technology, the greater the disruption. Consider the impact of the printing press, for instance. The mass production of books promoted literacy. The rapid dissemination of new ideas triggered the Age of Enlightenment and the Industrial Revolution. The new ideas also caused a tectonic shift in the power structures of Europe, leading to religious schisms that triggered wars and revolutions in which millions died. Every major technological innovation has led to similar radical change. The telegraph enabled global communications, while steam, electricity, and aviation improved transport and manufacturing capacity. Machine looms and seed drills transformed the textile industry and agriculture. 

All these created new avenues for entrepreneurship and generated millions of new jobs. But they also swallowed up jobs that became redundant and they empowered colonialism. The 21st century society is defined by the all-pervasive Internet, along with ubiquitous, cheap, mobile computing power, and the deep penetration of social media. That has had more than its fair share of unintended and unimagined consequences. Digital technology has enabled new business models and the easy delivery of services to vast populations. It has democratised news and content creation, and delivery. But it has also enabled the creation and delivery of fake news, with equal facility, and it has given states the power to target, track, and harass individuals 24x7. There have been many strange outcomes. Laundrymen in Montenegro (part of the erstwhile Yugoslavia) influenced the 2016 US presidential election by pumping out snippets of fake news to generate monetisable page views. But social media also enabled protesters in West Asia and it has ensured that the voices of Hong Kong and Shaheen Bagh cannot be muted. There will be further acceleration in the pace of digital innovation. By 2025, over 50 billion connected devices will create a global data network of unimaginable dimensions. AI will have conquered new fields. That will lead to more changes in the social fabric. Our legal systems will have to learn to manage those new tools, and cope with the disruption.

If India is to be a front runner in that technological race, it must ensure the disruptions are more benign than dystopic. Regulation must, at one level, be light-touch with benign tax treatment, and easy clearance for new ideas and start-ups. At the same time, the laws must strictly restrain the state and prevent it from invading the privacy of individuals and censoring thoughts and ideas. Technology showcased at the Young Innovators Summit comes from students with little funding. But taking proof-of-concept to market involves investment. The start-up ecosystem must not be crippled by tax “surveys” and absurd demands. At the same time, the surveillance state must be restrained by legislation protecting privacy and free speech. Proposed privacy legislation, and tax laws as applied in practice, suggests policy is headed in the wrong direction in both cases. We have a long way to go, and it involves taking a U-turn.

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