In November 2020, the Friedrich Ebert Foundation published an article by Paul Nemitz and Matthias Pfeffer on the threat to digital sovereignty in Europe. They called attention to the need in Europe for “decentralised digital technologies” to combat a trend they see as essential for preserving “a flourishing medium-sized business sector, growing tax revenues, rising prosperity, a functioning democracy and rule of law.”
The authors felt encouraged by the fact that the European Council was at last looking at challenging the US tech platforms that dominate global cyberspace: Google, Amazon, Facebook, Apple and Microsoft. Europe appears ready to draft laws that would impose targeted regulation strategies different from those that apply to “small and medium-sized actors, or sectoral actors generally.”
Indian Farmer Protests Explained
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There are multiple reasons for such a move, which will inevitably be attacked by the corporations as violating the sacrosanct principle of free trade. Nemitz and Pfeffer recognize the complexity of the implicit goal, to ensure “strategic autonomy while preserving an open economy.” Besides the threat to traditional businesses incapable of competing with the platforms, they cite the fact that “unregulated digitalisation of the public sphere has already endangered the systemic role of the media in two respects” to the extent that 80% of “online advertising revenues today flow to just two corporations: Google and Facebook.” This threatens the viability of “costly professional journalism that is vital for democracy.”
Europe is struggling to find a solution. In the context of the farmers’ protests in India, the Joint Action Committee Against Foreign Retail and E-commerce (JACAFRE) recently took an emphatic stand on the same subject by publishing an open letter addressed to Prime Minister Narendra Modi. In this case, the designated culprits are the US powerhouses of retail commerce, Amazon and Walmart, but the authors include what they see as a Quisling Indian company: the mega-corporation, Reliance Industries.
The giant conglomerate claims to be “committed to innovation-led, exponential growth in the areas of hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and telecommunications.” JACAFRE suspects it may also be committed to the idea of monopolistic control. It complains that Reliance’s propensity for establishing partnerships with Facebook and Google is akin to letting the fox in the henhouse. This has less to do with the platforms’ direct action than the coercive power their ever-increasingly possession and control of data represents. “If the new farm laws are closely examined,” the JACAFE’s authors claim, “it will be evident that unregulated digitalisation is a very important aspect of them.”
Today’s Daily Devil’s Dictionary definition:
Unregulated digitalization:
A pandemic that grew slowly in the first two decades of the 21st century with the effect of undermining most human economic activities, personal relationships and even mental equilibrium
Contextual Note
Three years ago, Walmart purchased the Indian retailer Flipkart. Interviewed at the time, Parminder Jeet Singh, the executive director of IT for Change, complained that the data controlled by e-commerce companies is no longer limited to patterns of consumption but also extends to production and logistics. “They know everything, who needs it, when they need it, who should produce it, who should move it, when it should be moved, the complete control of the data of the whole system,” he said. That capacity is more than invasive. It is tantamount to omniscient and undetectable industrial spying combined with forms of social control that are potentially as powerful as China’s much decried social credit system.
In 2018, Singh appeared to worry more about Walmart than Facebook or Amazon, because it represents the physical economy. The day US companies dominate both the data and the physical resources of the Indian economy, Singh believes it would “game over” for Indian economic independence. He framed it in these terms: “If these two companies become a duopoly in the e-commerce sector, it’s actually a duopoly over the whole economy.”
On the positive side, he insisted that, contrary to many other countries, India has the “digitally industrialized” culture that would allow it not only to resist the domination of a US-based global company, but also permit it to succeed in building a native equivalent. He viewed Flipkart before Walmart’s takeover as a successful Indian company that had no need of a monopolistic US company to ensure its future growth.
Historical Note
Fair Observer’s founder, CEO and editor-in-chief, Atul Singh, recently collaborated with analyst Manu Sharma on an article debunking the simplistic view shared across international media that persists in painting India’s protesting farmers as a David challenging a globalized Goliath insidiously promoted by Narendra Modi’s government. The Western media’s narrative puts the farmers in the role of resistance heroes against a new form of market-based tyranny.
But as Singh and Sharma point out, this requires ignoring history and refusing to recognize the pressing need to move away from a “Soviet-inspired model” that ended up creating pockets of privilege and artificial dependence. These relics of India’s post-independence past became obstacles not only to productivity but to justice as well, to the extent that the existing system favored those who had learned to successfully exploit it.
Singh and Sharma highlight the incoherence of a system that risks provoking deeper crises. Does that mean that Modi’s proposed reform is viable and without risk? The two authors acknowledge the very real fear farmers feel “that big private players will offer good money to farmers in the beginning, kill off their competition and then pay little for agricultural produce.” They realistically concede that, once in place, “India’s agricultural reforms will have intended and unintended consequences, both positive and negative.”
But there may be more to the story. From the JACAFE’s perspective, the farmers’ instincts are correct. Their fear of the big players leveraging their clout in the traditional marketplace by exercising discretionary control of production and distribution becomes exponentially greater when considering that, thanks to their mastery of data, their control is not limited to the commodities themselves. It extends to all the data associated not only with the modes and means of production, but also with the channels of distribution and even habits of consumption. That explains why the JACAFE sees the 2018 takeover of Flipkart by Walmart as particularly foreboding.
This dimension of the issue should also help us to understand why Prime Minister Modi has recently been playing cat and mouse with both Jeff Bezos of Amazon and Mark Zuckerberg of Facebook. At some point, the purely rhetorical game that even a mouse with a 56-inch chest can play while dodging the bite of a pair of voracious and muscular cats (Amazon and Walmart) has its limits. India is faced with a major quandary. It needs to accelerate its development of domestic resources in a manner that allows it to control the future economic consequences for its population but must, at the same time, look abroad for the investment that will fund such endeavors.
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In a recent article on foreign direct investment (FDI) and foreign portfolio investment (FPI) in India, Singh and Sharma noted that the recent flood of cash can be attributed to the fact that “corporations from the US and the Gulf have bought big stakes in Reliance Industries, India’s biggest conglomerate. They are also buying shares in Indian companies. In effect, they are betting on future growth.” The problem with all foreign investment is that while it is focused on growth, the growth that investors are targeting is the value of their own investment and its contribution to augmenting their global power. From the investors’ point of view, the growth of the Indian economy is at best only a side-effect. The case of Reliance in particular will need to be monitored.
In December 2020, Reliance’s chairman, Mukesh Ambani, promised a “more equal India … with increased incomes, increased employment, and improved quality of life for 1 billion Indians at the middle and bottom of the economic pyramid” thanks to the achievement of a $5-trillion economy by 2025. While reminding readers that “Facebook and Google are already partnered with Reliance and own stakes in Jio Platforms,” the Deccan Herald reports that the three companies have joined hands again to “to set up a national digital payment network.” The question some may be asking is this: When three partners occupy a central place in expanding Asia’s second-largest economy, who are the foxes and who are the hens?
*[In the age of Oscar Wilde and Mark Twain, another American wit, the journalist Ambrose Bierce, produced a series of satirical definitions of commonly used terms, throwing light on their hidden meanings in real discourse. Bierce eventually collected and published them as a book, The Devil’s Dictionary, in 1911. We have shamelessly appropriated his title in the interest of continuing his wholesome pedagogical effort to enlighten generations of readers of the news. Read more of The Daily Devil’s Dictionary on Fair Observer.]
The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.
