MAINS Current Affairs includes Rising Digital Censorship in India & India’s Next Reform: Lowering Cost of Doing Business in India

GOVERNMENT POLICY

1. Rising Digital Censorship in India

Context: The recent blocking of comedian Pulkit Mani’s video under Section 79(3)(b) of the IT Act has reignited concerns over the growing use of opaque and discretionary censorship powers in India’s digital space.

These incidents point towards a wider pattern of increasing executive control over online speech and content regulation.

Digital Censorship in India: Overview

• India’s digital platforms were initially viewed as spaces that strengthened democratic participation and freedom of expression.
• However, in recent years, there has been a noticeable rise in state-led regulation, monitoring, and removal of online content.
• This trend has raised important concerns regarding freedom of speech, transparency in takedown decisions, accountability of authorities.

Legal Framework Governing Online Content

Information Technology Act, 2000

Section 69A

• This provision empowers the government to block access to websites, social media posts, or digital content in the interest of sovereignty, public order, and national security.
• The Shreya Singhal v. Union of India (2015) judgment upheld its validity but insisted on procedural safeguards such as reasoned written orders, hearing opportunities, limited grounds under Article 19(2).

Section 79

• Section 79 grants safe harbour protection to intermediaries such as social media platforms.
• These platforms are required to remove content only upon receiving a court order, or a government direction.
• They are not required to act merely on private complaints.

IT Rules, 2021

• The IT Rules regulate social media intermediaries, OTT platforms, digital news publishers.
• They provide for:
  • grievance redressal mechanisms
  • content takedown processes
  • compliance obligations
• Subsequent amendments have significantly expanded executive powers.

Recent Developments and Expansion of Powers

Sahyog Portal (2025)

• The launch of the Sahyog Portal allowed more than 35 state police units and 8 central agencies to directly issue takedown requests.
• This has led to decentralised censorship powers with limited public accountability.

Reduced Takedown Timelines (2026)

• The amended rules reduced the compliance window to 3 hours.
• No explicit safeguards were provided for satire, parody, artistic content, political commentary.
• This increases the risk of over-censorship.

Proposed 2026 Amendments

• The proposed amendments seek to:
  • extend regulation to individual social media users
  • indirectly incorporate provisions of the Broadcasting Bill, 2024
  • give legal backing to informal advisories and SOPs
  • remove limits on data retention by intermediaries
• These changes may substantially widen state control over digital expression.

Key Issues and Concerns

Violation of Fundamental Rights

• Overbroad content regulation may infringe Article 19(1)(a), which guarantees freedom of speech and expression.
• Any restriction must satisfy the test of reasonable restrictions under Article 19(2).

Absence of Due Process

• In many cases, users are not informed about:
  • who ordered the takedown
  • reasons for censorship
  • available remedy mechanisms
• This weakens principles of natural justice.

Executive Overreach

• Many of these powers are being exercised through delegated legislation rather than through parliamentary enactment.
• This reflects an increasing shift towards an administrative censorship regime.

Chilling Effect

• Fear of penalties and takedown actions often leads to self-censorship.

This particularly affects:

• Satire and comedy
• Journalism
• Political criticism
• Dissenting views

Overlapping Legal Provisions

• Multiple provisions such as:
  • Section 69A
  • Section 79
  • IT Rules
• create confusion and arbitrariness in enforcement.

Judicial Response

Shreya Singhal v. Union of India (2015)

This landmark judgment struck down Section 66A as unconstitutional.

• It established the foundation of digital free speech jurisprudence in India.
• Key principles laid down:
  • vague restrictions violate Article 19(1)(a)
  • Section 69A valid only with safeguards
  • intermediaries act only on valid legal orders

Apoorva Arora v. Govt. of NCT of Delhi (2024)

• The court emphasised objective standards while judging obscenity.
• It held that interpretation should focus on whether the content is genuinely obscene rather than merely offensive.

High Court Responses

• Kerala High Court – recognised chilling effect concerns
• Bombay High Court – struck down Rule 9 for violating press freedom
• Madras High Court – raised concerns regarding excessive regulation
• Delhi High Court – stressed judicial scrutiny and proportionality

Emerging Judicial Principles

Doctrine of Proportionality

• Restrictions must be necessary, proportionate, least restrictive.

Due Process

• Blocking decisions must include notice, hearing, reasoned orders.

Protection Against Vagueness

• Laws regulating speech must be precise and not open-ended.

Safe Harbour Principle

• Intermediaries cannot be held liable unless they fail to comply with valid legal directions.

Way Forward

Strengthen Procedural Safeguards

• Mandatory:
  • written speaking orders
  • transparency reports
  • appeal mechanisms

Parliamentary Oversight

• Major regulatory provisions should be enacted through legislation rather than excessive rule-making.

Independent Regulator

• An autonomous body can ensure accountability and reduce direct executive control.

Protect Legitimate Speech

• Explicit exemptions should be provided for satire, artistic works, journalistic content, political criticism.

Harmonisation of Laws

• There is a need to remove overlap between IT Act, IT Rules, proposed broadcasting laws.

Conclusion

While regulation of online content is necessary to address misinformation, public safety, and national security concerns, unchecked and opaque censorship powers can undermine democratic freedoms.

A constitutional balance based on transparency, proportionality, due process, and accountability is essential to preserve India’s digital public sphere.

ECONOMY

2. India’s Next Reform: Lowering Cost of Doing Business in India

Context: India needs to shift focus from procedural reforms to cost rationalization, as it faces high business costs impacting competitiveness. Addressing high structural costs like credit, land, inputs, logistics, and compliance expenses is crucial for countries like India.

About Cost of Doing Business in India

• Cost of doing business refers to the total expenses incurred by firmsin production and operations, including cost of capital; land and labour costs; input and power costs; logistics and supply chain costs; and compliance and regulatory burden.
• India has improved procedural ease, but structural cost disadvantages persist, affecting global competitiveness.

Key Determinants

• Cost of Capital: India’s credit-to-GDP ratio (~50–55%) is far below global average (~148%).
  • High government borrowing crowds out private investment.
  • Higher interest rates compared to China/Vietnam.
• Input Costs: High electricity tariffs due to cross-subsidization.
  • Inverted duty structures increase the cost of intermediate goods.
  • Limited access to advanced technology inputs.
• Logistics Costs: Logistics costs reduced from ~13–14% to ~8% of GDP, still higher than global benchmarks.
  • Port delays, customs inefficiencies, and uncertainty persist.
• Land Acquisition: Fragmented land markets, unclear titles, and disputes increase costs.
• Compliance Costs: Heavy regulatory burden, especially on MSMEs; and lack of proportional, risk-based regulation.

Related Issues & Concerns

• Structural Cost Disadvantage: India’s firms face higher input and financing costs, reducing export competitiveness.
• Logistics & Trade Inefficiencies: Delays and unpredictability in customs increase transaction costs.
• Credit Constraints: Limited financial deepening restricts MSME growth.
• Regulatory Overload: Excessive compliance discourages formalization.
• Land & Infrastructure Bottlenecks: Project delays increase financing and operational costs.

Key Government Efforts

• Union Budget 2026-27: It reinforces Ease of Doing Businessas pillar of growth and development, while focusing on digitisation, tax certainty, investor access and litigation reduction.
  • Focus on digital trade facilitation by single, interconnected digital window for custom clearance and Custom Integrated System.
  • Exemption from Minimum Alternate Tax (MAT)to all non-residents who pay tax on presumptive basis.
  • Trusted importers recognised in risk systems, reducing physical verification and enabling factory-to-ship clearance.
• National Single Window System (NSWS):It guides in identifying and applying for approvals according to the business requirements.
  • It integrates approval processes across 32 Central Departments and 32 State Governments, and has access to over 698 central and 7435 state approvals.
• Digital financial ecosystemlike UPI, GST data, Open Credit Enablement Network (OCEN) for credit access
• PLI Schemesto boost manufacturing competitiveness.
  • These reforms have improved processes, but cost reduction remains incomplete.
• Ease of Doing Business reforms(digitization, single-window systems)
• National Infrastructure Pipeline (NIP)and Gati Shakti
• National Monetisation Pipeline (NMP)(₹16 lakh crore target)
• GST implementation for reduced cascading taxes

How India Can Compete with China & Vietnam?

• Lower Cost of Capital: Reduce Statutory Liquidity Ratio (SLR), improve credit access; and use fintech (GST, UPI data) for risk-based lending.
• Rationalize Input Costs: End cross-subsidization in power; correct inverted duty structures; and encourage technology-linked FDI.
• Improve Logistics Efficiency: Shift to tech-enabled, trust-based customs; reduce dwell time at ports; and expand multimodal transport.
• Land Reforms: Standardised leasing models; and clear land titles and faster dispute resolution.
• Regulatory Reforms: Introduce risk-based, proportionate regulation; and sunset clauses to reduce regulatory burden.

Way Forward: From Ease to Cost Competitiveness

• Benchmark India’s cost structure with China, Vietnam, and ASEAN economies.
• Focus on factor market reforms(land, labour, capital).
• Promote export competitivenessthrough cost efficiency.
• Encourage public-private partnerships and institutional reforms.

Learn from Vietnam & China

• Vietnam: Export-oriented policies, efficient logistics, FDI integration
• China: Scale economies, infrastructure depth, cheaper credit

Conclusion

India has successfully improved the ease of doing business, but the next phase requires reducing the cost of doing business.

A competitive cost structure is essential for boosting exports, expanding manufacturing, creating formal employment, and achieving sustained economic growth of more than 8%.

Thus, cost competitiveness will define India’s global economic position, along with procedural ease.

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