Even as India’s efforts to frame a comprehensive data protection Bill is being appreciated, officials of the European Union are concerned over the element of data localisation that is expected in the legislation which is currently at the draft stage.In an interview to ET, a top EU official who is currently visiting India signalled that it could not just hurt businesses operating in the country but also the trade pacts being negotiated by the two countries. Ralf Sauer , Deputy Head of Unit – International Data Flows and Protection (Directorate – General for Justice and Consumers), European commission said that the data protection Bill and the clauses over data localisation were discussed during meetings with the ministry of external affairs and ministry of electronics and IT over the last two days.“Of course, it is a question of concern from a trade perspective. It means that foreign operators might have to duplicate infrastructure to be able to hold a copy in India, it creates additional cost and it’s not just India which is the case but it is the tendency in number of countries in this region to think about data localisation, which will fragment operations of global players and make a habit to track the data and make it harder to compete. And it goes against the general philosophy of internet of seamless flow of data.”He added that due to its insistence on data localisation, India could be at a position of “certain risk” since companies which are dependent on Indian market might turn to other markets referring to the country’s huge outsourcing industry. “From the Indian perspective one of the things one should think about is one of the potential consequences. The EU -India trade relationships are very strong, a lot of data in financial, also business goes from Europe to India and this is not necessarily going to make it easier.” Sauer added that EU has ongoing trade negotiations with the country and this element maybe added to a number of others that will “complicate” the talks.The government appointed Justice BN Srikrishna Committee submitted a draft of the data protection Bill in July this year. After seeking stakeholder consultation on the draft, the ministry of electronics and IT is now in the process of finalising the draft which is expected to presented in the Winter session of the Parliament.ET had reported in the past that the government is likely to create categories of data which will mandate that all critical data – to be defined by the regulator – should be stored exclusively in India while one copy of some personal data may have to be stored in India as other kind of non-critical personal data can be located anywhere.Sauer added that full localisation will make it impossible to use the data for any kind of professional relationship between countries and will become an important factor for any company to consider while making their investment choices.“It is a choice for the Indian sovereign to make and we will not interfere in that process. We have taken the opportunity that was offered for a public consultation, beyond that we can only express concerns and this will also be done in trade talks,” he added. Sauer said that the overall the Bill has several components of a modern data protection law and will become a strong foundation for exchange of business between the countries.In its submission to the Ministry of Electronics and Information Technology (MeitY) on September 29, the European Commission said data localisation would create “unnecessary costs, difficulties and uncertainties that could hamper business and investments”. The European Union, which passed the ambitious internet privacy law (GDPR) in May, termed the data localisation requirements proposed by India as unnecessary, harmful and likely to have negative effects on trade and investments.