Q . In India cutting access to the internet is normal in the lieu of various reasons. Describe its impact on the economic structure of the area?  7TH NOVEMBER,2020  (15 marks, 250 words, GS-3)



  • In the first para about the MSME sector, present situation and stats.
  • Second para could be about the importance of MSME sector
  • Then next para could include the issues and challenges.
  • The final para could be about the measures taken and the further reforms and initiatives required.

The Global Network Initiative today launched a new report: “The Economic Impact of Disruptions to Internet Connectivity” which highlights the significant economic damage caused when governments around the world deliberately shut down or disrupt Internet services. Based on this approach, the report estimates that an average high-connectivity country stands to lose at least 1.9% of its daily GDP for each day all Internet services are shut down. For an average medium-level connectivity country, the loss is estimated at 1% of daily GDP, and for an average low-connectivity country, the loss is estimated at 0.4% of daily GDP.

Restrictions to Internet access are on the rise globally, with frequent news of government-mandated disruptions of Internet access. Driven largely by political and national security concerns, state-ordered Internet shutdowns have become the “new normal” in many countries.

The United Nations considers cutting off users from Internet access, regardless of the justification provided, including on the grounds of violating intellectual property rights law, to be disproportionate and thus a violation of Article 19, of the International Covenant on Civil and Political Rights. It also calls upon all States to ensure that Internet access is maintained at all times, including during times of political unrest. 

At a time when governments of the world have committed to leveraging the power of the Internet and Information & Communication Technologies (ICTs) to reach the U.N. goals on Sustainable Development in areas such as education, health and economic growth, cutting off entire populations from the Internet is extremely counterproductive.

An Internet shutdown is an intentional disruption of Internet-based communications, rendering them inaccessible or effectively unavailable, for a specific population, location, or mode of access, often to exert control over the flow of information. Internet shutdowns can happen at a national level, where users across the entire country are unable to access the Internet, or at a subnational (local) level, where mobile and/or fixed Internet access in a state, city, or other localized area is cut off.

Internet shutdowns started gaining global attention during the Egypt uprising in 2011, when authorities shut down the Internet for nearly a week to disrupt communications of protestors. Since then, the use of Internet shutdowns as a tool for political purposes has steadily risen: according to Access Now, 196 Internet shutdowns were documented in 2018, growing from 106 in 2017 and 75 in 2016. With 114 shutdowns in 23 countries seen within the first six months of 2019, according to Access Now and the #KeepItOn Coalition, the trend shows no sign of slowing. While the phenomenon is global, current trends indicate that India and Pakistan lead with the most documented shutdowns. The internet shutdown in Kashmir — reportedly the 51st in Jammu and Kashmir since January this year and the 179th since 2012 — is continuing and there is an alarming uncertainty over when the curbs on communications services and facilities will be lifted. Kashmir, which has been hit by the political instability and other problems, has been hit further by Internet shutdowns with limited communications between businesses and customers. Another affected area is horticulture, a major sector in Kashmir’s economy. Internet shutdowns may not have direct impact on this sector, but the clamps on information dissemination and movement of people surely do.

From the OECD to US-based Brookings Institute, have looked into this aspect. During 2012-017, 16,315 hours of Internet shutdown cost India’s economy around $3 billion, the 12,600 hours of mobile Internet shutdown about $2.37 billion, and the 3,700 hours of mobile and fixed-line Internet shutdowns nearly $678.4 million. When a country like India is aiming to become a $5-trillion economy and wants to anchor the growth on its information and communication sector, Internet shutdowns send all the wrong signals to investors and consumers.

Today the Internet is a “primary driver of entrepreneurship” among the young. Many of them are into e-tailing, delivery services and similar ventures for which they bank on the Web.

Many of them use digital payment options. So obviously an Internet blackout means most of their socio-economic existence is threatened or stalled. Further, given that every hour Google receives more than 2.3 lakh search queries shows how much people rely on the Web for information gathering today.

Internet shutdowns simply cut off these channels of information for teachers, students, researchers, entrepreneurs, etc. So, shutdowns that last over months can literally paralyse almost all sectors in the region.


  • Technical impact: When a complete Internet shutdown occurs in a given country, the technical impact can extend beyond the country’s borders to the rest of the global Internet. Being part of an interconnected network means having responsibility towards the network as a whole, and shutdowns hold the potential to generate systemic risks.
  • Collateral damage. For example, shutting down Internet access to block access to social media services will also limit local access to Internet-based ride sharing and taxi hailing applications, likely creating a major disruption for transportation services.
  • Economic impact: Internet shutdowns affect economies in multiple ways, upsetting productivity and generating monetary losses in time-sensitive transactions.
  • Human rights impact: the exercise of freedom of expression and opinion and the right to peaceful assembly. These rights – recognized in the Universal Declaration of Human Rights and reflected in the Constitutions of many of the countries where those shutdowns occur – entrust governments with the responsibility to respect them and protect their citizen’s enjoyment of them. As stated by the UN Human Rights Council in 2012 and reaffirmed since, people should enjoy the same protections of these rights whether in online or offline contexts.


  • National security and public order.
  • Cross border enforcement.
  • Increasing censorship
  • Undermining commitment to sustainable development goals
  • Decreasing the effectiveness of various schemes and policies nad even undermining inclusivity.

Way Forward:

  • Build resilient infrastructure
  • Rule out all non-shutdown options
  • Measure the cost first.
  • Diversify voices
  • Perform watchdog functions

The Economic Potential of the Internet Revolution:

  • reducing the cost of many transactions necessary to produce and distribute goods and services.
  • Increasing management efficiency, especially by enabling firms to manage their supply chains more effectively and communicate more easily both within the firm and with customers and partners;
  • Increasing competition, making prices more transparent, and broadening markets for buyers and sellers;
  • Increasing the effectiveness of marketing and pricing;
  • Increasing consumer choice, convenience and satisfaction in a variety of ways.

Increasing the width of the Internet revolution will help ensure that its benefits are widely shared. It will help to curb not only the Digital divide but also improve inclusivity as one nation with every small individual connected with the core.






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