Mumbai: Nearly 16,315 hours of Internet shutdown over the six years till 2017 cost India $3.04 billion (Rs 21,336 crore)--1.2 times the 2018-19 budget estimate for the Swachh Bharat Mission--according to an April 2018 report by the Indian Council for Research on International Economic Relations (ICRIER), a think tank.

The 12,615 hours of mobile Internet shutdowns in India cost the economy approximately $2.37 billion (Rs 16,590 crore); while 3,700 hours of mobile and fixed-line Internet shutdowns in India cost the economy nearly $678.4 million (Rs 4,746 crore) between 2012 and 2017, said the report, which analysed the economic impact of such shutdowns.

A 10% increase in India’s mobile traffic will deliver, on average, a 1.6% increase in India’s gross domestic product (GDP) per capita, and a 10% increase in India’s Internet traffic (fixed line and mobile) will deliver a 3.1% increase in India’s GDP per capita, the report estimated.

Internet shutdowns cost India $968 million (Rs 6,485 crore) in 2015-16, the largest loss among 19 countries surveyed and the result of 22 shutdowns, the same as war-torn Iraq, IndiaSpend reported on October 26, 2016.

Internet users in India increased 324% over six years to 2016, from 92 million to 390 million, compared to 60% in China to 750 million, 20% in Japan to 120, 14% in the US to 250 million and 63% in Brazil to 130 million over the same period, according to data from the International Telecommunication Union, IndiaSpend reported on August 14, 2018.

Jammu and Kashmir had most Internet shutdowns

The Internet was switched off 60 times over five years to 2017 in Jammu and Kashmir (J&K), more than any other state. Mobile and mobile & fixed-line Internet shutdowns in the state increased nearly 10 times to 32 in 2017 compared to 2012, while such shutdowns rose more than 22 times to 70 shutdowns across India in the same period.

Internet shutdowns in J&K during the period lasted 7,776 hours, nearly three times that of West Bengal, the state with the next largest number of shutdowns. Overall, the Internet was shut down nationwide, as we said, for 16,315 hours--half of this time in 2017.

Source: The Anatomy Of An Internet Blackout: Measuring The Economic Impact Of Internet Shutdowns In India, ICRIER (April, 2018)

People in South Asian countries experienced at least 97 Internet shutdowns, between May 2017 and April 2018. Such shutdowns are a barometer on press freedom and expression, with India alone accounting for 82 such cases, according to a United Nations Educational, Scientific and Cultural Organization report, the Indian Express reported on May 14, 2018.

While governments have supported the development of the Internet and digital infrastructure, there are clampdowns, using censorship, blocking and shutdowns, the report noted.

As many as 1,662 uniform resource locators or posts on social media were blocked over 18 months ending June 2018, IndiaSpend reported on August 14, 2018.

“Although there is no robust documented evidence of the relationship between shutdowns and loss of life and property, administrators shared anecdotally how shutdowns helped control spread of violence and civilian clashes,” the ICRIER report noted.

As many as 4,799 incidents of stone pelting took place from 2015 to 2017, as per home ministry data cited in a parliamentary response on February 7, 2018, IndiaSpend reported on May 18, 2018.

The extended period of shutdowns in Kashmir since 2016 and in West Bengal in 2017, have resulted in significant impact on the economy.

Economic cost of Internet shutdown highest in Gujarat

Although Gujarat faced 724 hours of Internet shutdown in 10 instances between 2012-17 compared to 7,776 hours in J&K, the Prime Minister’s home state was the most economically affected. A 2015 mobile shutdown cost the state nearly $1.12 billion (Rs 7,844 crore), nearly 4.3% of the present state budget of Rs 1.84 lakh crore.

Following the detention of Patidar community leader Hardik Patel in Surat on September 19, 2015, the Gujarat government banned mobile Internet and SMS services in major cities, including Ahmedabad, Vadodara, Surat, Rajkot and Mehsana, Business Standard reported on September 19, 2015.

Netbanking transactions dropped more than 90% on April 18, 2016, with banks across Gujarat suffering over Rs 1,500 crore in losses, as mobile Internet and SMS shutdown impacted many services, such as net and mobile banking, the Times Of India reported on April 19, 2016.

Source: The Anatomy Of An Internet Blackout: Measuring The Economic Impact Of Internet Shutdowns In India, ICRIER (April 2018)
Note: The total number of shutdowns in this figure is higher than that in the figure above, as some instances of shutdown in Jammu & Kashmir and Haryana were separated to account for differences in location of shutdown across network types during the same instance of a shutdown.

J&K was second with an economic impact of $610.24 million (Rs 4,273 crore), according to the ICRIER report. The economic cost to Haryana and the northeast was $429.2 million (Rs 3,005.6 crore) and $148.8 million (Rs 1,042 crore) respectively.

(Paliath is an analyst with IndiaSpend.)

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