India on Friday proposed a new data privacy law that will allow companies to transfer users' personal data to certain countries abroad, the latest regulation that will have an impact on how tech giants such as Facebook and Google operate in the market.
The draft bill comes after the government in August withdrew a 2019 proposal that had alarmed big technology companies by proposing stringent regulations on cross-border data flows.
In the new draft released on Friday, the government said it could specify countries or territories outside India to which entities managing data can transfer personal data of users.
"Cross-border interactions are a defining characteristic of today’s interconnected world ... Personal data may be transferred to certain notified countries and territories," the government said in a statement.
The Digital Personal Data Protection Bill is open for public consultation, the federal IT minister said on Twitter, without giving a deadline.
Companies including Facebook, Twitter and Google have for years been concerned with many technology sector regulations India, which have also strained relations with the United States in recent years.
The new bill also proposes financial penalties on companies for incident related to data breaches. It also says the federal government would have powers to exempt state agencies from provisions of the bill in the interest of national security.