Internet shutdown cost Indian economy $3 bn from 2012-17: Study

The Indian economy is estimated to have suffered a loss of USD 3 billion due to Internet shutdown in the country from 2012-17, according to a study by ICRIER. The study observed impact of Internet shutdown across various devices and ecosystem linked to them.  "A total of 16,315 hours of Internet shutdown in India cost the economy approximately USD 3.04 billion during the period 2012 to 2017," ICRIER director and chief executive Rajat Kathuria said today.

He was sharing details of report on 'Anatomy of an Internet Blackout: Measuring the Economic Impact of Internet Shutdowns in India'. According to the report, 12,615 hours of mobile Internet shutdowns in India cost the economy approximately USD 2.37 billion and 3,700 hours of mobile and fixed line Internet shutdowns in India resulted in a loss of approximately USD 678.4 million during the period 2012 to 2017.

"The objective of the study is not to pronounce on the efficacy of a state decision on an Internet blackout, rather to estimate the economic costs associated with the event. However, policymakers would be well advised to consider these costs in the final decision on a shutdown. If digital use were to proliferate as envisaged under the Digital India programme, the magnitude of loss could increase in the future, Kathuria said.

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E-Commerce businesses and online freelancers who operate out of small towns and are completely dependent on a functioning Internet are the most affected by Internet shutdowns, the report said adding that tourism has also become increasingly dependent on the Internet and has been significantly affected.

"Other Internet-dependent sectors such as banking and IT services are relatively less affected as they mostly function on private leased lines," according to the report.