WhatsApp to set up local entity

New Delhi: Facebook-owned WhatsApp has agreed to form a corporate entity in India and develop technological tools designed to stop the spread of fake news and other repugnant messages that could foment trouble in the country.

Information and technology minister Ravi Shankar Prasad told reporters after a meeting with WhatsApp's chief executive officer Chris Daniels here on Tuesday that the government had placed a set of demands before the popular messaging app company and demanded compliance if it wanted to continue operations in India.
WhatsApp has been asked to comply with data localisation rules once the Reserve Bank of India frames them. This will require digital platforms to ensure that all data relating to financial transactions involving Indians is stored in servers based in the country.
WhatsApp has also been asked to set up a grievance redressal mechanism and appoint an officer to deal with complaints that it receives and comply with all local laws.
"I had a very productive meeting. I complimented him (Daniels) for the extraordinary technological awakening that WhatsApp has triggered in the country in the areas of education and healthcare, relief in flood-ravaged Kerala," Prasad tweeted after the meeting .
"There are also some very sinister developments that incite crime like mob lynching and revenge porn. We have asked them to find solutions to these challenges."
However, Daniels did not make any public comment after the meeting.
India has stepped up efforts to crack down on mass message forwards after it found that people were using platforms such as WhatsApp to whip up public anger. Over the past three months, India has seen 39 incidents of lynching due to mass misinformation spread on WhatsApp, officials said.
They added that WhatsApp had already introduced a technical restriction that limits the number of forwards of a post to five at a time. "We are hoping for more technological breakthroughs from them which could filter and check for hate messaging," IT department officials said.
Officials admitted that the Indian security establishment had been unable to check the viral storm ignited by messages zapped across various digital platforms and messaging apps as they had been unable to crack the codes.
As a result, they have been unable to monitor messages and calls made on WhatsApp, while Facebook posts are more easily monitored.
Prasad told reporters that WhatsApp had also been asked to come up with a "technological solution" to ensure traceability of messages which are being circulated in bulk in a particular area in the country.
"I have said in the past that it is no rocket science to identify a message that is being circulated in lakhs on the same day in the same area."
WhatsApp has been in talks with the government after the ministry of electronics and IT sent notices to the company over the spread of fake news and hate messages.
Back in March 2015, telecom regulator Trai had floated a consultation paper seeking public opinion on whether over-the-top services (OTTs) that include WhatsApp and Skype should be subject to some form of regulation in India.
That debate has been inconclusive and the prospect for the creation of a regulatory mechanism will critically depend on the level of compliance with the government's directives.
Telecom ministry officials said Trai was likely to come up with a fresh consultation paper on messaging apps such as WhatsApp and Skype. There would also be a debate initiated by the regulator on whether these needed licences to operate in India.
One of the reasons for the paper was the fact that these apps were now increasingly being used for domestic and international calls, while the telecom carriers over whose internet these calls are made only earn data use time from them.
Since telecom firms typically earn 80 per cent of their revenues from voice calls, the emergence of free calls through WhatsApp or Skype presents a significant challenge to the viability of telecom firms.

Said Rajan Mathews, director general of the Cellular Operators Association of India: "We believe both players (net based messaging service providers and telecom firms) should be treated on an equal footing ... they should be put under the same obligations of taxation, legal enforcement and data privacy issues."