In this podcast on the state of the economy, Businessline’s Anjana PV speaks to Anirudh Tagat, research author at Monk Prayogshala Department of Economics, about the impact of internet shutdowns on businesses. In a recent report by the Keep It On coalition, a group of civil society organizations that advocates against Internet shutdowns, it was reported that the Internet was interrupted 116 times in the country last year. These cuts have also affected companies. The Internet has become an essential tool for businesses around the world, and disruptions to this access can have serious consequences. One such disruption, internet outages, can cripple a business’s ability to operate, especially for startups and small and medium-sized businesses (SMEs). These outages prevent businesses from making online sales, communicating with customers, and managing other basic operations.
While the true cost of internet shutdowns to businesses is difficult to quantify, researchers have developed methods to estimate the financial cost. One challenge in measuring the impact is the lack of high-frequency data on businesses. Much of the data collected on businesses is collected annually, making it difficult to track the immediate effects of a shutdown. In addition, some of the negative consequences are qualitative and difficult to put into numbers. For example, a shutdown may damage a company’s reputation or erode customer trust, but these effects are not easily reflected in financial reports. Businesses themselves may also be hesitant to discuss the impact of shutdowns, fearing repercussions or not wanting to admit vulnerabilities.
Despite the difficulties in quantifying the impact, there is no doubt that internet shutdowns pose a significant threat to businesses. Loss of revenue, operational disruptions and potential reputational damage can have a devastating effect on a company’s bottom line. Furthermore, frequent internet shutdowns in a country can create a chilling effect on the business environment. Entrepreneurs may be discouraged from investing in online operations if they fear their businesses will be vulnerable to frequent disruptions.
Internet shutdowns are a major obstacle for businesses, especially startups and SMEs. These disruptions can cause significant financial losses, operational challenges, and reputational damage. The lack of readily available data and the difficulty in measuring qualitative impacts make it difficult to fully understand the scope of the problem. However, the negative consequences are undeniable, and efforts are needed to mitigate the use of internet shutdowns and protect businesses’ ability to operate freely online. Listen to the podcast to learn more.
(Presenter and producer): Anjana PV)
About Podcast on the state of the economy
India’s economy has been hailed as a bright spot amid the general pessimism that seems to have engulfed the rest of the world. But several sectors continue to flounder while others seem to be firing on all cylinders. To help you understand the set of contradictions that is the country, businessline brings you podcasts with experts ranging from finance and marketing to technology and startups.