Introducing the Digital Personal Data Protection (DPDP) Rules: A Step Toward Privacy and Data Protection in India

In January 2025, the Government of India introduced the Draft Digital Personal Data Protection (DPDP) Rules, marking a significant milestone in the nation’s journey toward a robust and comprehensive data protection framework. These rules are designed to implement the Digital Personal Data Protection Act, 2023, which aims to safeguard the privacy rights of individuals in India while ensuring the responsible processing of personal data by organizations.

As data privacy continues to gain prominence globally, the DPDP draft rules not only align with India’s data protection goals but also bring the country in line with international privacy standards like the General Data Protection Regulation (GDPR) of the European Union and the California Consumer Privacy Act (CCPA).

A Summary of the DPDP Draft Rules

The DPDP draft rules are structured to ensure transparency, security, and accountability in the processing of personal data. They focus on several key aspects, including:

1. Data Fiduciary Obligations: Organizations that collect and process personal data, known as "data fiduciaries," must implement adequate safeguards to protect personal data and adhere to transparency and accountability standards.
2. User Rights: Data principals, i.e., the individuals whose data is processed, are granted the rights to access, rectify, and erase their data. Additionally, organizations must seek explicit consent from individuals before processing their personal data.
3. Data Protection Impact Assessments (DPIAs): Data fiduciaries are required to conduct DPIAs before processing sensitive data or when introducing new technologies that may affect individuals' privacy.
4. Cross-Border Data Transfers: The DPDP rules set guidelines for the transfer of personal data outside India. Certain categories of data may be subject to restrictions or require additional safeguards when transferred abroad.
5. Penalties and Enforcement: Non-compliance with the DPDP rules may result in significant penalties, including fines, to ensure accountability and deterrence against data breaches and misuse.
6. Data Protection Board of India: The draft rules propose the establishment of a Data Protection Board to oversee complaints, adjudicate disputes, and provide guidance on the enforcement of data protection laws.

Comparing DPDP with GDPR and CCPA

The DPDP draft rules draw significant parallels to international data protection laws like GDPR (in Europe) and CCPA (in USA), which have already set global standards for data privacy. Below are key areas of comparison:

1. Consent and Transparency:

• GDPR: Requires organizations to obtain clear, informed, and unambiguous consent from users before processing their data. Consent must be freely given, specific, informed, and revocable.
• CCPA: Allows consumers to opt-out of the sale of their personal data, providing transparency on how their data is used.
• DPDP: Similar to GDPR, the DPDP draft rules emphasize the need for explicit consent and provide individuals with a right to withdraw consent at any time.

Example Impact: Under GDPR and DPDP, a company offering a mobile app in India must clearly inform users about the data it collects, how it is used, and obtain their consent before processing their data. The app must also provide an easy way for users to withdraw consent and delete their data, impacting how the app is designed and operates.

2. Data Subject Rights:

• GDPR: Provides individuals with rights such as the right to access, correct, delete, and object to the processing of their data.
• CCPA: Grants California residents similar rights, including the right to know what data is being collected, to delete it, and to opt out of data sales.
• DPDP: The DPDP draft rules grant individuals similar rights, including the right to access, correct, and erase their personal data, in line with both GDPR and CCPA.

Example Impact: In practice, businesses under DPDP, GDPR, or CCPA must implement processes to allow users to easily access and delete their data, which might require building user interfaces or back-end systems for managing data access and deletion requests.

3. Penalties for Non-Compliance:

• GDPR: Includes hefty fines, with penalties reaching up to 4% of a company’s global turnover or €20 million (whichever is higher).
• CCPA: Imposes fines for violations, with the possibility of higher penalties for intentional violations.
• DPDP: The DPDP draft rules propose penalties for non-compliance, similar to GDPR and CCPA, to ensure that organizations are held accountable for mishandling personal data.

Example Impact: Companies will need to invest in compliance infrastructure, conduct regular audits, and provide ongoing training to staff to minimize the risk of non-compliance penalties.

Introducing Privacy by Design: A Strategic Approach to Privacy

As data privacy concerns grow, organizations must move beyond mere compliance with regulations and embed privacy directly into their product design and management practices. Privacy by Design (PbD) is a concept, introduced by Dr. Ann Cavoukian, former Information and Privacy Commissioner of Canada, that emphasizes integrating privacy considerations into the development of products, services, and technologies from the outset. It advocates that privacy should not be an afterthought, but a fundamental aspect of system design. Below are the 7 core principles of Privacy by Design that organizations must integrate into their product development and organizational practices:

1. Proactive Not Reactive; Preventative Not Remedial

• Principle: Privacy by Design is about anticipating and preventing privacy risks before they materialize. Rather than reacting to data breaches or privacy issues, organizations must adopt a proactive approach to ensure privacy protection throughout the lifecycle of a product or service.
• Example: A cloud service provider should assess potential privacy risks before launching a new service, implementing data encryption and ensuring user consent mechanisms are in place, rather than waiting until a breach occurs to address privacy concerns.

2. Privacy as the Default Setting

• Principle: The default settings of any product, service, or system should be designed to protect user privacy, without requiring users to take additional actions. The system should automatically prioritize privacy unless the user opts to share more information.
• Example: When a user installs a new mobile app, the app should default to limiting data collection and sharing, allowing users to opt into specific data sharing options, rather than requiring users to opt-out of unnecessary data collection.

3. Privacy Embedded into Design

• Principle: Privacy must be integrated into the design and architecture of technologies, business practices, and processes from the very beginning. Privacy should be a core component of the system's functionality and not bolted on as an afterthought.
• Example: When designing an e-commerce platform, the system should ensure that sensitive data, like credit card information, is stored securely with encryption and that only authorized personnel have access. This should be part of the initial design phase, not an add-on after the product has been launched.

4. Full Functionality — Positive-Sum, Not Zero-Sum

• Principle: Privacy by Design advocates for a positive-sum approach, where privacy and functionality can coexist without compromising one for the other. It rejects the notion that there is an inherent trade-off between privacy and functionality.
• Example: A video conferencing app should be able to offer rich functionality, such as screen sharing or cloud storage, while ensuring that all data transmitted during the sessions is encrypted and accessible only to authorized users. Privacy is maintained without sacrificing the core functionality of the service.

5. End-to-End Security — Full Lifecycle Protection

• Principle: Privacy by Design ensures that security measures are implemented throughout the entire data lifecycle, from collection to storage, use, and eventual deletion. This principle guarantees that data is protected through strong security protocols at all stages.
• Example: A social media platform must implement robust data security measures such as encryption for stored and transmitted data, regular security audits, and secure access controls. The platform should also ensure that data is completely deleted when a user deactivates their account.

6. Visibility and Transparency — Keep It Open

• Principle: Organizations must ensure that their data processing practices are transparent and visible to individuals. Users should have clear and understandable information about how their data is collected, used, and stored.
• Example: An online retailer should have an easy-to-understand privacy policy explaining the data they collect, how it’s used, and how long it’s retained. Users should be able to access their data, request changes, or delete it without hidden barriers.

7. Respect for User Privacy — Keep It User-Centric

• Principle: The core of Privacy by Design is a respect for user privacy. The individual’s interests and rights should be prioritized, empowering users with control over their data.
• Example: A fitness tracking app should allow users to control the type of data collected (such as exercise data, location, etc.), how long it’s stored, and who it’s shared with. The app should empower users with easy-to-use privacy settings and respect their decisions.

The Need for Privacy by Design in Software Products

As product managers, especially in technology-driven fields like cloud platforms, building privacy into the product development lifecycle is essential. Privacy by Design helps mitigate risks, fosters user trust, and ensures compliance with privacy regulations such as the DPDP, GDPR, and CCPA. Here's why Privacy by Design is critical for software products:

1. Proactive Risk Mitigation

By embedding privacy controls early in the design process, product teams can identify and address privacy risks before they escalate into larger compliance or reputational issues.

Example: If a product or platform collects personal data like user email addresses, integrating privacy-by-design principles would mean implementing encryption for stored data, ensuring that only authorized users can access sensitive information, and proactively addressing risks related to data leaks or breaches.

2. Enhanced User Trust

Users are more likely to trust products and services that demonstrate a commitment to protecting their personal data. Implementing Privacy by Design shows customers that their privacy is a priority, which can lead to increased user loyalty and engagement.

Example: A social media platform that allows users to control what personal information they share, with clear privacy settings and explanations, enhances trust. Users are more likely to continue using a platform that prioritizes their privacy, especially after hearing about frequent data breaches on other platforms.

3. Regulatory Compliance

As privacy regulations evolve, ensuring that privacy is incorporated from the outset makes it easier to adapt to new or updated laws like the DPDP, GDPR, and CCPA. This reduces the risk of penalties and ensures a smoother compliance journey.

Example: A company launching an AI-powered healthcare app can ensure that personal health data is anonymized or pseudonymized, reducing risks of non-compliance with privacy regulations like GDPR’s restrictions on processing sensitive data.

Incorporating Privacy by Design into Product Management and Organizational Practices

To truly embrace Privacy by Design, organizations must integrate it into the entire product development lifecycle and organizational practices. Here are my views on some actionable steps for incorporating Privacy by Design into product management processes:

1. Define Privacy Goals and Metrics from the Start

• Set Privacy Milestones: Include privacy objectives at each stage of the product lifecycle, from ideation and design to deployment and maintenance. Privacy should not be an afterthought, but rather a core goal that is prioritized alongside other product features.
• Example: For a cloud platform, define goals like “Data Minimization” and “User Control” at the beginning of the product development phase. Later, measure success through metrics like “percentage of users who have opted for enhanced privacy settings” or “number of privacy-related complaints received.”

2. Cross-Functional Collaboration

Privacy by Design requires collaboration between various teams such as product managers, security officers, legal advisors, developers, and compliance officers. Privacy isn’t just a legal issue—it’s a product design and technology issue too.

• Example: Before launching a new feature that processes user data, a cross-functional team—including the product owner, a privacy officer, and a security expert—should collaborate on a Privacy Impact Assessment (PIA) to identify and mitigate potential risks.

3. Privacy as Part of Agile Product Development

Agile development methodologies can be adapted to include privacy as a key consideration in every sprint. Product managers can work closely with development teams to ensure privacy goals are incorporated into user stories and technical tasks.

• Example: During the backlog grooming session, product managers should add privacy-specific tasks, such as “Add encryption for sensitive data” or “Enable users to opt-out of data sharing,” ensuring privacy concerns are addressed within each iteration.

4. Build Secure Architecture from Day One

Privacy by Design is not just about user consent and transparency; it’s also about secure infrastructure. Ensure that personal data is protected through techniques like end-to-end encryption, data anonymization, and secure data storage.

• Example: When building an internal cloud platform, ensure that sensitive data is stored in encrypted databases and that only authorized roles can access it. This architecture will prevent unauthorized access and ensure compliance with regulations.

5. Continuous Monitoring and Adaptation

Privacy is not static; it requires continuous monitoring and adaptation to evolving legal, regulatory, and technological landscapes. Regularly update the product’s privacy policies and features to align with new privacy laws and user expectations.

• Example: For a mobile app, periodically review the user privacy settings to ensure they align with new legal requirements. If new privacy laws come into effect (e.g., DPDP or GDPR amendments), the product should be quickly adapted to stay compliant.

Conclusion

The DPDP draft rules represent a crucial step toward protecting personal data in India, aligning with global standards like GDPR and CCPA. By embedding Privacy by Design into every stage of the product lifecycle, from conception to delivery, organizations can ensure compliance, mitigate risks, and enhance user trust. This proactive approach to privacy will not only safeguard data but also create long-term business value by fostering a privacy-first culture in software product