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9.29 In 2021, a number of significant structural reforms have been undertaken to drive
innovation, technology adoption and efficiency in the IT-BPM sector, including Relaxation of
OSP Terms & Conditions, and Consumer Protection (E-commerce) Rules, 2020. This would
significantly expand access to talent, increase job creation, make India a global hub for digital
services and catapult the sector to the next level of growth and innovation (See Box 1 for more
details).

9.30 The Indian start-up ecosystem has been progressing well, despite the Covid-19 pandemic.
Faced with a myriad of challenges at the onset of the pandemic, the ecosystem defied the odds
and had a record number of 12 start-ups that reached unicorn status. The country is home to 38
unicorns at present, as per the Nasscom Tech Start up Report 2021. The US and China have 243
and 227 unicorns, respectively.

Box 1: Major policy initiatives and reforms in IT-BPM Sector

Relaxation of OSP Terms & Conditions: With an aim to improve the Ease of Doing Business
of the IT Industry particularly Business Process Outsourcing (BPO) and IT Enabled Services,
the Government, in November 2020, simplified the Other Service Provider (OSP) guidelines
of the Department of Telecom. The new guidelines tremendously reduce the compliance
burden of the BPO industry and enables to ‘Work from Home’ (WFH).

In effect, the registration requirements of Other Service Providers (OSPs) were done
away with altogether and Business Process Outsourcing (BPO) services engaged in
data related operations have been taken out of the ambit of OSP. In addition, other
requirements such as deposit of bank guarantees, requirement for static IPs, frequent
reporting obligations, publication of network diagram, penal provisions etc. have also
been removed. These changes will enable IT-BPM companies to ‘Work from Home’ and
‘Work from Anywhere’. Additional dispensations to enhance flexibility for the Industry
have been allowed.
Consumer Protection Act, 2019: The Act came in to force on 20 July 2020 empowering
th
consumers and to protect their rights through its various notified rules and provisions
such as Consumer Protection Councils, Consumer Disputes Redressal Commissions,
Mediation, Product Liability and punishment for manufacture or sale of products containing
adulterant / spurious goods. The Act includes establishment of the Central Consumer
Protection Authority (CCPA) to promote, protect and enforce the rights of consumers.
Moreover, every e-commerce entity is required to provide information relating to return,
refund, exchange, warranty/guarantee, delivery, modes of payment, grievance redressal,
payments, charge-back options, etc. including country of origin which are necessary for
enabling the consumer to make an informed decision at the pre-purchase stage on its
platform. Further, the New Act introduces the concept of product liability and brings
within its scope, the product manufacturer, product service provider and product seller,
for any claim for compensation. The Department of Consumer Affairs (DoCA) published
the Consumer Protection (E-commerce) Rules, 2020 in July 2020.