New data regulations warrant urgent rethinking
We are at a critical crossroads in our digital journey in Bangladesh. The Personal Data Protection Ordinance, 2025, and the National Data Governance Ordinance, 2025, ostensibly designed to safeguard privacy and data security, instead risk constraining the country's digital economy with outdated, restrictive and counterproductive regulations. Far from fostering innovation and trust, these ordinances threaten to isolate Bangladesh from the global digital ecosystem, deter investment and ultimately harm the welfare and interests of citizens.
At the heart of the problem lies the ordinances' aggressive data localisation mandates. By de facto mandating companies to store multiple categories of personal data within our borders or risk non-compliance penalties, these laws impose a costly and technically impractical burden on global service providers, including social media and content platforms such as Meta (Facebook, Instagram), Google (YouTube) and others. The result would be that companies may be forced to duplicate infrastructure, driving up operational costs and degrading service quality for the users.
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Worse still, a strict data localisation requirement can fragment and weaken cybersecurity defences, reduce the resilience of operations, make data more vulnerable to local and foreign threats by creating centralised targets and undermine privacy protections by concentrating data in a single jurisdiction, thereby increasing surveillance and censorship risks.
Countries that have embraced such localisation have seen digital markets shrink, innovation stall, and foreign investment dry up. We are faced with the risk of large, global service providers suspending services in Bangladesh, where social media platforms provide the backbone for our local digital commerce sector, which generates $1.5 billion (based on e-commerce logistics providers' transaction volume) in annual transactions and supports at least two lakh young entrepreneurs.
Equally troubling is the ordinances' sweeping extraterritorial reach. By asserting jurisdiction over companies worldwide, the laws create a legal minefield of conflicting obligations. This legal uncertainty raises compliance risks, discouraging cross-border partnerships and digital trade. In an era where harmonised, predictable data protection frameworks are the global norm, Bangladesh's approach is a regressive outlier that threatens to erect trade barriers rather than facilitate commerce.
The punitive enforcement regime compounds these risks. With fines reaching up to five percent of turnover and criminal penalties including imprisonment, the laws cast a long shadow over innovation. Ambiguous definitions and unchecked government access to private data further exacerbate the threat, undermining business confidence and due process. This is not a regulation that nurtures a vibrant digital economy; it is a recipe for stymying innovation and our economic development.
Even well-intentioned provisions aimed at youth safety fall short. Blanket bans on behavioural tracking and targeted advertising ignore the nuanced realities of protecting children online. Responsible use of behavioural data can enable age-appropriate experiences and direct vulnerable youth to critical safety resources. Denying these tools outright risks exposing young users to age-inappropriate and culturally irrelevant content, as well as missed opportunities for protection.
The stakes could not be higher. In their current form, these ordinances will isolate Bangladesh from the global digital economy, deter investment and most importantly, harm local businesses and users alike. There is a real and present danger that global platforms will cease services in Bangladesh, cutting off access to vital digital tools and opportunities.
Bangladesh needs to urgently rethink these ordinances. The country requires data protection frameworks that balance privacy with innovation, align with international standards and enable cross-border digital trade. Only through inclusive stakeholder engagement and a commitment to interoperable, forward-looking regulation can Bangladesh secure a prosperous digital future. The current ordinances are not the answer. They are a straitjacket that Bangladesh cannot afford to enforce.
Fahim Ahmed is the CEO of Pathao.
Views expressed in this article are the author's own.
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