By: Sk Md Assad Armaan, Research Analyst, GSDN
In this contemporary time, the world is witnessing an evolution in the foundations of power. Where nations once competed for land, minerals and oil, today they compete for something extraordinarily potent, which is data. From global companies analyzing consumer behavior to governments embracing digital governance systems, data has emerged as fuel driving the engines of modern growth. It builds Artificial Intelligence (AI), enables surveillance, influences elections, shapes the world economy, and accelerates states to reach the future of innovation. In popular discourse, this has led to a striking metaphor: “Data is the new oil.” This comparison is not merely rhetorical. Like oil during the industrial age, data today enables economic expansion and social transformation. Yet unlike oil, data is renewable and embedded in everyday life. This article explores why data earns this status, what it means for global power, and how nations including India are positioning themselves in this new digital era
The idea that “data is the new oil” is not just a metaphor; it reflects how information has become the world’s most valuable resource. Like crude oil, data in its raw form has limited use. But once refined through analytics and machine-learning pipelines, it fuels billion-dollar decisions, powers surveillance infrastructure, and determines economic systems. In today’s digital economy, nations and corporations with the ability to collect and monetize data command disproportionate influence. The digital giants of the 21st century like Google, Meta, Amazon, Apple are not simply tech companies; they are data empires whose power stems from integration, and predictability. Their business models generate profits not from hardware or software, but from behavioral insights extracted from user interactions. The more data they control, the more predictive systems become, creating a cycle of dominance that portrays how oil-rich nations once shaped global politics.
Value, Power, and the Architecture of the Digital Economy
Understanding this extraction process sets the stage for examining why refined data, not the raw digital traces we leave behind, has become the major driver of global power. The value emerges because data determines who understands society best. Platforms like Google Maps, YouTube, and Instagram predict consumer behavior, preferences, and even emotional states with accuracy. The oil analogy becomes visible in the way data is extracted continuously, and often without awareness. Every click, biometric scan, digital payment or search query becomes a drop in a vast ocean of the digital world. In this process, the line between public and private life dissolves as corporations shape political messaging, influence elections, and set the terms of social interaction. Data create profiles that can be bought and sold, turning personal behavior into a commercial activity. In this sense, data does not only reflect society; it reshapes it.
India provides a compelling case study of how data has become central to nation-building and governance. With over 1.3 billion people, India generates one of the world’s largest data ecosystems. Aadhaar, the world’s largest biometric database, captures fingerprints and demographic details of nearly the entire population. UPI dominates the digital payments landscape with billions of monthly transactions, revealing economic behavior at a local level. Together these activities form what scholars call the “India Stack,” a digital infrastructure that allows the state to deliver welfare, regulate markets and track economic flows at unprecedented scale. This data-driven system reduces leakages, increases financial inclusion, and accelerates digital governance, but it also raises debates about privacy and control. Here, data becomes an instrument of both empowerment and surveillance, showing how digital information can shape social outcomes more directly than oil ever could.
The analogy strengthens further when examining the global digital marketplace. AI systems, the engines of modern innovation, require enormous volumes of refined data to function. Nations with limited data access face disadvantages in AI development, similar to states without oil reserves during the industrial era. This competitive gap between data-rich and data-poor countries widens each year. Even telecom networks, e-commerce platforms, health systems, and defense technologies now rely on uninterrupted data flows. Whoever controls data much like oil controls economic and political leverage. Data thus becomes a geopolitical asset, shaping trade agreements and global governance standards. In essence, data is the new oil because it powers the digital economy, shapes predictive technologies, influences state capacity, and creates new hierarchies of global power. While oil is built in the 20th century industrial world, data is constructing the 21st century digital one rapidly and with transformative and structural consequences.
Monopoly, Surveillance and Digital Sovereignty
If data is the new oil, then Big Tech companies are the digital era equivalents of energy cartels. Their power does not come from physical assets but from the control of data that reshapes how people see, think, and behave. A small cluster of companies like Google, Meta, Amazon, Apple and Microsoft operate global digital arena that millions depend on for communication, commerce and knowledge. This creates a structural imbalance where corporations, not states, increasingly shape public discourse and economic sphere. Control over data is thus not only a commercial advantage but also a form of governance. This imbalance has pushed countries to question who truly holds sovereignty in contemporary times. In the 20th century, energy-rich nations set up the terms of global politics; today, data-rich corporations operate beyond the reach of national law. Meanwhile, states like China and the United States weaponize data for strategic power. China uses massive population-scale datasets to advance artificial intelligence and strengthen state security, while the United States benefits from Silicon Valley’s dominance in cloud infrastructure and AI research. Their competition over semiconductors, 5G networks, satellite systems, and AI models shows a broader race to determine who will control the next technological order. Data has therefore emerged as a geopolitical resource, central to national competitiveness and defense. Yet the very tool that empowers economies also generates new vulnerabilities. The misuse of personal information from targeted political advertising to manipulation threatens democratic processes and weakens public trust. Scandals such as Cambridge Analytica demonstrate how data can be used not only to understand societies but to influence them. Surveillance systems built across cities and digital platforms can monitor behavior at a vast scale. Unlike oil spills, data breaches are invisible yet deeply consequential. They expose identities, disrupt institutions, enable cyberattacks, and create insecurity for individuals and states alike.
In response, governments are now developing regulatory frameworks similar to how energy markets were once controlled. India’s Digital Personal Data Protection Act (2023), and emerging data-localization rules reflect attempts to reclaim authority over digital activities. Just as nations built strategic petroleum reserves, states today seek strategic data reserves and national cloud ecosystems. These measures are not merely bureaucratic; they represent a shift towards protecting citizens and institutions from being vulnerable on foreign platforms. India’s model stands out as an alternative path. Instead of allowing private monopolies to dominate digital public life, India has invested in public digital infrastructure such as Cowin, Digi Locker, UPI which treats data not only as a commodity but as a public good. This approach enhances inclusion, reduces market dominance, and encourages innovation without concentration of power in a few corporations. It shows that data can be used to empower citizens rather than extract profit, offering a model where digital development and democratic accountability coexist.
Conclusion: The Data-Driven World Ahead
The claim that “data is the new oil” is no longer speculative; it is a reality of shaping power, prosperity, and governance in the twenty-first century. Just as oil once determined industrial strength and geopolitical influence, data today defines who innovates, who governs, and who sets out the rules of the global digital order. Those who can extract, refine, and utilize data gain strategic advantage, while those without access remain structurally dependent. In this sense, data has become the core resource of modern capitalism, security, and state capacity. Yet, unlike oil, data carries ethical and political consequences that extend far beyond economics. Its misuse can erode privacy, undermine democracy, and corrupt power in ways that challenge traditional notions of sovereignty. The rise of digital monopolies and surveillance infrastructures demonstrates that unchecked data can deepen inequality and weaken public safety. This makes governance, regulation, and accountability central to how data power is exercised.
India’s experience illustrates that alternative pathways are possible. By treating data as public infrastructure rather than merely private capital, India shows how digital systems can promote inclusion and welfare while still promoting innovation. The challenge ahead is to ensure that data-driven growth remains aligned with democratic values, human rights, and social responsibility. Ultimately, if oil defined the industrial century, data is defining the digital one, but whether it becomes a force for empowerment or exploitation depends on how societies choose to govern this new resource.
