The rising threat of cyber attacks is forcing nations to rethink their defence postures.
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Cyber attacks - the changing landscape
- From fiction to reality: Large-scale cyberattacks that disable real-world infrastructure systems have become a dangerous reality today, even in advanced countries like the US. The Colonial Pipeline that supplies oil to eastern US was hijacked by cybercriminals, and released upon payment of $4.3 m ransom in Bitcoins. Ireland's hospitals faced it days later!
- Everyone's affected: From the first virus in 1989 spread via floppy disks, today, no one is safe from such attacks - schools, colleges, infrastructure firms, governments - and some may face a disaster. If cybercriminals take down Air Traffic Control systems, or a nuclear power plant, it's over. All this is slowing down digitisation of industries (due to fear).
- What's driving cyberattacks: The growing number of connected devices worldwide, and instable geopolitics is an inflammable combination. West is directly pitted against autocratic China and Russia, and other autocracies.
- Large firms or systems getting hacked put huge sums at stake. Some examples: attacks on Sony Pictures 2014, Equifax 2017, SolarWinds, WannaCry etc.
- Listed firms say cyber risk has quadrupled since 2002, and tripled since 2013, and work-from-home has worsened it all drastically.
- Phyiscal angle: All countries today have vulnerable physical nodes (oil pipelines, power plants, ports) whose failure will bring large parts of economy to a halt. Then there's the risk for financial industry, where the weapon now is laptops not guns. Banks may collapse. These factors will bring the biggest threat: loss of confidence in new technology.
- IOT: The danger is that as chips and computer get integrated into everything - cars, houses, factories - an industrial IOT (internet of things) is being created. Theoretically, invisible insights will emerge, revolutionising healthcare and saving lives. But insecurity will lead to unforeseeable losses. Example: your car gets hacked, and "pay Rs.1 lakh or car stays locked forever".
- Dealing with it is hard: Since cybercrime lies on the fuzzy border between state and private actors, and geopolitics and crime. Everyone is a potential victim. ot only states intent of causing damage are the perpetrators, but criminal gangs in Russia, China and Iran do it (tolerated by states as they damage the West).
- Shame: Anyone attacked tries to cover it all up, out of shame. Most firms do not follow even basic security norms, like two factor authentication. Then there are sharks in the cyber-security industry fooling clients. Share prices have to start factoring in the impact of potential cyber-attacks, and punish the less careful firms accordingly.
- Legal and statutory steps: US, UK and French officials want a ban on insurance for ransom payments, as it encourages risky behaviour. It's better to make firms disclose risks, and attacks.
- When share prices drop (upon disclosures of poor cyber-security), firms will improve automatically, and device manufacturers may include security standards in products
- Govts now need to inspect the line dividing regular finance and digital finance (Bitcoin etc.). To make it tough to recycle cryptocurrencies into fiat currencies unless source is proven legitimate, is a good first step.
- Geopolitics: While in the real world, a state's behaviour will lead to reaction as per certain established norms, in the cyberworld, it's far more complex. Virtual intrusions so far haven't received big real world responses.
- Summary: All liberal societies must come together to prevent attacks, as G7 and NATO said. Confronting Russia and China like states is crucial too. The digital world economy cannot afford to let "broadbandits" run riot.
- EXAM QUESTIONS: (1) Explain the multiple implications of rising cybercrime attacks on mainstream physical institutions. What can be done to stop this? (2) Both State and non-State actors are involved in carrying out cyberattacks on adversaries. What are their motivations? What can be the checks? (3) The global economy is getting digitalised and inter-connected at a fast pace. The rising parallel danger is that of cripping cybercrimes. What are governments doing about it? Explain.
#cyberattacks #worldpolitics #IOT #China #Russia
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