Transforming India through Digital Innovation

In recent decades, India’s growth story has been difficult to ignore. And the Indian technology revolution, a key contributor to this growth, has been remarkable. The information technology industry contributes to nearly 9.5% of India’s GDP and is the largest private sector employer, generating some 3.5 million direct jobs, and over 10 million indirect jobs [1].
 
However, the dividends of India’s digital growth have been unevenly realized, providing lots of opportunities for improvement, including:  

• Mobile penetration in India is still relatively low. India’s rural populace makes up approximately 68% of the population but account for just over 40% of its mobile users[2].
• India ranked 156th in the world in terms of broadband penetration (at over 19%) as per the UN Broadband Commission report released in 2015.[3]
• Roughly nine out of 10 workers are informally employed and lack social protection. Most workers lack adequate education or skills and the educated youth faces high unemployment rates.[4]

To bridge this digital divide and to provide a digital platform for inclusive growth, the Indian government launched the Digital India initiative in July 2015, with the aim of transforming India into a digitally empowered society and knowledge economy.
 
At a World Bank event last October in Washington DC titled ‘Digital India: Transforming India into a digitally empowered nation’ Ram Sewak Sharma, Chairman of Telecom Regulatory Authority of India(TRAI), laid out three key elements of the Digital India program and vision, namely:

• Digital infrastructure as a utility to every citizen,
• Governance and services on demand, and
• Digital empowerment of citizens

 
One of the key components of this vision is to enable citizen participation in the digital and finance space through the JAM trinity, which consists of:

• Jan-Dhan: a program of financial inclusion through which 170 million bank accounts have been opened in a span of 100 days.
•  Aadhaar: a program to provide Digital-ID online infrastructure through which 920 million Unique IDs have been issued and 1 billion users are expected to be registered by March 2016.
•  Mobile: a program to leverage the nearly billion mobile phone connections through the creation of mobile IDs and mobile-based service delivery.

 The Aadhaar program, for example, assigns a unique 12 digit random number to an individual, collects biometric details, name, gender, age and address and costs only about $2 per individual.  Aadhaar holds tremendous potential for unlocking the Indian economy by providing a common platform which can be integrated with a multitude of government programs such as financial and social inclusion programs, and a Public Distribution System monitoring, to name a few.
 
Sharma mentioned that the introduction of Aadhaar can help plug duplicate and fake identities and generate huge fiscal savings for the government (of up to INR 500 Billion per annum) as it transfers all its subsidies directly to the bank accounts of the intended beneficiaries.
 
Mr. Sharma also mentioned other innovations of the Digital India initiative like e-Sign, a facility that enables citizens to digitally sign documents and open bank accounts remotely; or Digital Locker, which allows for authenticated storage and access of citizens’ government records securely over the cloud.
 
Although India has accumulated tremendous knowledge in digital transformation over the past two decades, most of this is tacit knowledge that exists with Indian ICT practitioners. This presents a great opportunity for India and the World Bank to work together to share India’s repository of rich technical expertise with other developing nations.
 
The World Bank-led Digital Development Partnership (DDP) launched in early 2016, along with the World Development Report 2016 on Digital Dividends, offers India a unique platform to partner with the World Bank for digital innovation and development financing. The DDP’s priority areas are broadband access for all, promotion and protection of digital infrastructure, and mainstreaming of digital innovations for sustainable development.

The World Bank Digital IDs for Development program (ID4D) also offers another avenue for collaboration, by providing financial assistance to Digital ID development in sectors such as financial services, social protection, and health care; establishing policies to promote the use of open, interoperable technology while ensuring security and privacy; and catalyzing a global network of digital ID experts (including Nandan Nilekani, Melinda Gates, the presidents of Estonia and Chile, and others) to assist countries build capacity in designing, deploying, monitoring, and maintaining digital ID systems.
 
Furthermore, as India evolves from being a provider of digital services to being an intelligent consumer of data to make smarter decisions, it has much to gain by defining a ‘Smart Vision’ by working alongside the World Bank and partner nations such as Singapore, South Korea and Estonia which are pushing the frontier of cutting edge innovation and digital development.  
 
Together India, the World Bank and other partners can work towards realizing the India of tomorrow by catalyzing the transformation of India into a knowledge society and smart nation.