Imagine this: The year is 2030 and Umair’s family in Bangladesh has been evacuated due to flash floods in his village and surrounding areas. They are temporarily accommodated along with others in a digitally fabricated house built by a local innovation hub. The house is equipped with a photovoltaic ‘skin’ to harness solar energy as well as a rainwater collection and purification system. Meanwhile, his daughter seamlessly continues her education online using a school supplied device and personalized learning tools. Local authorities are tracking infectious disease outbreaks in the area using sewage biosensors and medications are being delivered through a smart, resilient supply chain. Thanks to detailed resource mapping provided by the local government via phone, Umair is able to access goods and services for his family. Because his family is registered on the adaptive social protection scheme, he is contacted by the government to ensure continuity of services and eligibility for enhanced social assistance payment.
Sound like far flung science fiction? Not quite. It’s a distinct reality enabled by converging technologies—a synergistic combination of four groups of technologies, including information technology, biotechnology, nanotechnology, and cognitive technology along with increasing application of Artificial Intelligence (AI).
The World Bank’s newly released report titled, The Converging Technology Revolution and Human Capital: Potential and Implications for South Asia looks at how the region can capitalize on such technologies already sweeping the world, to accelerate human capital development and promote resilience to future shocks.
The converging technology revolution can build and protect human capital through improved service delivery; create jobs and innovation; and empower human capital through inclusion and trust
How converging technologies work to build human capital
In doing so, it can accelerate the building of human capital and make nations more resilient in the face of new risks and shocks such as climate disasters, pandemics, and technology-induced disruptions in employment.
Specifically, The Converging Technology Revolution report identifies four channels of interaction between technology and human capital:
- Technologies deployed in health, education, and social protection: these can improve service delivery.
- Technology applications in sectors such as agriculture, energy, water, and sanitation: these can improve child nutrition and reduce transmission of disease, thereby improving human capital.
- The availability of skilled labor affects the use of technology in the workplace: it alters the demand for skills and the requirements placed on the education and training system.
- Highly specialized human capital such as scientists, engineers, and professionals help drive the innovation system: this in turn creates and adapts converging technologies for local use.
In South Asia and globally,. Education and social protection sectors are making strides in using digital technologies for delivery of services.
Rising up to the challenge
While converging technologies are creating vast new opportunities for accelerating human capital outcomes, they also bear the potential of generating new and considerable risks.
For one, the technology revolution in South Asia is mainly led by the private sector causing disparities and inequalities. A stark example is in education, whereMeanwhile, those in private educational institutions have ensured learning continuity by shifting to online and mobile learning. If not handled with caution, these technologies could exacerbate existing inequalities, deepen exclusion and discrimination, and eliminate empowerment.
South Asia is also trailing in technology and data governance as well as in social trust, essential for protecting vulnerable populations.Yet, data can be misused for exclusion and discrimination, while “data invisible” groups, such as women and marginalized communities, are not represented in AI algorithms, leading to potential bias in automated decision making or in the development of personalized solutions. For example, there’s limited “first-mile” access to digital infrastructure such as reliable, high-speed, and affordable connectivity and devices for schools and health centers in poor communities, as well as for the women in households across South Asia.
Mobile phone and desktop/laptop ownership, and internet awareness and usage in selected South Asian countries
Looking ahead: Ensuring inclusive technology for all
The World Bank has invested heavily in technology in human capital related projects in South Asia, with $ 6.4 billion of current loan commitments being for technology components.This includes developing new service offerings for clients by undertaking technology assessments, advisory services, and technology enabled human capital projects; building adequate capacity for the public sector to equitably deploy technologies and formulate policies in these areas; and establishing the right framework for data and technology governance.
If done right and well, accelerating our work in converging technologies will lead to increased trust and community participation, and ultimately help realize the optimistic scenario for Umair and his family across all citizens of South Asia.
Join the Conversation
Some comments/suggestions, based on India work.
Promoting Digital Revolution in India
Today’s digital revolution is India’s tomorrow’s growth driver. Digital technologies—the internet, mobile phones—have spread quickly, and more households own a mobile phone than have access to clean water. For India to benefit from its demographic dividend, digital technologies will need to benefit everyone and everywhere. It requires closing the remaining digital divide to build human capital, invest in skills for future jobs, improve the climate change agenda, and provide a stronger digital foundation for competition and regulation to promote digital trust and innovation.
India has a billion-plus biometric identity card and a billion-plus cell phones. Information technology has become the biggest driver of economic and social transformation. The global coronavirus pandemic has accelerated the pace of digital revolution, as people make greater use of the internet. By 2025, India’s economic growth will be largely determined by the level of integration into the digital ecosystem (Services-led growth in India: A new hope for development).
India has leapfrogged from agriculture into services, sidestepping the manufacturing sector. Empirical analysis of firm-level data shows that productivity growth is much higher in firms in the service sector compared to the manufacturing sector. Thanks to the declining cost in digital communication, India is at the frontier of the global service revolution (E. Ghani, W. Kerr, C. Stanton, Diasporas and outsourcing: evidence from oDesk and India).
Digital revolution has also accelerated growth and created jobs in less skill sectors. It has changed global supply chains, and promoted stronger linkages between formal and informal enterprises. Informal employment in informal services sector has increased dramatically in India, with an exceptional increase of employment in informal tradable sector, equivalent to the entire net growth of the manufacturing sector over the same period (E. Ghani, W. Kerr, and S. D. O’Connel, The exceptional persistence of India's unorganized sector).
India’s transition into the digital world is still at an early stage. Although India’s entry into the internet came well before compared to China, internet access and connectivity in India is 10 times lower compared to China. Ironically, there is also less internet competition in India compared to China. The work horses of the digital revolution—computers, the internet, artificial intelligence backed by electricity and big data—are not yet as widely available in India. This has resulted in a huge digital divide in India.
Shaping the Digital Future
India’s young demographics, if backed by investments in infrastructure, will enable India to benefit from a huge digital demographic divided. Given an aging population in China, Europe and USA, and the youth bulge in India, the rate of return on digital investments is much higher in India. India’s digital demographic divided can already be seen in the global talent race, with the share of share of high-skilled migrants from India increasing more rapidly compared to low-skilled migrants. Over 70% of software engineers in Silicon Valley in the US are foreign-born. The top three applicants for H-1B visas in the US are Indian outsourcing firms.
India’s digital demographic dividend will benefit from five strategic initiatives. First, the fiscal policy will need to scale up focus on the digital strategy. A vast majority of the public investment program in the program still goes into the traditional infrastructure (roads and highways), and very little into the digital infrastructure. Although traditional infrastructure is important, our estimates show a much higher rate of return from investments made in the digital infrastrcuture. Unlike in China and USA, which have rapidly expanded investments in the digital infrastructure, India’s fiscal stance is still very traditional. India needs to scale up investments in the digital infrastructure from billions to trillions to expand digital reach, increase digital depth, and reduce the digital divide (Covid Risks a Lost Generation Amid India's Digital Divide; Closing the digital divide - The Financial Express).
Second, India’s digital readiness needs to be aligned with other development goals, especially education, health, urbanization and climate change. India has experienced one of the fastest pace of urbanization in the world, and nearly 800 million people will be living in cities by 2030. Cities create pollution and congestion, which can be reduced by deploying advances in digital technology and transport. Advances in wireless sensor systems, information and communication technology (ICT) allow cities to collect and curate huge amounts of data capable of sustaining and improving the urban life, thanks to the new and ever-growing web of connected technology. The linkages between urbanization and digital revolution will also enable technologies to be deployed in education and health, and improvement in delivery of water, sanitation, energy, and social services.
Third, policy makers will need to promote a more competitive digital sector to enable more innovative companies to enter markets easily. E–commerce laws should not become the province of a few large firms, and a winner-takes-all story. Firm registration will need to be improved to create greater market transparency and reduce price collusion and market sharing.
Fourth, a digital regulatory environment should promote a competitive behavior, and put a ban against using algorithms and fake reviews, and prevent behaviors like forced exclusivity arrangements, or use of technical means to interfere with the operations of rival platforms, or maliciously render those services incompatible with their own. Greater digital entrepreneurship can be promoted through the interoperability and data mobility across different enterprises, just like it was done with the traditional telephone system. This will enable consumers to use multiple digital data services, and switch from an inferior digital service provider, to a superior one. This goal can be included in the recent e-commerce bill that is being prepared in India. Providing greater choices to consumers will enable many more new digital enterprises to enter, promote innovation, improve efficiency and create more jobs.
Fifth, the digital regulatory environment should protect personal data, freedom of expression, and opinion. Digital enterprises use personal data, and the benefits and costs of personal data transcend the costs associated with labor and capital. It improves their productivity, but also creates huge downside risks. Personal data collected for one purpose has the potential to being misused for other purposes that can harm individuals and societies. The more data are reused, the greater is this downside risk of the data misuse. This can be avoided by taxing digital enterprises on the basis of data used, just like enterprises and households pay for the amount of water used.
Given that the digital data can move globally in an interconnected world, protecting personal data can be challenging at the country level. A global cooperation is needed to support policies that protect the data of people, on which digital enterprises depend to do business. As the world’s largest democracy, India can take the lead on promoting and protecting the data of people. Today's international trade regime was not designed for a world of data, software, and artificial intelligence. Already under severe pressure from China’s rise, and the backlash against hyper-globalization, the global trade regime is utterly inadequate to manage the challenges of new digital technologies faced by the developing countries. India can also promote the freedom of expression in the digital world, and discourage the use of internet shutdowns, as blunt instruments that gives immense power to a few people and goes against democratic goals.
Given India’s youth bulge, rising middle class, and expected high rate returns from digital investments, India’s digital demographic dividend will be huge. Funding for digital investments can be mobilized from the current global glut in savings. For years, the “digital divide” has been narrowly defined in terms of internet connectivity. Today, it manifests itself in the skills of the youth ready for a new digital world. Digital regulatory environment needs to change to prevent a few large enterprises from using technology to strengthen their control of the global value chains, and extracting a larger share of the value-added. We need to promote a digital world that reduces digital divide, gender divide, and promote entrepreneurship and job creation.