Seventy years after its independence, India’s standing as a digital leader massively overshadows its reputation for exotic spices and snake charmers. With the fastest growing large economy in the world, and a $150 billion IT sector behind it, the subcontinent of nearly 1.3 billion people is writing its own veritable digital success story.
India’s IT sector is fueled by some of the best and brightest talent in tech. This, coupled with a government that’s invested in the country’s digital future is proving to be a potent combination that’s causing ripples across its public and private sectors and beyond.
The country’s vast human and technology resources makes it the destination of choice for tech and business process outsourcing (BPO), giving it unique avenues into, and influence over, western markets. Mass outsourcing also means that much of the innovation seen in western companies originate from one of India’s many hi-tech cities, such as Hyderabad and Mumbai, which positions the country as a key player in the digital future of business. Further, competition within its own technology market is fueling India’s momentum towards global digital dominance.
“70 years of independence has seen India transform into a global powerhouse. Indian technology innovation now positively impacts companies around the globe, and in particular, the UK and US are growing as recipients of Indian IT outsourcing investment.”
Research by Dell EMC found that 90% of Indian enterprises have seen new competition in their industries due to digital technologies, with 60% planning to invest large chunks of their budgets to counter new market players. Compared to global findings, these figures point to a far more digitally aggressive marketplace.
In fact, further research puts India in the global lead when measuring the collective business impact of each country’s DX efforts. Among Indian organisations, 94% said DX was about investing in the right talent, while 92% posited a well-articulated digital vision as critical to success and an impressive 83% stating that they actively embrace digital technologies. In a world where so many companies get digital fundamentals wrong, with even more happy to only pay it lip-service, Indian companies’ collective take on DX is refreshing.
“India’s investments in cloud, analytics, AI and robotics have positioned it as a global resource for companies looking to jump-start their digital transformation journeys, making the sub-continent a digital leader in an increasingly digital world.”
The India Stack
Central to India’s digital success story is the fact that both its public and private sectors are equally invested in it. The feats achieved in a relatively short space of time is undoubtedly thanks to close collaboration between government and private technology companies.
Such joint efforts resulted in what is known as the “India Stack”: a set of four interrelated government services that are layered in the same fashion as that of a software stack. The stack allows the country’s 1.3 billion citizens to access previously archaic government, banking and other social services through digital identification.
How? It all started with the idea to build the world’s largest digital, bio metric ID database. In 2009, the Indian government launched Aadhaar, a bio metric ID system that, since inception, enrolled 99% of India’s adult population. Described as the world’s most sophisticated ID programme by the World Bank, Aadhaar laid the foundations for the India Stack’s success.
“Aadhaar is both the only non-U.S. technical system globally to have broken the 1-billion-user threshold and the only such system to have been developed by the public sector.”HBR
Capitalising on the Momentum
Following the success of its digital ID programme, the Indian government promptly opened 10 million bank accounts using data from Aadhaar at a fraction of the previous customer acquisition cost. It then bundled incentives onto the accounts to stimulate uptake and enter millions of formerly unbankable Indians into the formal financial system. Since then, the government opened an additional 300 million no-frills bank accounts that offer zero-balance accounts, life insurance and overdrafts to millions of Indians.
Digitised bank accounts and IDs then lead to opportunities for mass mobile transacting, which the Indian government pounced on. It eliminated mountains of paperwork and bureaucracy from government services by digitising grant payments, gas and school fee subsidies, unemployment benefits and others. For a country with a vast rural population and traditionally slow-moving government processes, the impact was widely felt.
Other notable successes are India’s demonetisation of nearly 90% of its currency notes with the intention to combat rampant counterfeit and black currency markets. The drive also resulted in the inclusion of the cash-centric and largely untaxed informal economy into the country’s monetary and tax systems.
India also introduced a single, simplified and highly successful General Sales Tax (GST) to replace the incumbent 17 different codes that resulted in a complex and perforated tax system. Since inception, millions of business have registered on the system, resulting in increased transparency and data availability that opened new avenues to services for SMEs.
So What Can We Learn from India’s Digital Success Story?
India’s digital revolution holds some poignant lessons for the world. Its successes hitherto was by no means smooth sailing, with resistance from political opponents and the challenge in mobilising a population of over 1 billion making the undertaking a massively complex one. Yet, through a vision, underscored by a purpose to make the lives of its population easier, a country often divided along sectarian, religious and class lines has become a shining example of how digital transformation can reimagine societies at large.