The government’s recently unveiled Digital India initiative aims at creating a knowledge economy by implementing schemes spanning broadband highways, e-governance, domestic manufacturing, and universal access to internet. The successful implementation of the programme, however, requires an enabling infrastructure. Also, an encouraging ecosystem needs to be created wherein all stakeholders operate in sync with the government. Industry experts comment on the feasibility of the Digital India initiative and the likely challenges…

What are your views on the recently announced Digital India programme? What are its key features and how realistic are its aims?

Bharat Bhargava

The recently announced Digital India initiative is said to be “a programme to transform India into a digitally empowered society and knowledge economy”. It aims at “making technology central to enable change” and “bringing in public accountability through the mandated delivery of government services electronically”. It is structured around three pillars:

• Infrastructure as a utility for every citizen: Making digital identities, mobile phones, bank accounts and high speed internet core utilities in all gram panchayats.
• Governance and services on demand: The availability of real-time services on online and mobile platforms, electronic and cashless financial transactions, and the seamless integration of departments to provide an easy, single-window access for people and businesses.
• Digital empowerment of citizens: Universal digital literacy and availability of documents and certificates on the cloud.

The government has laid down a roadmap for transforming the digital identity of the country and proposed a number of measures to achieve this goal. Bringing all existing schemes under a single umbrella and defining it under a central programme makes efforts more focused and goal-oriented. Restructuring and refocusing on existing schemes for implementation in a synchronised manner is also an effective way to achieve the programme’s aims, and defining a centralised monitoring plan will streamline the decision-making process.

Some key targets of the programme include connecting 250,000 villages by broadband and phones; reducing telecom imports; providing Wi-Fi in 250,000 schools and all universities and public Wi-Fi hotspots for citizens; creating 17 million direct and 85 million indirect jobs; and training 17 million citizens for IT, telecom and electronics jobs.

Hemant M. Joshi

The key vision areas of the programme include accelerating the delayed National Optical Fibre Network (NOFN) project; providing effective connections to citizens and enabling them to give direct feedback; setting up digital classrooms, connected universities and research and development institutes; setting up fast and efficient e-governance; ensuring digital literacy of citizens; establishing smart cities (to put India on a global platform); and increasing GDP growth. According to a World Bank study, a 10 per cent increase in broadband penetration increases the per capita GDP in developing countries by 1.38 per cent.

Rajan S. Mathews

Digital India is an ambitious programme of the Indian government to prepare the country for a knowledge economy. The focus of this programme is on implementing the vision of “less government, more governance”, which basically means leveraging IT for bringing efficiency and transparency into the functioning of government departments. This is based on nine broad pillars of delivery, namely, broadband highways, universal access to phones, public internet access programmes, e-governance, eKranti (electronic delivery of services), information for all, electronics manufacturing, IT for jobs, and early harvest programmes. The concept of broadband highways envisages a nationwide national information infrastructure and extensive coverage in both rural and urban areas by 2017. Connectivity is to be provided to more than 42,300 villages so that there are no coverage gaps in administrative implementation by the government. Simultaneously, Common Service Centres are to be made available across 250,000 villages across the country by March 2017, and 150,000 post offices are to be connected as multi-service centres to serve citizens.

The implementation of this massive programme, however, will depend on the creation of enabling infrastructure. In order to facilitate countrywide broadband services, the expansion of networks and service penetration of areas is imperative. There is a need to harmonise site approvals and right-of-way (RoW) procedures to lower costs and expedite implementation.

eKranti is another ambitious agenda which aims at delivering services such as education, health, agriculture, banking and finance, and security through mobile broadband. While several trials and models are being studied, traction is yet to be achieved in creating viable economics and commercials to scale these up.

The use of wireless for providing last mile broadband access is critical. In addition to backhaul, such access requires a large number of towers and small cells. Non-discriminatory access to government land and street infrastructure (street lights, etc.) for putting up such towers and small cells is needed. In order to improve the efficiency of resources and reach the masses, such infrastructure should be allowed to be deployed, especially if it is shared among two or more broadband service providers.

To achieve the broadband vision set out for India, demand-side considerations are as vital as supply-side constraints. If the socio-economic benefits of broadband are to be realised, then its adoption needs to be actively encouraged. More and more content should be brought to India, which will bring down its costs and also improve utilisation efficiency. The government should devise schemes to enhance domestic content and thereby reduce the dependence on an international bandwidth.

How is the programme likely to affect the telecom sector in general and private players in particular? What role does it envisage for private players?

Bharat Bhargava

Given the scope and scale of the programme, there are potential benefits for a number of sectors like IT and telecom. With a planned outlay of Rs 1,130 billion (Rs 1,000 billion for ongoing schemes and Rs 130 billion for new schemes), the programme provides significant opportunities for the telecom sector. Given the targets set out by the government in terms of reach and accessibility, its successful implementation will require strong public-private partnerships in the creation of last mile infrastructure for villages as part of the NOFN project (which will form the programme’s backbone). In addition, the push towards m-banking and financial transaction services, the cloud, and the creation of relevant content will require the extensive participation of private players.

Hemant M. Joshi

The programme offers telecom players higher revenue opportunities. It will give them access to the untapped rural market (agriculture, education, healthcare, e-governance, retail, etc.) and open up new business opportunities in the urban market (e-commerce, healthcare, education, banking, information, etc.). In general, the telecom sector is likely to benefit as the programme envisages new segment penetration including M2M, retail, data centres, cloud computing and big-data analytics.

Rajan S. Mathews

The key ingredient for success is an effective partnership between the government and the industry to create and ensure the efficient functioning of the infrastructure that will facilitate the objectives outlined in the programme.

Broadband can provide access to immense information, employment generation, better medical facilities, and business opportunities for the rural population. The low broadband penetration in non-top tier areas can be viewed as a market opportunity provided systematic imperatives are made available to operators. This would also mean that innovative business models will have to be encouraged to provide a fillip to the commercially sustainable provision of services.

Given the massive scale of the programme, the participation of telecom companies in the private sector is inevitable. All stakeholders of the telecom value chain – from telecom and broadband service providers to network equipment providers to end-user equipment providers – will have to be involved for the successful implementation of the initiative.

How is it likely to affect the dynamics of the NOFN project?

Bharat Bhargava

The NOFN project, which was expected to be completed by October 2013, has seen multiple delays, particularly on account of the challenges in obtaining administrative clearances and RoW approvals at the state government level.

Restructuring the NOFN project under the Digital India programme will help weave it into the comprehensive vision of the programme and address its key issues in a timely manner. The monitoring structure envisaged under the programme will ensure the timely monitoring of the project’s implementation.

Hemant M. Joshi

The programme can lead to the accelerated development of the NOFN project through greater private participation. All other projects like connecting universities, creating smart classrooms, smart cities, smart grids, etc., depend on the NOFN. These projects need a robust, reliable and sustainable backhaul, which can be provided by the NOFN.

Rajan S. Mathews

A countrywide professionally implemented national backbone network can surely act as a great catalyst for broadband penetration. However, the issue with the NOFN is that the scheme is not holistic or comprehensive and hence is not able to take off properly.

While there can be some tweaks in the process, overall, the NOFN project will work in line with the Digital India programme, as the former deals with the provision of infrastructure for the latter. There is a need to review the entire scheme and take corrective measures at this very stage. The NOFN needs to approach potential customers like private telecom operators, internet service providers, etc. to get their requirements, and then plan the network. The basic need is to align requirements with businesses and then build this network to optimise its usage. Besides laying out the NOFN or similar projects, what will be equally important is an accompanying institutional mechanism that will enable cost-based, non-discriminatory access to the NOFN. Physical access to the network should be enabled through a single-window mechanism with stipulated time frames that will ensure increased usage from all operators and higher usage of the NOFN.

What are the best possible approaches and models for implementing the programme?

Bharat Bhargava

Stage-wise monitoring and centralised decision-making will be vital for the success of the Digital India programme. Setting down interim milestones is a positive step, and tracking these goals and maintaining a transparent implementation status will be imperative. The project allocation should be merit-based and private sector participation must be encouraged to make the project all-inclusive. Laying out transparent and open-for-all bidding processes for projects is also important. The project plans that aim at timely delivery and also take into account commercial viability for bidders will be imperative for drawing the participation of the public and private sectors.

Hemant M. Joshi

The following approaches and models can be considered:

• Public-private-participation (joint venture model).
• Breaking the programme into different segments and allocating them to different state-owned and private players.
• Frequent monitoring and project management, taking into account the time taken, quality of materials, funds spent, and efficiency.

Rajan S. Mathews

The Digital India programme is heavily based on the growth of mobile broadband. For all such technologies to be deployed effectively, the most important requirement is the availability of a sufficient quantity of globally harmonised spectrum in a contiguous manner per operator. For this, the release of additional spectrum in the relevant bands is imperative. Operators in India have far less spectrum than their global peers, which have achieved high mobile broadband penetration.

Thus, there is an urgent need for increasing spectrum availability, which will contribute to the affordability of services, while the harmonisation of spectrum will allow a lower-cost device ecosystem to evolve. Further, there is the need for a reasonably priced large quantum of contiguous spectrum to build the Vision of Digital India with a focus on broadband highways.

It is also essential to notify guidelines for spectrum trading and spectrum sharing to facilitate the optimal use of this scarce resource.

What are the major loopholes and weak points of the programme?

Bharat Bhargava

While the Digital India programme is transformational in nature and aims to change the way businesses and citizens engage with the government, there may be some challenges that will need to be addressed. Given the high capital investment that is required, the arrangement of financial resources for the programme will be critical. Its successful implementation will require an effective coordination between central and state governments and agencies and the grant of permissions and approvals in a timely manner. Close supervision and monitoring of programme deadlines and the timely resolution of issues will be critical.

Hemant M. Joshi

Some of the key loopholes and challenges pertain to high costs of user equipment like modems, splitters, PCs and smartphones; high internet tariffs; and low broadband speed (512 kbps) for data-intensive applications like video calling and streaming. There is also no mention of any plans for last mile connections (like the availability of copper loops for wired broadband). The electricity supply in rural areas and lack of computer and internet literacy could also pose problems. Low ARPUs, adoption rates and complex policies might keep private players away, and there could also be security-related issues. The limited availability of relevant localised and regional content and user-friendly applications (for banking, ticketing, etc.) are the other possible hindrances.

Rajan S. Mathews

The government has set bold policy objectives of building broadband highways and a digital India, both of which require long- term and extensive investments in telecom infrastructure. We understand that a budget of Rs 700 billion till 2019 has been approved for telecom and IT to roll out a broadband network to connect 250,000 village panchayats (Rs 320 billion) and  provide mobile connectivity to 42,300 uncovered villages by 2018 (Rs 160 billion).