It is not clear how the horrific hack witnessed across the world could have been prevented, but earlier this year, RBI’s research arm—Institute for Development and Research in Banking Technology—had published a report on the use of technology in trade finance and crypto-currencies which suggested using blockchain could help make a system more secure. And, going by a report in The Economic Times, a few Indian states are well on their way to implement it for better administration. Andhra Pradesh and Telangana have announced that they will be using the distributed ledger technology for digitisation of land records and civil supplies. While banks and markets have been quick to adopt blockchain, only a few countries like Sweden, Ghana, Estonia, Honduras and Georgia are looking into the blockchain-based registry system.
The ledger technology is more like a shared Google spreadsheet, but much more secure. Like a spreadsheet, all transactions are visible to anybody on the platform, but only those with the requisite permission can make changes to it. This is what makes blockchain reliable and faster in instituting smart contracts, and this is where it is expected to help in land registries. So, once states are able to digitise land records, government departments will key in data for each and every record title and get it verified by owners and, once everything is recorded and the database shared between departments, there would be little chance of altering it without permission.
For instance, a property title would only be transferred once the seller, buyer and various government departments digitally sign off on the smart contract. More important, as smart contracts can be saved on different networks and do not require a central server, they can be that much more secure.
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While AP and Telangana have taken the lead, the system needs a bigger backer in the form of Union government. India started land record digitisation in 2008 via its National Land Records Modernisation Programme, but in its second iteration, it has only been able to complete 611 districts across the country. While the website records 26 of the 36 states participating in the programme, only 14 had maps available on the web, while just 5 had integration with courts. Blockchain will help solve all this as it would integrate services across platforms.
More important, it would also reduce the extent of litigation. A Daksh survey conducted last year highlights that two thirds of the cases filed in the courts were related to land and property. Besides, the government has the right tools to implement this. Aadhaar can act as a verification tool for changes along with property IDs, which some states like Delhi have started issuing, while drones can make mapping easier. Integration across databases—which is what blockchain requires—is not easy, but governments will find it worth the effort.