1. Digital India and India’s digital score

Digital India and India’s digital score

The parameters chosen for the formulation of the ICT Development Index are not benchmarked with the requirements of developing economies

By: and | Published: July 10, 2015 12:22 AM

Taking forward the promise of making India a better governed place, the government has launched the Digital India initiative. While vast empirical literature exists on the role of ICT on growth in developed economies, its potential as a development enabler in the context of developing economies remains unexplored. Fortunately, it is now being recognised by policy-makers, researchers and funding organisations that ICT can make a difference to the dimensions covered in the MDGs like poverty reduction, food security and health.

Often, ICT penetration is measured by the ICT Development Index (IDI), as reported by the International Telecommunication Union (ITU). Grouped by three sub-indices—access, use and skills—IDI is constructed from 11 indicators. The index is widely recognised by governments, UN agencies and industry as the most accurate and impartial measure of ICT development. India has been ranked at 129 as per IDI 2013. Regrettably, India’s rank has fallen from 116 in 2007 to 129 in 2013. Then there is a huge gap between the absolute value of India’s IDI (2.53) vis-a-vis Denmark’s index (8.78) that ranks the top. Amongst BRICS too, India ranks the lowest—the ranks for Russia, Brazil, China and South Africa are 42, 65, 86 and 90. A UN report Promoting ICT for Human Development:

Realizing the Millennium Development Goals was one of the first attempts to systematically assess the role and impact of ICT on human development. In this regard, the role of the state cannot be overlooked, especially in countries with sharp social, economic, digital and geographic divides. So, Digital India is expected to improve India’s rank and absolute score on ICT development.

While the estimation of IDI remains useful for researchers and policy-makers, it needs to be interpreted with caution. Often, for developing economies like India, the index is likely to be an underestimate, thereby leading to lower country ranking than would otherwise be the case. In fact, there are some methodological flaws.

One, the ICT access sub-index is used to capture ICT readiness and includes five indicators (fixed telephone subscriptions, mobile cellular telephone subscriptions, international internet bandwidth per internet user, percentage of households with a computer, and percentage of households with internet access). The parameter ‘fixed telephone subscriptions’ maps the number of fixed telephone subscribers per 100 inhabitants. For a country like India this value is much lower than that for the advanced economies. However, what the ITU has missed out is the shared usage of fixed telephone subscriptions by means of community STD booths that are used by large segments of the population in less developed economies. The mushrooming of such STD booths in India is a testimony to their popularity. High population density necessitates incorporation of a parameter that captures the number of people making fixed telephone calls from shared fixed telephone connections, while mapping ICT penetration. Needless to say, such inclusion is expected to improve India’s IDI rankings.

The second anomaly lies with the parameter ‘percentage of households with internet access’. The proliferation of internet cafes in small towns has been filling the gap for a vast majority who don’t have internet connectivity at home. Corporate initiatives such as e-Choupal have given millions of farmers access to latest market rates for crops.

Numerous government initiatives such as Gyandoot and e-Seva have proved that having an internet connection at home is not essential for leveraging benefits of ICT.

Third important ICT service which has not been mapped in IDI is the use of SMS. Initiatives such as SMS-based crop and weather alerts and SMS-based DBT of subsidies are examples of leveraging ICT for the masses who may not have dedicated access to computers or the internet. The ICT index ignores this too. Another observation is with respect to internet bandwidth. Countries have been assessed on the parameter internet bandwidth per internet user with a reference value of 787 kbps. While this kind of bandwidth is desirable for streaming of videos and content-heavy applications, it is not required for successful implementation of e-governance initiatives that work with basic internet bandwidth. Thus taking 787 kbps as the reference value has, unjustifiably, lowered the ranking of many developing nations. If due cognisance is given to these issues, there is likely to be major jump in the rankings of most developing countries.

It remains obvious that the parameters chosen for the formulation of IDI are better benchmarked with the requirements of developed economies, thereby missing out the nuances of ICT usage in developing economies.

Consequently, any research or policy-making based on the current IDI methodology should be taken with a pinch of salt. While Digital India is likely to improve the availability of ICT infrastructure, it does not necessarily imply accessibility, and hence affordability too has to be ensured.

Kaur is professor of Public Policy, FMS, Delhi. Navlani is a research scholar, All India Management Association

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  1. B
    Bhavishya
    Jul 12, 2015 at 6:41 pm
    Well written, with proliferation of mobile phones in our country & reaching 1 billion mark last month the complete process of evaluation needs to evolve too..
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      H S
      Jul 12, 2015 at 9:44 pm
      A well researched and informative article. Its true that ICT development index are not benchmarked with the parameters of developing nations.
      Reply
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        anjali Khanna
        Jul 12, 2015 at 2:16 pm
        Excellent analysis of the parameters for measurement of IDI.
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        1. H
          Hardeep kumar
          Jul 12, 2015 at 3:09 pm
          Lead the idea with idea
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          1. P
            Pankhuri bhatnagar
            Jul 12, 2015 at 6:28 pm
            Great work..extensive thoughts. Well appreciated. Very informative
            Reply
            1. P
              Paulson
              Jul 12, 2015 at 2:55 pm
              Great piece
              Reply
              1. P
                Prateek singh
                Jul 12, 2015 at 5:34 pm
                Great one
                Reply
                1. P
                  Pratul Swarup
                  Jul 12, 2015 at 9:50 pm
                  Very well written article, as mentioned gives insight and in depth information and makes our grey cells work / think in the right focussed direction. It is a well researched and composed article which makes us non -finance guys also to develop some understanding about this so important and critical topic for our Country. Thanks and best regards.
                  Reply
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                    Atul Sehgal
                    Jul 12, 2015 at 4:19 pm
                    Cannot agree more Naveen. Most of such studies are biased towards Western or developed exonomies, for them to make real sense in developing economies, local factors must be considered and accounted for ... Without these factors in consideration, the results may be very lopsided and may not be relevant ...
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                      Anupam
                      Jul 12, 2015 at 8:54 pm
                      Well Researched and balanced piece. Any step in the positive direction is better than nothing. ...... challenges not withstanding. That's the hallmark of a young nation willing to take on the it's own challenges. Proud of us. Jai Hind.
                      Reply
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                        Advitya Sapra
                        Jul 12, 2015 at 10:16 pm
                        A well researched article with pertinent lessons.
                        Reply
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                          Amar
                          Jul 13, 2015 at 6:24 am
                          A few questions Why are we interested in getting a higher place on an index which is primarily based on developed low poted countries? Can india provide free internet ? May not be across the streets but definitely at kiosks, subsidise existing places or use post offices,libraries,primary health care centres etc. This will force the villagers to get acquainted worth the govt policies while they use the facebook! Can the govt widen the tax base , now that most of the potion has registered for life insurance Or for the aadhar card and for the nya samriddhi acct. Most of the beneficiaries are rich farmers who are enjoying freebies because of the profession but are actually well to do.
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                            Amit Bhatnagar
                            Jul 13, 2015 at 8:20 am
                            Mr Navlani seems to have done indepth research on subject to bring such a complete financial column which highlights grey areas clearly even fm will appreciate the insight
                            Reply
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                              Sabut
                              Jul 12, 2015 at 11:37 pm
                              Agree with the authors on the applicability of ITU-T model for a developing country like India. There is no necessity of including penetration of fixed telephony on the index, as it is economically makes no sense. Similarly, broadband speed when we have 3G/4G telephony makes no meaning. Good article.
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                                Anupam Bhattacharjee
                                Jul 12, 2015 at 2:44 pm
                                Very well articulated. Kuddos.
                                Reply
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                                  Vinod
                                  Jul 12, 2015 at 6:53 pm
                                  ICT index as data point is indication of country's communications infrastructure. However its exploitation to country's development is indicator of innovations of its people. In EM these are important issues need to be considered.May be there is need to extend the indicator to include exploitation of infrastructure.
                                  Reply
                                  1. V
                                    Vikas Bhardwaj
                                    Jul 14, 2015 at 7:36 am
                                    Some articles make you sit up and take notice. This one forces me to wish that if we can have a BRICS Bank to counter IMF, why not have a G20 ICT Index to capture the developing countries data better? GOI should invest in developing own index to benchmark its development post the efforts initiated for Digital India
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                                      Manoj
                                      Jul 12, 2015 at 10:46 pm
                                      Very useful and pertinent points highlighted in this article to be taken note of by the policy makers and experts alike. Digital revolution shall bring dividend if such points of view is also incorporated. Good article.
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                                        C P
                                        Jul 12, 2015 at 3:16 pm
                                        Nice piece....
                                        Reply
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                                          Dinesh Singh
                                          Jul 12, 2015 at 4:11 pm
                                          A lot of indexes needs to be revisited as nowadays a lot of developing economies have a major share in the overall world economy.Agreed that these indexes can't be followed blindly for policy formulation.
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                                            Dr Manish
                                            Jul 12, 2015 at 3:47 pm
                                            Must Read this piece of research which gives a real and factual insight on recent developments in ICT.
                                            Reply
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