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