Explained: How India can benefit a lot from data and gig economy

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Published: September 27, 2019 2:27:27 AM

While the report highlights the role of the government and Aadhaar in advancing this objective, the government needs to realise that digital innovations have worked because of a conducive regulatory ecosystem.

Monthly prices fell to 0.1% of GDP, as compared to 6.1% in 2014. (Representational image)Monthly prices fell to 0.1% of GDP, as compared to 6.1% in 2014. (Representational image)

The McKinsey Global Institute’s (MGI) new report, Digital India: Technology to transform a connected nation, shows Indians consumed 100 times more data in 2018 than they did four years ago, with average per capita consumption at 8.3GB per month. Monthly prices fell to 0.1% of GDP, as compared to 6.1% in 2014. More importantly, the report says the data economy can contribute $150 billion to the GDP—if its full potential is realised—by 2025. In logistics, automation can save 15-25% of the costs—India spends 14% of its GDP on this, higher than China and other comparator economies. The data economy is projected to result in a net addition of 20-25 million jobs.

While the report highlights the role of the government and Aadhaar in advancing this objective, the government needs to realise that digital innovations have worked because of a conducive regulatory ecosystem. The UPI instance is instructive in this matter. The government did well to introduce the technology, and ensure fast-paced progress, but had it not been for Google Pay, PayTM, PhonePe, etc, adopting it readily, the service might never have hit nearly a trillion transactions. If India is to make any meaningful progress, it needs to avoid over-regulation. Control and flow of data would be necessary for the next wave of start-ups, and enterprises to work efficiently. With many more gig economy operations emerging, and the likes of Google making a push for more, data can mean stellar growth, provided the government capitalises on it, and lets the private sector do the same.

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