In a few months, India will take over the presidency of Group of 20 (G20) nations from Indonesia. Amidst global turmoil, India will be expected to shoulder the responsibility of steering the global economic dialogue platform towards the benefit of the region as well as the nation itself. The growing importance and affluence of India is already recognized by most countries, and this will be the perfect opportunity for India to finally lead by example. What makes this even more interesting is that this opportunity comes at a time when the Government is trying to make India a US$ 1 trillion digital economy through its 1000-day plan.
As India works on building and achieving Vision 2047, the world will be looking at India to lead the platform through one of its most divisive and difficult phases, owing to the ongoing crises between Russia and Ukraine. If India is to transform into a global economic superpower and knowledge economy, now is the time to rise and lead. The Digital India that we have been so carefully building for nearly a decade, will finally be able to take the inclusive development model to the world. At a domestic level, we will need to step up as well to achieve all the goals and fulfil the vision of a digitally empowered society.
In 2014, when Narendra Modi took charge as the Prime Minister of India on the promise of rapid development and inclusive economic growth, not many people could have envisioned the kind of transformative changes the country would go through in the coming years. 8 years on, the Prime Minister recently launched the Digital India Week 2022 in Gujarat, launching new digital initiatives and celebrating the success of initiatives started earlier. The Prime Minister had also previously spoken about a smartphone in the hand of every Indian and a drone over every field. Back in 2014, it was unfathomable. To put things into perspective, 4G was just being commercialized in India and smartphones were owned only by people with good purchasing power. The average data tariffs were INR 33 per GB of data. In that light, we certainly have come a long way, but are we anywhere closer to what we set out to achieve?
The PM’s 8 years of development agenda have been riding on the digital transformation wave. He has repeatedly reaffirmed that India will develop on the back of digital technology that is low-cost, inclusive, made in India and innovative. It is the last attribute that has been stressed on the most: innovation-led growth, innovation-first, and youth-innovation. Although the Government has spent heavily on infrastructure, the focus has always been on continuous innovation that can put India on the global technology map. With that idea, the celebration with the theme of ‘Catalyzing New India’s Techade’ was aimed at transforming the nation into a digitally empowered society and knowledge economy.
The unshakable focus on the Digital India transformation has indeed made India more desirable for investors and more fertile for breeding new startups. India now has more than 100 unicorns and places India in the third position of countries with most startups that were valued at US$ 1 billion or more. With supportive policies & focus on more investments, we should be able to overtake China and the United States; the latter has more than 8 times the number of unicorns. India is certainly catching up, but a lot still needs to be done to narrow the gap between India and the top 2. As the Digital India programme completes its 7 years, here are 7 things that will propel the Digital India programme into hyperdrive and transform India into an economic superpower in the next 7 years.
First, new regulatory models that work for new digital-only or digital-first businesses. As all businesses look to pivot to online in a bid to deliver services remotely to people in different locations, we need regulation that works for these businesses. This would include information campaigns and education of every stakeholder involved, major capacity building of the regulators with proper understanding of the digital businesses, and inculcation of a scientific temper throughout the regulatory ecosystem. Online businesses simply cannot be measured with the same yardstick that physical, on-ground business can.
Second, sustainable policy ecosystems to drive more investments is an absolute must, and for a number of reasons. Stability is important for investor and founder confidence. If a founder or investor doesn’t feel confident regarding putting their time, effort, and money into something, they are probably not going to do it. We have seen that with the gaming industry where the investments have dried up post blanket bans in certain states. This is also leading to businesses moving abroad in search for more stable policy ecosystems. This migration needs to stop, and capital and talent outflow needs to be retained. We are fast approaching a time where we will have to pick between strict regulation and boundless innovation.
Third, reduction of entry barriers for new businesses and entrepreneurs is also critical. This ties into the first recommendation but must be dealt with as a separate issue. As we know, competition is an absolute necessity for innovation, and we need as many people as possible to come up with new business models, new products, and new ideas frequently to stay ahead of the curve. However, regulation and licensing regimes can make it an absolute nightmare for young engineers and entrepreneurs trying to launch their products or starting their businesses. From further simplification of business registration to easing of the various requirements for launching a product or service in the market, unless we support our young minds, it’s very hard for them to innovate.
Fourth, we desperately need new models of wealth generation and employment to fight youth disillusionment. Government and private sector jobs are just not sufficient to meet the requirements of a growing population. We will need to support and promote businesses that can make people self-sufficient, for example, content creation, streaming and gaming. The latter can be very lucrative for skilled professional gamers through national and international tournaments.
Fifth, we will have to find new ways to skill, re-skill and upskill the existing workforce to prepare them to work with technologies of the future. As manual jobs are replaced by automation, we will need those workers to be upskilled to handle more complex roles and responsibilities. According to an estimate by WEF, nearly half of the world’s workforce will need to be upskilled by 2025. And it should concern us as a nation as investing in skills will add US$ 8.3 trillion to the global economy by 2030. We simply cannot miss this opportunity.
Sixth, there must be an increased focus on physical and mental well-being of our people. The Union government’s “Digital Yoga” initiative is a step in the right direction, but a lot more needs to be done, especially for mental health, which is still being neglected at a policy level. A Lancet study showed that poor mental health was costing the world economy US$ 2.5 trillion per year & the cost is expected to double by 2030. If the business phrase, “money saved in money earned” holds any value, it becomes imperative to work actively on improving the mental health of our people.
Seventh, we need renewed respect for research & development at a national level. Researchers are some of the worst paid employees in India, whereas, in countries with best research outputs, they are some of the best paid. The correlation is not incidental: exceptional talent needs exceptional remuneration. Businesses need to be incentivised to invest more in research & development. This can be done through tax incentives, for example, any part of the revenue reinvested in R&D could be made tax free and directly linked to research outcomes. This would be one of the most progressive steps that the governments can take towards promoting innovation.
The Digital India program is probably the most progressive, reformative, and transformative initiative since globalisation of the Indian economy. But unlike the opening of the economy, digital transformation of the nation can take years if not decades; bridging the digital divide, improving access and adoption, and ensuring privacy and safety while doing so will need a colossal effort from all stakeholders. While the push for the transformation has resulted in a lot of technological progress in the last 7 years, further progress in the next seven years will depend entirely on policy support and collaborations. As we complete our 1000-day journey to US$ 1 trillion economy or start with new digital initiatives such as Digital India Bhashini and Digital India Genesis that were announced at the Digital India Week 2022, all eyes will be on the policy framework to support these and many other initiatives that will serve the country so well.
Views expressed above are the author’s own.
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