Current context: 

DPIs to help India achieve $1 trillion digital economy by 2030.

About current context: 

  • DPIs like Aadhaar, UPI, and FASTag, which have seen exponential adoption by 2022, offer potential for further scalability in the next 7-8 years.
  • India’s economic transformation is largely attributed to DPIs, which have enabled the development of government services, platforms, market innovations, and the creation of an inclusive ecosystem.

About Digital Public Infrastructures (DPIs):

  • Digital Public Infrastructures (DPIs) are crucial tools that enable the provision of essential public services to both individuals and businesses.
  • Digital platforms serve as a foundation for building various digital solutions and facilitate seamless interactions among stakeholders.

In the context of India, the Digital Public Infrastructure (DPI), also known as India Stack, plays a pivotal role in the country’s digital transformation. Here are some key points about DPIs:

Vision and Transformation:

  • India aims to transition into a digitally empowered society and a knowledge economy.
  • The DPI model enhances the transformation by facilitating the utilization of digital technologies on a population scale.
  • The transition from offline, informal, and low-productivity systems to a single, online, formal, and high-productivity mega economy is facilitated.

Core Guiding Principles:

  • India’s DPI foundational stack is built on three core guiding principles:
  • Open APIs: DPIs provide open interfaces, allowing seamless integration and collaboration.
  • Interoperability and Consent: They ensure compatibility across systems and emphasize consent-based interactions.
  • Three Layers: DPIs consist of three layers based on identity, payments, and data. These layers facilitate the development of necessary government services and platforms.

Impact on Economy:

  • The Nasscom-Arthur D Little report titled “Digital Public Infrastructure of India – Accelerating India’s Digital Inclusion” analyzes the past, present, and future impact of DPIs on the Indian and global economy.
  • It paints a hopeful picture of an interconnected, open, and inclusive world, empowering people across the globe2.
  • In summary, DPIs are the backbone of India’s digital revolution, driving growth, inclusion, and transformation. They mediate the flow of people, money, and information, shaping a tech-ade future for India and beyond.

Key highlight of the report:

  • DPIs are expected to drive India towards a USD 1 trillion digital economy by 2030, enhancing efficiency and promoting social and financial inclusion.
  • Mature Digital Payments Infrastructures (DPIs) like Aadhaar, UPI, and FASTag have seen exponential adoption by 2022, with their economic value expected to increase to 2.9%-4.2% of India’s GDP by 2030, driven largely by the Ayushman Bharat Digital Mission.
  • India leads globally in developing Digital Payment Infrastructures (DPIs), promoting digital payments, data-sharing, and domestic business growth, fostering entrepreneurship in the country.
  • India’s digital revolution is bolstered by DPIs, enabling population-scale digital technology usage for societal and economic transformation, aiming for “India@47” milestone.

Key aspects of DPIs:

  • India’s DPI Ecosystem comprises Aadhaar, DigiYatra, DigiLocker, and UPI.
  •  Aadhaar is a policy tool for social and financial inclusion, while DigiYatra uses a Facial Recognition System for seamless travel.
  • DigiLocker has 150 million users and six billion stored documents, while UPI is the largest among NPCI-operated systems, with 8 billion transactions per month and a value of USD 180 billion.

Challenges of DPIs in India:

  • India faces a digital divide, with rural areas lacking reliable internet connectivity and digital infrastructure. 
  • The cost of accessing digital devices can be prohibitive, especially in low-income communities.
  • Language and content barriers, physical and cognitive disabilities, and privacy and security concerns also hinder access to digital services. 
  • The digital divide further exacerbates the issue, with rural areas often lacking reliable internet connectivity.

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