2017 will see companies leveraging the ecosystem which the government is trying to create. Ideas having originated since the initiative was announced will be seen in full force as they are made commercially viable.

The Digital India program was launched over a year ago in 2015. The program has now moved from the planning phase toward execution and significant progress has been made in implementation of various initiatives. However, some challenges have been faced during execution, which need to be addressed.

The Digital India program is focused on fulfilling three vision areas through 9 pillars or focus areas, which lay down objectives in areas such as skill development, e-governance, mobile/broadband connectivity, etc. These 9 pillars are supplemented by initiatives that are operating at various levels. All the initiatives have been launched and are in various phases of implementation, while significant progress has been achieved on some of these initiatives, such as Smart Cities, Jandhan, PAHAL, etc., in the last 6–12 months.

Overview of Digital Infrastructure

The information communication and technology (ICT) sector forms an essential part of the digital infrastructure requirement to ensure availability of telecom, broadband, computers, and software across the country. While with increasing reach and affordability, ICT has evolved as a basic infrastructure, India's ICT readiness has remained low, ranking 131 in the ICT Development Index in 2015. The Digital India program aims to increase the reach of digital infrastructure through an extensive broadband and mobile network in order to enable electronic delivery of government services to citizens. To enable this vision, the development of a strong digital and telecom infrastructure backbone is critical.

The government has taken several initiatives to improve the digital infrastructure in the country, which are in various stages of implementation. These initiatives extend beyond physical infrastructure and also address software and security infrastructure as all the three aspects are required in tandem to ensure the success of Digital India.

The success of Digital India depends on the creation of an ecosystem in which every citizen is digitally empowered and has access to key services made available electronically. Globally, technology has been the most important enabler in ensuring the success of such massive transformational projects. While the government has been focused on developing key technology enablers for Digital India, adoption of digital technologies has remained a challenge. It plans to use cloud technologies to enable seamless integration between various departments and delivery of services to the citizens.

Challenges Faced and Way Forward


These include:

Delay in development of infrastructure. One of the biggest challenges faced by the Digital India program is the slow progress of infrastructure development:

  • lThe BharatNet project was approved in October 2011, with a two-year implementation target. As of 2016, less than 40 percent of the target has been achieved.
  • lSpectrum availability in Indian metros is about a tenth of the same in cities in developed countries. This has put a major roadblock in providing high-speed data services.
  • lPublic Wi-Fi penetration remains low. Globally, there is one Wi-Fi hotspot for every 150 citizens. For India to reach that level of penetration, over 8 million hotspots are required, of which only about 31,000 hotspots are currently available.
  • lWhile the project has seen delays, the exercise needs to be reinforced with both funds and involvement of senior government functionaries toward making it happen on a war footing.'

Rural connectivity. For Digital India to have a large-scale impact on citizens across the nation, the digital divide needs to be addressed through last-mile connectivity in remote rural areas. Currently, over 55,000 villages remain deprived of mobile connectivity. This is largely due to the fact that providing mobile connectivity in such locations is not commercially viable for service providers.

Development of the application ecosystem. For digital technology to be accessible to every citizen, significant efforts are needed to customize apps and services to cater to local needs. Finding vendors who can provide such applications has become a challenge.

Policy framework for Digital India. Challenges in policy, such as taxation, right of way (RoW), restrictive regulations, etc., are major roadblocks in realizing the vision of Digital India.

Contracting. Implementation of the Digital India program has been hampered by contracting challenges as several projects assigned to PSUs are delayed given challenges related to skills, experience, and technical capabilities and several RFPs issued by the government are not picked up by competent private sector organizations since they are not commercially viable.

Digital literacy. Reports suggest that as recently as 2014, nearly 70 percent of Indian consumers indicated that lack of awareness was the main reason for not using Internet services. Nonavailability of digital services in local languages is also a major concern.

Data security. With the proliferation of cloud-based services like DigiLocker, data security has emerged as a major challenge. The recent data breach in August 2016, in which debit card data for more than 3.2 million subscribers was stolen, highlights the importance of implementing foolproof security systems.

Key Takeaways


Development of digital infrastructure is a critical component of Digital India. To further enable development of digital infrastructure, following measures should be considered:

Uniform policies for deploying telecom and optic fiber infrastructure. A uniform RoW policy across all states with a reasonable cost structure is required along with a single-window mechanism for granting RoW permissions. PPP models need to be explored for sustainable development of digital infrastructure, as has been the case for civic infrastructure projects like roads and metro projects. Also, the government should make efforts to make additional spectrum available to telecom service providers for deployment of high-speed data networks.

Encourage collaboration with the private sector. Effective collaboration with the private sector is critical to the development of digital infrastructure. Innovative engagement models that ensure commercial viability need to be developed jointly through consultation with industry bodies. This will encourage private sector participation and ensure a better response to infrastructure RFPs. In addition, startups need to be incentivized for development of the last-mile infrastructure and localized services and applications.

Rural infrastructure development. Existing government infrastructure assets (e.g., post offices, government buildings, CSCs) should be further leveraged for provision of digital services.

In rural and remote areas, private sector players should be incentivized to provide last-mile connectivity. USOF can be effectively used to incentivize and create a viable business model. The deployment of funds so far has been erratic and has not been used to effectively fund the cost of infrastructure creation in rural areas. Currently, the fund has over 451 billion in reserves, which can be used to finance rural digital infrastructure growth in India through direct investment or subsidies.

Use of complementary technologies. Satellite communication solutions could be used to speed up broadband access in rural and remote areas. For instance, banks can use VSAT technology to connect remote ATMs, remote branches that need instant access to customer data. It could be used as a last-mile connectivity solution in rural areas which lack telecom networks.

Capacity Building for Digital India

For the success of the Digital India program, capacity building is crucial. In addition to infrastructure development, digital literacy, skill building, and higher adoption of digital solutions is key to the success of the program.

India is rapidly evolving into one of the largest digital economies globally. The rising Internet user base in India and smartphone penetration is expected to provide accessibility to digital technologies to all sections of the population.

Digital India – Making an Impact

Digital India focuses on transforming India into a digitally empowered society and a knowledge economy, thus, impacting all facets of businesses, citizens and environment. It is projected that Digital India has the potential to provide an incremental 20–30 percent increase in GDP by 2025, resulting in an opportunity of close to USD 1 trillion annually by 2025. The impact of this program can be felt across all domains through the adoption of technology in key sectors including financial services, healthcare, agriculture, energy, infrastructure, and education.

Impacting Businesses


Digital India is likely to have a significant impact on the profitability and operations of business. Through adoption of digital technologies, companies can consolidate documentation, automate processes, and have access to efficient and cheaper ICT capabilities.

While the benefits will be realized in years to come, some of the key areas of impact are likely to be:

Increasing profitability. In India, adoption of advanced business digital technologies can lead to increase in revenues by up to 27 percent, increase in employment by up to 84 percent and enhanced access to international markets by up to 65 percent for small and medium business (SMBs). Digital infrastructure can also help leveraging technologies like telepresence that can reduce the need for business travel and result in cost savings

Higher productivity. Increased levels of digital technology use can improve employee satisfaction and collaboration, leading to a more productive workforce. In India, it is estimated that employees in SMBs with advanced digital engagement are 8.7 times more likely to collaborate than offline businesses.

Ease-of-doing-business. The government has taken several measures to improve ease-of-doing business in India. Consequently, India has seen an improvement in the global ranking for ease-of-doing business. Services such as eBiz portal, KYC, and other e-governance initiatives have started to contribute to the improvement in ease-of-doing business, and this is expected to improve further.

Faster time-to-market. Availability of digital infrastructure will help companies drive significant efficiencies, reduce time-to-market (new products, new markets) by digitizing their core operations and supply chains.

Investment. The vision and initiatives toward Digital India are expected to boost investment in the digital space in the short term and lead to rise in digital innovation, efficiency, and productivity in the long term. Currently, a number of domestic and global companies have announced investments in the digital space in India.

The Digital India program is now in the second year of its existence and several of the flagship projects under the program have now moved from the planning phase to the execution phase. While the usage of smartphones and the Internet has increased, digital literacy and awareness is still low, and is an area that requires enhanced focus. To further strengthen the development of infrastructure, services, capacity building, and enhance their impact, the government needs to take steps across multiple functional areas, some of which are:

Increase availability of digital infrastructure at rural and remote locations. The speed at which digital infrastructure (especially fiber networks) is being developed needs to be increased. Existing government infrastructure assets (e.g., post offices, government buildings, CSCs) should be further leveraged for provision of digital services at remote locations.

Improve digital literacy. Digital literacy needs to be increased by providing institutional trainings in schools, colleges, and universities, and accelerating partnerships with global technology leaders and using the workforce trained under Skill India to impart trainings. An integrated approach between Digital India and Skill India needs to be constructed to design programs and impart training.

Create awareness on the benefits of digital services. The government should increase awareness regarding the value-add of technology to increase technology adoption. The benefits of technology such as increase in the standard of living of the weaker sections of society and enhancing financial inclusion should be communicated to citizens.

Provide incentives for greater participation from private players and startups. Private sector players should be incentivized to develop infrastructure, provide services, and promote digital literacy as part of the Digital India program. Startups should be involved to create and customize apps to local needs to increase adoption of digital technology.

Based on a Deloitte-Assocham Report released in November 2016

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