India has reached an inflection point on tech policy

India has reached an inflection point on tech policy. <br>The private tech sector is a mainstay of India’s economy, and will likely drive India’s growth for the foreseeable future. Tech is a key part of the government’s plan to create 25 million jobs and double the size of India’s economy to $5 trillion by 2025. Prime Minister Modi has proactively courted tech companies and founders/CEOs like Elon Musk and Mark Zuckerberg. <br><br>India has made progress on tech policy. The election of 2014 was the first in which all Indian voters could use electronic voting machines. GSM mobile phones are ubiquitous. India’s digital identity program is world-class. Biometric data is used for passport renewals, health and automobile insurance, and even for bounced checks. <br><br>But the digital payments, data localization/privacy, and AI policies are not good. The Indian government also infamously shut down the internet 109 times in 2022 alone, almost always due to a real or perceived law and order problem. <br><br>The main problem in tech policy is that India doesn’t really have one. We can’t even have a reasonable discussion about how to fix these problems because we don’t know what the government wants—far less how to get there. For example, Digital India was launched in 2015, with no clear plan as to what it means to create a “digital India.” <br><br>Therefore, this paper provides a vision for tech policy in India. The paper addresses three questions. <br><br>First, what should be the objective function of tech policy in India? In other words, what should we want tech to solve? The answer cannot be a generic “it’s good.” We need to think more clearly, both about what tech can realistically do, and how that progress measures up against Indian priorities like poverty, inequality, hunger, or climate change. <br><br>Second, what are the key challenges in using tech to address India’s sustainable development priorities? Here again, the answer is not a generic “it’s bad.” Rather, we need to think more clearly about what specific obstacles governments, companies, and civil society organizations face. <br><br>Third, what levers should the government use to overcome these challenges? For example, should the government prioritize investing in digital literacy? Creating public goods like a government-owned 5G spectrum? The government certainly has an important role. But it isn’t the only entity. How should the government work with the private sector? Civil society? What kind of regulation is necessary? <br><br>This paper is divided into three sections. Section 1 argues that the government should want technology to solve three key areas of sustainable development. Section 2 argues that firms, government, and civil society face six key challenges in using tech for development. Section 3 outlines a clear vision for tech policy in India. In particular, the government should govern tech as a public good, much like education and healthcare. The paper concludes by outlining how Indian policymakers can operationalize these recommendations. <br><br>**Three Key Areas of Sustainable Development** <br><br>In the Indian context, tech should solve three key areas of sustainable development: (1) health, (2) education/workforce development, and (3) climate change. <br><br>\* Health. From 2015 to 2019, India made great progress on health indicators, including a 40% decline in TB infections and a 41% decline in deaths from heart disease. But that progress appears to have been reversed—far worse than the reversals seen in other developing countries—due to the COVID-19 pandemic. Downward revisions to child vaccination and TB infection rates were particularly stark: the proportion of children who are fully vaccinated with routine vaccines declined from 90% to 57%, while the number of TB infections increased from 1.6 million to 2.3 million. <br><br>\* Education/workforce development. India dropped out of the Human Development Index entirely in 2022. Only 3 in 10 Indians have the skills for the modern workforce, and only 10% of Indians (mostly from the Brahmin and Kshatriya castes) have the basic skills necessary to succeed in the modern global economy. <br> <br><br>\* Climate change. Climate-related disasters have become extremely common. For example, Cyclone Fani hit India in May 2019. Cyclone Amphan hit India just over a year later in May 2020. Cyclone Tauktae hit India in May 2021. Cyclone Sitrang hit India in October 2022. <br> <br><br>In each of these areas, the data are bleak. Digitalization could help turn the corner in all three. But the digitalization program has stalled. For example, digital payments grew extremely quickly in the early years after demonetization, from 1 billion transactions in October 2016 to 2.5 billion transactions in October 2017. But the growth stalled in 2018 and has bounced around 3 billion transactions since. <br><br>**Six Key Challenges** <br><br>Firms, government, and civil society face six key challenges when it comes to digitalization for development. <br><br>First, the digital divide is crippling. <br> <br><br>By 2023, the average Indian will have 6.6 devices connected to the internet. The total number of internet users in India will approach 900 million. The number of people connected to the internet in India will soon surpass the number of people connected to the internet in the United States. <br> <br><br>But the numbers don’t add up. The numbers are based on faulty assumptions, and—more importantly—are disconnected from Indian reality. Many devices are connected to the internet, but aren’t actually in use. For example, Indians who own a smartphone are far more likely to own a second (or even a third) smartphone than the 300 million Indians who don’t own even one. So the average number of devices owned per capita is skewed by the number of devices owned by Indians at the top of the income quintile distribution, and the fact that the vast majority of Indians at the bottom of the distribution don’t own any. <br><br>Second, the digital divide is also insidious. <br> <br><br>The Indian digital divide is far more insidious than the American one. First, the divide is along more axes. The main divides are caste, class, age, education, and geography. For example, 45% of upper caste Indians own a smartphone, compared to 37% of Other Backward Classes and just 25% of Dalits and Adivasis. Only 10% of farmers own a smartphone, while 60% of Indians with high-skilled, salaried jobs do. In some states, including Uttarakhand and Haryana, over half of residents own a smartphone. In others, including Bihar and Jharkhand, fewer than 1 in 3 residents own a smartphone. Second, the divides are far more stark. For example, while there is a large gap between the 95% of wealthy Americans who own a smartphone and the 71% of poor Americans who own a smartphone, it is dwarfed by the gap between wealthy Indians (62%) and poor Indians (15%). <br><br>Third, tech companies have not been a solutions provider in the Indian context. Sometimes (as with vaccine passports), they are actively malignant. In other cases (like digital education or climate monitoring, or even just digital payments), they just don’t show up. <br><br>Fourth, policymakers are not using data to drive tech policy. For example, only 11% of Indians have the digital literacy needed to succeed in the modern workforce. The Republic of Korea and Singapore have programs for digital literacy. So do Portugal and Czech Republic. India is at a comparative disadvantage to all of these countries. No one in government appears to know, or know what to do about it. <br><br>Fifth, policymakers don’t know how to regulate tech companies. For example, the government has proposed a ban on cryptocurrencies. But the government has no idea how (or even if) it can actually enforce the ban, particularly for cryptocurrencies that are decentralized in the way that Bitcoin is. <br><br>Finally, tech is being used to undermine democracy. The Election Commission of India is a perfect example. Prior to the election of 2014, India—like most countries—used paper ballots. The election of 2014 was the first in which all Indian voters could use electronic voting machines. But the Election Commission of India did not have a strategy for how to do the relatively simple (but very important) work of keeping the electronic voting machines safe from tampering or cyberattacks. <br><br>**The Government Should Govern Tech as a Public Good** <br><br>Based on these three sustainable development priorities and six challenges, this paper argues that the government should govern tech as a public good. By that, I mean that the government should think about tech in the same way it thinks about healthcare and education: as essential public services. <br><br>There are two themes from public goods that the government could borrow to address tech policy. <br><br>First, the government should think about tech as being merit goods. The idea behind merit goods is that governments should prioritize access to certain goods and services because they are essentially in the public interest. For example, governments should prioritize universal access to healthcare and education. In tech, governments should prioritize access to digital payments and AI. Governments should also invest in creating digital public goods like open-source software and data. <br><br>Second, the government should think about tech as being common-pool resources. The idea behind common-pool resources is that they are scarce, and therefore need to be managed for the public good. In tech, this means greater oversight of digital divides, tech companies, and AI. It also means safeguarding Indians’ digital rights and freedoms. <br><br>Based on these two themes, this paper concludes by outlining a clear vision for tech policy in India. <br><br>**Open-Source Software and Data** <br><br>The government should prioritize open-source software and data as a key digital public good. <br><br>First, the government should create a public repository of open