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Nasscom – Arthur D Little India’s Digital Public Infrastructure – Accelerating India’s Digital Inclusion

February 21, 2024 1283 3 Digital Transformation

Nasscom – Arthur D Little India’s Digital Public Infrastructure – Accelerating India’s Digital Inclusion

The world has witnessed India’s massive transformation over the last several years, driven by digital revolution at the core of its economic growth, with a vision to make India into a digitally empowered society and knowledge economy. India is leapfrogging from offline, informal, low productivity to a single, online, formal, high productivity mega economy. The foundation of this digital revolution has been strengthened by the Digital Public Infrastructure (DPIs) or India Stack, enhancing the ability of the country to use digital technologies at a population scale to change the society. DPIs form the cornerstone to shape this “tech-ade” and ultimately drive the “India@47” growth path. The DPI model is unique, interoperable, collaborative, equitable, with the inclusive principle that every citizen in the most inaccessible corner of the country has the same opportunity as everyone else. The Nasscom-Arthur D Little report titled “Digital Public Infrastructure of India - Accelerating India’s Digital Inclusion” is a first-of-its kind report, providing a holistic view of the Indian DPI ecosystem, analyzing the past, present, and the future impact that these DPIs will have on the Indian and global economy. This report highlights the possibilities of the vast potential that DPIs hold in revolutionizing the entire Indian economy and the world and paints a hopeful picture of an interconnected, open, inclusive world with infinite possibilities, empowering each and every one across the globe.

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Key Findings

  • 3 core guiding principles

India’s DPI foundational stack has been built on 3 core guiding principles- they have open APIs, are interoperable and based on consent, and consist of 3 layers based on identity, payments and data which have facilitated the development of necessary government services & platforms. Private players have also participated by building business models using some of these DPIs. The foundation of DPIs is based on the underlying principle of trust on the infrastructure and stakeholders.

 

  • DPI Maturity Framework –

To analyze the impact of DPIs on India’s economy, Arthur D Little has designed a ‘Maturity Framework’ built on components such as – Recency, Indirect benefits, Direct benefits in transaction value and volume, Total Addressable Market (TAM), and reach of each DPI as a % of TAM.  When evaluated methodically, there is a clear clustering of ‘matured digital entities’ with successful mass adoption and larger economic impact & ‘budding digital entities’ with successful proofs of concept and ready for mass adoption.

 

  • Indian DPIs – Impact on India in 2022

Matured digital entities (Aadhaar, UPI & FASTag) are estimated to have enabled value creation to the tune of ~0.9% to India’s GDP in 2022. Apart from economic value add, DPIs also contribute to financial benefits, ecological benefits and process efficiencies and convenience for the citizens.

 

  • Indian DPIs – Global Impact Potential

UPI & Aadhaar are being adopted by other countries globally to solve similar social & economic challenges. Presently, over 30 countries are either adopting or in early discussions to implement UPI, Aadhar, and Beckn in their respective countries for boosting social & financial inclusion.

 

  • Indian DPIs – Impact potential by 2030

By 2030, economic value add from DPIs has the potential to increase ~3X- from current 0.9% to 2.9-4.2%, driven by evolution of existing digital entities to deliver superior user experience, utilizing new age tech of AI, Web 3, and others and enhanced impact of budding DPIs such as ABDM and ONDC.

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