Digital Dilemma

Gursharan Dhanjal, Editor, INCLUSION

To make the e-governance plan transformative, Digital India has to be demand-driven. This calls for better understanding of the needs of the masses. To make sure people walk the digital highways, the government has to ensure technlogy neutrality, net neutrality and level playing field for different stakeholders including customers and the industry while restructuring the procurement processes, writes Gursharan Dhanjal

It was a prudent move for Prime Minister Narendra Modi to revive the e-governance scheme with renewed vigour. As Gujarat chief minister, he has used IT as a tool to improve governance not just at the top level but also at the grassroots levels. It is the success in Gujarat that emboldened him to implement the e-governance scheme at the national level.

But for Digital India to be successful some very tricky questions need urgent attention. The ones which were never asked before; these are, net neutrality, tech neutrality, General Financial Rules (GFR), procurement and payment processes, level playing field and above all inverted duty structures. Till such time India addresses these issues, the clarion calls like Digital India or Make in India will remain short of delivering their objectives.

The broader objective must be to leapfrog from manual processes to state-of-the-art technology that can deliver the desired goal in the most effective way at the least cost. To embrace the best technologies, India has to first decide whether it wants more control or less control over technology inflow. The sheer size of Digital India’s coverage necessitates opening up of the Indian market for greater inflow of technology and processes.

The government recently announced that it shall endeavour to adopt Open Source Software (OSS) in all e-governance systems implemented by various government organisations in building apps and services, as a preferred option in comparison to Closed Source Software (CSS). This is an attempt to ensure efficiency, transparancy and reliability of such services at affordable costs. Albeit, the policy does not state, prima facie, that the OSS has to be for free. The government would be happy to pay for the commercial OSS, e.g., Rad Hat.

As an exception, the policy states that, in certain specialised domains where OSS solutions meeting essential functional requirements may not be available or in case of urgent / strategic need to deploy CSS-based solutions or lack of expertise (skill- set) in identified technologies, the concerned government organisation may consider exceptions, with sufficient justification. Given that there is aleady an undue delay in release of payments to industry across various e-governance projects for years, for lack of either capacity or due to GFR limitations or missing clauses related to services, who is going to take a call on this “justification”?

It is a tricky decision on uncharted waters that Ravi Shankar Prasad, Union Minister for Communications and Information Technology (MoCIT) has to navigate, if Digital India has to happen. The need of the hour is a judicious policy that protects the interest of all stakeholders—consumers and industry—otherwise innovation will be stifled.

If one talks of transparancy, only one or two companies are selling Commercial OSS (COSS), ipso facto implies that a monopoly or duopoly is being created by law. The National Informatics Centre and Department of Electronics and Information Technology (DeitY) under UPA regime have attempted to do this by stealth without having any stated policy.

The question arises, do the government departments have the capacity to decide between OSS and CSS options with respect to capability, scalability, security, life-time costs and support requirements? This, when the procurement system itself needs to go through an overhaul. Who is going to assess the functional requirements and the matching skill-set required for installations across the country or are we propagating islands of e-governance projects that do not scale? Then what is going to be different now compared to the last ten years of National e-Governance Plan (NeGP)?

Extreme caution needs to be exercised that India does not leap backward to pre-1991 days when markets did not dictate anything. Instead, it was license-permit sarkar would determine business success. It’s time to allow a million flowers bloom with a level-playing field leaving technology choices to the market forces.

Net neutrality flows from tech neutrality. If the government is envisaging leveraging telecom infrastructure to enable web economy thereby ensuring equitable and inclusive development across the nation by enhancing affordabiliy, increased access and delivery of multiple services at reduced cost, then how is this going to be different in terms of tech neutrality? The government’s stand needs to be consistent when it comes to tech neutrality as well.

These issues are far more complex that require expert intervention, guidance and advice. By merely putting out a half-baked consultation paper and then have a mob of 1 million people respond to it, can run the risk of policy anarchy. What instead is needed is a fine balance between populism and policy rationale.

Providing disruptive technology solutions is key to the success of Digital India programme that aims to transform India into a connected knowledge economy. Most of these technologies and investments have to come from the private sector. However, so far the initiative has got cold feet and cold shoulder from the private players.

Tech Neutrality

“We should not make technology choices nor specify technology, rather specify services. It does not matter which technology powers up the services,” says Ram Sewak Sharma, Secretary, Department of Electronics and Information Technology (DeitY). He said this while stressing that the ambitious Rs 113,000 crore ($1,130 billion) Digital India plan will require a lot to be done and undone when it comes to making technology choices, its procurement and implementation across the government system. This emanates from an increasing realisation in the government that the time has come to focus on delivery of services and leave the choices of technology to the market forces.

“At the same time we should not make silo solutions. These have to be interoperable based on open architecture and open standards. Even though it is proprietary, it should be in a position to work on open standards so that all the stakeholders could communicate with each other,” added Sharma. Since technology projects are linked to services, it should be free from interpretations. This necessitates creation of templates for all the departments and stakeholders to cut confusion, delays and added costs.

Given the country’s experience in technology so far, it is difficult to deny its potential but somehow the country has not been able to leverage it fully. In big government projects like Income Tax, Passports and Railways, the benefits are visible. Outside government, like banks and healthcare, a lot has been done, but these are all isolated examples. Technology, today is capable of reaching the masses but there is little understanding within the government on what technology does, what kind of technologies are available and how low the cost of leveraging this technology has become, pointed out R Chandrashekhar, President, NASSCOM and former Secretary to the Government of India.

Total Cost of Ownership

Digital India is not about technology, it is about service delivery. It has been observed that the government even lacks the capacity to take technology decisions which are driven by ‘opinion’ rather than consultation. This is primarily because the technology frameworks are missing. The government should set priorities, frameworks of what is to be achieved, rest should be left to the people. The neutrality tone has to be set right at the top—whether open source, mixed source or proprietary—elbow room has to be provided to take decisions that are not counterproductive to the government plans. In fact, the open source or proprietary battle has ceased to exist, but the mindset has not changed, people still find them in time freeze. It is in fact a Total Cost of Ownership (TCO) battle. The appreciation of the fact that Digital India is different than digital government is yet to be fully understood. “This will be a collaborative game—there are many things that have to be done together with adoption of technology and from outside by providing solutions that have low cost of ownership over a period of time,” commented Chandrashekhar. So far, the government has been procuring technology and products. “We will have to shift from the concept of L1 to best value for money—the scope of which goes beyond technology. It has to be TCO and the value that it brings to the citizen; and, to the government,” said N S Kalsi, Government of Punjab.

Furthermore, as India is opening up to e-commerce with markets growing by leaps and bounds; it is estimated to hit $100 billion mark over the next five years from $20 billion today, the technology cannot remain captive. “We have to look at scalable solutions that meet global standards with low cost of ownership to be able to compete with the best in the world,” said J K Dadoo, Joint Secretary in the Ministry of Commerce.

Interestingly, technology gets adopted not by its features or speed but because of large enabling ecosystem of people who can implement this technology and use it accordingly. What has been seen is that projects are implemented in a containerised environment and when these are replicated across 29 States and 7 Union Territories, it would require thousands of people with a requisite skill set, which otherwise is liable to become a bottleneck. Every state is doing things differently, but when one interacts with the citizen, the interface of citizen with the government is same all over. This perhaps, is one reason that has kept various projects from scaling except the MCA21, Passports and Railways, which did create an ecosystem to take these national. “We have global experience that can be leveraged. Why can’t we replicate the best practices within our states and union territories to gain momentum,” asks Neelam Dhawan, MD, HP India. “Let the market forces decide the channel that they choose to interact with the government,” added Som Satsangi, Vice President, HP India. “If we have to notch up from rank 142 the World Bank’s ranking in Ease of Doing Business to within top 50, as desired by the Prime Minister, we need to see what other countries are doing to remain at the top. When we implemented MCA21 ten years ago, India was at 145 spot,” said a worried Tanmoy Chakrabarty, VP & Head, Government Industry Solutions Unit, TCS.

Hurdles in Procurement

Surely, there are gaps. The biggest issue is that people responsible for different domains are not fully aware of what technology does, what technologies are available or can be deployed or what services to expect. The General Financial Rules (GFR) of the Government of India are perhaps to be blamed for this siloed thinking, which does not allow any innovation. On the one hand technology is fast moving forward and innovation is happening but on the other conservatism is setting in. Procurement process of the government is not aligned in terms of the needs of IT, which has rendered it rigid and inflexible. Government’s challenge today is procurement. Yet, it is happening, somebody is signing the papers. But at the risk of his career, job, reputation and peace because, each time, procurement of IT and services is done or completion certificate issued, GFR is violated. “We have already moved a proposal to the Ministry of Finance (MoF) asking for revision in GFR for procuring IT and services. This is required considering peculiar nature of IT products
and services,” said Ajay Kumar, Joint Secretary, DeitY and Director General, National Informatics Centre (NIC).

Apparently there has been a circular from the CVC that has made life even more difficult for the government. Consider a situation where a bank decides to open 100 more branches. It is logical and prudent that the existing infrastructure is scaled – using the current arrangements both in terms of hardware and software to keep the TCO under control. The circular suggests that if you were buying proprietary, certain clearances would be required from a particular department. “Industry could explore possibilities to address this and other problems by engaging and sensitising the institutions such as CVC, MoF and so on,” suggests Gulshan Rai, Director General, iCERT. Irony is that people who are doing it are different from the ones who are sanctioning the amount. “There is IFD everywhere and it would not go with the spirit of the RFP document, they will go by each and every full stop and comma. This is where the problem lies,” added Kalsi. This is causing frustration not only in the industry but also within the government simply because there is no way moving forward. Even RFPs get redesigned for the same reason. For industry, each time it is a new effort. There should be an outcome-based decision-making at the time of designing a project rather than looking at a CPU or hard drive.

This is also one big reason, why the completed projects do not get completion certificate and therefore, not paid on time. MCA21, for one, got it only after five years. “It was brave on the part of the Secretary to have taken a call on this,” said Sanjiv Mital, CEO, National Institute of Smart Government (NISG). By any rough estimates, the government today owes the IT industry upwards of Rs 5,000 crore which explains the reason why, in response to six tenders recently, only one bid was submitted. This certainly is neither a technology nor talent issue. “Many company’s CFOs have stopped their government verticals to participate in government projects,” says Prakash Kumar, CEO of Goods and Services Tax Network (GSTN), a public-private-partnership company set up primarily to provide IT infrastructure and services for implementation of the Goods and Services Tax (GST). In the last two years, large system integrators have stopped responding to e-governance projects. Kalsi made a suggestion here to resolve the payments issue. He said, lets change the framework. For doing business in the industry there are ways to open an LC, why can’t same system be arranged in the government? Instead of opening an LC with the bank, let that money be put with a third party roughly called the independent regulator or a review agency. Then RFP could define milestones on how money is to be disbursed under SLAs. If third party had disbursed the money, a situation like MCA21 would not have arisen, he added.

The Swiss Challenge

IT procurement needs transformation. It can’t be procured in the same way as traditional goods and services are procured. The focus has to shift from buying and procuring of technology to availing the services. There is another solution to this—the Swiss Challenge. “This is a method of public procurement that requires a government agency that has got an unsolicited bid for a public project or services to be provided to the government, to publish the bid and invite third party to either match or exceed it,” cites Kalsi. Madhya Pradesh is, in fact, one such state that has effectively used the Swiss Challenge. It has constituted a committee headed by Chief Secretary to examine the idea and is discussed with five or six other Secretaries to get their suggestions on what works, with modifications. “The proponent of the idea is asked to invest his money to prepare a DPR, which is reimbursed to him later on if he gets the project. In order to protect his intellectual property, the state does not publish the DPR on Internet but says this is what government wants and that the project proponent is willing to do this for this amount of money, if you can do it for less, let us know,” explains Anthony de Sa, Chief Secretary, Madhya Pradesh. “We do not change the idea because then the terms of tender and RFP would change. Even if somebody else says, yes, we can do it for less, the project proponent of the idea is given a chance to match because it was originally his idea and prepared the DPR. If he says no, then it is given to the challenger. The DPR is not repeated and he pays the money to the original proponent of the DPR,” elucidates de Sa.

This can be institutionalised across government and can be a huge step in adoption of technology. “Government is aware of the outcomes. Challenges are at three levels: tiresome process; problems in payment; and, system is rigid providing no room for innovation. The Swiss Challenge is one path more amenable to that,” emphasised Chandrashekhar. Highlighting the importance of outcomes, Chakrabarty added that while we respect the jurisdictional boundaries of the government, technology can be used as an underlying layer that can be leveraged to fast track outcomes. Citizen does not care which Ministry I am, to the government he is one customer. But there can always be a common IT infrastructure and application functionality that can deliver, he said.

Transactional Biometrics

Registering to the biometrics identification system of an online portal is a common scenario being adopted by more and more online shoppers. Biometric samples of a user are stored in these systems using different physical traits and used for matching every time the user wishes to make a purchase. Biometrics in financial services is common now while opening Jan Dhan accounts. Hence, digital signatures, facilitated by biometric procedures are most eligible ways to maintain the integrity of these documents, whether banking or insurance.

With increased use of online and digital mode, it is becoming increasingly difficult to keep tracking one more user ID and one more password that keep on multiplying. For ease, one ends up having the same password for everything. Is there a better way of authenticating a person? “Why not use biometrics for this, why not have a small fingerprint reader attached to a PC or any other device and eventually each and every other side can ask for biometrics as an enhanced level of security,” asks Mital. Technology-wise it is not an issue, fingerprint can be encrypted, far more secure than anything, ubiquitous—not just for Aadhaar but for all other transactions.

Needless to say that biometric technologies offer higher security levels by simply ensuring that the authorised individual is physically present to gain access. Best, biometrics remains unique and cannot be duplicated. It also rids the identity cards, password protection, PINs, and so on, which can be forgotten, stolen, lost or changed. As per Frost & Sullivan, globally signatures contribute less than 1 per cent to revenues compared to biometrics, estimated at upwards of 70 per cent.

Level Playing Field

India’s 95 per cent economy runs on cash—more so the rural economy. This is primarily because, the country lags behind in devising systems to electronify such transactions. The challenge is in transaction cost. Banks need to learn from the telecom sector, which makes money even on a Rs 10 recharge. The importance of locally relevant technology options with level playing field cannot be ruled out. Whether it is MasterCard or any other card, let the competition happen and customer decide the usage of services. “If we want to ensure inclusion of all sections of society, we need to cut the total cost of ownership and allow interoperable technologies that are easy to use and understand,” opined Sharma while talking about the banking sector. Ari Sarker, Division Head – South Asia, MasterCard Worldwide, agreed that creating a cashless society is a huge challenge. He said, while private sector welcomes competition, competitive markets define an open economy. He is worried about a lurking monopoly in the financial inclusion drive as the National Payments Corporation of India (NPCI), the sole payment gateway, restricting competition with RuPay cards bundled with Pradhan Mantri Jan Dhan Yojana (PMJDY) accounts. The National Financial Mapper (NFM) managed by NPCI links all transactions on debit cards, the charges for which are recovered by NPCI, irrespective of the clearing mechanism.

The government or regulator should not distort the levelplaying field by directly or indirectly indicating technology or vendor preferences. A case in point would be the informal understanding of ‘NPCI preferred’ or a government policy that may state ‘open source preferred’. Tech neutrality means equal opportunity, fair and open market to all.

Improvising Purchases

The government, on its part, has also been working to correct some of these anomalies. Sometime back we started working on creating RFP templates after consulting all the stakeholders including government departments, industry, consultants, etc. These will serve the need for departments to procure IT and services, informed Rajendra Kumar, Joint Secretary, in-charge of e-Governance at DeitY. He also talked about the problems the government faces vis-a-vis the industry.

He said, in most cases the industry partners themselves do not advise the concerned departments correctly on using these templates. For us the approach going forward is to leverage technology and to address issues of procurement and reducing the cycle time and burden of what departments have been doing so far when they want to develop an application or procure IT equipment or software.

Cloud-based services can reduce the cycle time and expenditure significantly by government departments going live. The government departments spend a lot of time in setting up data centres and procuring hardware. “In doing this, the purpose of e-governance services get lost. Next is the issue of replication. The issue of ownership comes up for using one application of one department by another department. We want to encourage replication. However, when industry partners are asked to do the replication, the cost quoted is often quite high,” points out Kumar. He added that when departments want to exchange data with other departments, prices are quoted by the industry where the data belongs to the government. “The process of revising templates that we have started should help the departments and the industry to a great extent in making the process of ICT procurement simpler,” summed up Kumar.

(Gursharan Dhanjal can be reached at

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