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India’s Digital Public Infrastructure

Context: The United Nations (UN) is actively involved in the initiative of “Digital Public Infrastructure” or DPI to leverage the power of digital technology to advance the Sustainable Development Goals (SDGs).

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As per the United Nations, Digital Public Infrastructure (DPI) has played an important role in addressing various global challenges, particularly those related to climate change and sustainable development.

Leveraging DPI to achieve green transitions and address complex planetary crises:

  1. Transparent Carbon Markets:
  • The Challenge: Meeting climate commitments requires significant funding, but the complex verification process for carbon credits poses obstacles, especially for smaller projects in the global south.
  • DPI Response:
    • Implement open-source, standardized components for carbon trading, digitize methodologies, establish consistent carbon registries, and introduce a Climate Action Data Trust layer.
    • These measures can make carbon markets more efficient, transparent, and cost-effective, unlocking funding for climate projects.
  1. Efficient and Inclusive Circular Economies:
  • The Challenge: A small portion of the global economy operates in a circular manner, and consumption patterns generate substantial waste.
  • DPI Response:
    • Merge the principles of circular economies with open commerce networks, using DPI to optimize waste management in areas like plastics, urban waste, and textiles.
    • This approach can create economic value, reduce waste, and provide opportunities for informal workers to participate.
  1. Smart Energy Networks:
  • The Challenge: Many lack access to energy, and transitioning to sustainable energy sources is essential for achieving climate goals.
  • DPI Response:
    • Implement a Unified Energy Interface (UEI) using open-source protocols to manage stored energy resources.
    • UEI supports local energy grids, real-time energy balancing, and diverse energy solutions.
  1. Climate-Resilient Urbanization:
  • The Challenge: Growing urban populations contribute significantly to greenhouse gas emissions, and many cities are not adequately prepared for climate-induced challenges.
  • DPI Response: Implement planning codes that prioritize green infrastructure and transit, manage waste efficiently using DPI, and equip cities with response plans for climate-induced disasters.
  1. Green Finance for Local Climate Action:
  • The Challenge: Indigenous groups and farmers who protect ecosystems often lack access to climate financing.
  • DPI Response:
    • Address challenges in climate financing, such as swift transactions, transparency, and complex transfers, by digitalizing result-based green financing.
    • Utilize Government to People (G2P) payments through a DPI to efficiently funnel climate finance to those in need.

Digital Public Infrastructure and SDGs:

  • Improved Access to Information: DPI provides digital access to important information and resources, helping people stay informed about health, education, and other vital services. This can empower individuals and communities to make better decisions for their well-being, which aligns with SDG 4 (Quality Education) and SDG 3 (Good Health and Well-being).
  • Financial Inclusion: DPI can facilitate digital payment systems, making it easier for people to access and use financial services. This supports SDG 1 (No Poverty) by providing financial tools to underserved populations.
  • Economic Growth: By enabling digital entrepreneurship and access to online markets, DPI can stimulate economic growth and job creation, contributing to SDG 8 (Decent Work and Economic Growth).
  • Environmental Sustainability: DPI can help monitor and manage environmental data and resources, contributing to SDG 13 (Climate Action) and other environmental goals by aiding in the sustainable management of natural resources.
  • Reduced Inequalities: DPI can help bridge the digital divide by providing access to digital services and information to marginalized and underserved populations, aligning with SDG 10 (Reduced Inequality).
  • Innovation and Industry Growth: DPI can foster innovation and the growth of the digital industry, which can support SDG 9 (Industry, Innovation, and Infrastructure).
  • Efficient Service Delivery: Digital systems supported by DPI can enhance the efficiency of public services such as healthcare and education, contributing to SDG 16 (Peace, Justice, and Strong Institutions).
  • Data-Driven Decision-Making: DPI can provide valuable data for policymakers and organizations to make informed decisions and prioritize efforts to achieve the SDGs, supporting multiple goals, including SDG 17 (Partnerships for the Goals).

Understanding Digital Public Infrastructure (DPI):

What is DPI?

  • It refers to an open-source identity platform that can be used to access a wide variety of government and private services by building applications and products.
  • It includes digital forms of ID and verification, civil registration, payment (digital transactions and money transfers), data exchange, and information systems.
  • These public digital platforms are customizable, localizable, interoperable and leverage public data for open innovation models.
    • For example, Unified Payment Interface (UPI) architecture’s interoperability is resonated in over 300 banks offering linkages to bank accounts through UPI which is accessed by consumers via 50-plus third-party apps.
  • Principle: The platforms in DPI are based on core principles of consent-based data sharing protocols, openness, equity, inclusivity, fairness, transparency and trust, hence reducing the digital divide.
  • Significance:
    • Because of DPI’s low-cost and inclusive platforms, India has been able to push the boundary of public service delivery and digitally leapfrog, with the public sector defining regulatory limits and the private sector innovating and competing in the marketplace.
    • DPI also allows nations to retain strategic control over their digitalization processes, ensure digital cooperation and strengthen long-term capacity.
    • A recent study by the Bank for International Settlements (BIS) has highlighted that on account of the DPI, India has delivered in 10 years what would have taken 50 years to achieve.
    • The analysis by the Centre for Digital Economy Policy Research (C-DEP) estimates that national digital ecosystems could add over 5% to India’s GDP.
  • Applications: India is seen as a global trendsetter in the DPI movement, having set up following multiple large-scale DPIs in contrast to the tech innovations that earlier emerged from the developed world:
    • JAM trinity which links Aadhaar, mobiles and bank accounts
    • Digi Locker for digital storage and documents
    • Bharat Bill Pay, a one stop solution for multiple payments.
    • UPI, Aadhaar Enabled Payment Systems (AePs) and Immediate Payment Service (IMPS)
    • CoWin for vaccination.

Digital public infrastructure and platforms (DPIPs):

The five predominant DPIPs that are currently in operation in India, namely, Aadhaar, Unified Payment Interface (UPI), Ayushman Bharat Digital Mission (ABDM), Digital Infrastructure for Governance, Impact & Transformation (DIGIT), and the Account Aggregator (AA) Framework.

DPIPs Performance
  • Provided a massive boost to financial inclusion in India.
  • The country has reached significantly high levels of bank account ownership, closing the gap between the rich and the poor and between men and women.
  • The scheme has led to an overall savings of INR 2 trillion.
  • Aadhaar through e-KYC has also brought down costs of verification, leading to savings in costs for customer acquisition from INR 500 – 700 per person to INR 3.
The Unified Payments Interface (UPI)
  • Real-time interoperable payments system, which has seen unprecedented growth, especially for peer-to-peer (P2P) transactions.
  • UPI has introduced features such as UPI123 and UPILite to make the ecosystem more inclusive.
Ayushman Bharat Digital Mission (ABDM)
  • While Co-Win platform saw phenomenal success, the registration of health IDs and linking of electronic health records has been relatively slow and regionally dispersed.
  • The system currently is completely driven by public sector institutions unlike most other DPIs in India.
  • E-Sanjeevani, the government’s telehealth platform, is a rising star and stands out in terms of the share of female users, compared to many other private sector platforms.
Urban Platform for deliverY of Online Governance (UPYOG)
  • It is a platform designed to enhance the operational capacity of rural and urban local bodies, municipalities, and cantonments in India.
  • It is built using the Digital Infrastructure for Governance, Impact & Transformation (DIGIT) core.
  • UPYOG aims to integrate these different bodies into a central system to enable efficient online governance and service delivery.
  • The platform could potentially streamline administrative tasks, provide greater access to government services and information, and enhance the overall effectiveness of local government bodies in India.
  • Improvements in development outcomes are slowly becoming visible.
Account Aggregator Framework (AAs)
  • Built on the Data Empowerment and Protection Architecture (DEPA) is a new class of intermediaries that facilitate data sharing based on valid consent from individual users.
  • From the latest data available, 4.02 million bank accounts have been linked to AAs and the cumulative count of consent requests successfully fulfilled is 3.9 million.
  • According to industry estimates, 50 per cent of the lending disbursed through AAs were to MSMEs and that the cost of loan processing has declined by 75 per cent from INR 440 to below INR 100.

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