India is building a digital nation, and I believe that is what will serve it well in the next decade,” wrote Ajay Krishnan, lead portfolio manager of the Wasatch Emerging Markets Select Fund at 425, in a May 2022 report. Salt Lake City-based investment analyst Wasatch Global Investors has been visiting India for over 20 years and believes that India has undergone significant digitization and is poised for even faster growth.
“Investors underestimate India’s efforts towards digitization,” Krishnan said. Over the past five years, the Indian government has expanded its broadband infrastructure and created a public digital payment system where everyone has a bank account, as well as a secure cloud-based digital vault for storing, sharing and verifying documents. Combining this drive with a digitally savvy young population, India is entering a virtuous cycle that could continue for years.
Wasatch wrote that India is building a 30km-per-day highway and hopes to reach 40km-per-day soon. The state connects 50 million people to electricity every year, which is more than Spain’s population. “The country is on track to build a modern metro system in all major cities. Moreover, India has set a target of building 220 new airports by 2025.”
Krishnan said India has the second highest number of English speakers in the world after the US, an important soft skill, noting that English is the language of global business. IBEF notes that India has the youngest population in the world, with an average age of 29 years; More than 68% of Indians are under 40 years old, 70% of whom are already online. By 2030, India’s middle class is expected to reach 1 billion people, accounting for 70% of India’s population. It is expected to surpass China in population by 2023. More importantly, India will have more than 110 million people of working age, while China will lose several million and increase the number of retirees. Senior. A United Nations model predicts that China’s current population will reach 1.4 billion by 2028. It peaked in 2010 and then declined from 700 million to 900 million by 2100.
In June, Ian Bremmer of Eurasia Group said the Shanghai Academy of Social Sciences published a report, soon to be published, that China’s population actually peaked last year and will continue to decline to 587 million by 2100.
Digitization in India is based on Aadhaar, a biometric identity program that has reached more than 1 billion people (99% of the country’s population as of June 2021 – IBEF), providing each individual with a unique, verifiable identity card that is important to governments, digital markets and interactions with P2P payments and financial services.
“Aadhaar is the cornerstone of India’s major digital, financial, legislative and regulatory advancements,” added Krishnan. India has registered more than one billion people
Aadhaar in about five years, which is about three years faster than the time it took Facebook to reach 1 billion users.” India is looking to export Aadhaar, and reports suggest that as many as 20 countries may be interested. The Unique Authority of India (UIDAI) has partnered with International Banks and the United Nations to deploy ID Aadhaar’s digital architecture overseas.
Digitization efforts in India have started with national government leadership close to home country through digitizing government services, with more than 300 Indian cases so far. The government’s Digital India Program aims to “turn India into a digitally enabling society and knowledge economy”.
He has prioritized the promotion of digital payment services with the slogan “Anonymous, No Paper, No Cash”.
“His vision is to facilitate seamless digital payments for all Indian citizens in a convenient, simple, affordable, fast and secure way through the Unified Payments Interface (UPI)” which is a platform for various digital payment options including Google Pay, Paytm, PhonePe , Airtel Thanks or Bharat Interface for money from Reserve Bank of India (BHIM).
UPI has made India the largest market for real-time payments. As India develops a digital currency backed by the Reserve Bank of India (CBDC), its central bank, Aadhaar can allow banks to provide accounts for everyone. According to the Reserve Bank of India (RBI), India’s official digital currency is under development and will be launched in 2022-2023. CBDC transactions do not require a bank account, which is especially important in developing countries, where a third of the population does not have access to traditional money, but has access to the mobile internet. Using Aadhaar numbers and smartphones, unbanked Indian customers can easily transact via the mobile app. This means that governments in the industrialized world will soon include those previously excluded from the financial system.
Unified Payments Interface (UPI), a free service, is a mobile app that allows people to transfer money to friends and pay bills without the need for a credit card. India can benefit from Direct Benefit Transfer (DBT), which was introduced in 2013 to disburse benefits faster and reduce fraud.
India’s explosive digital growth is largely driven by mobile internet connectivity. its telecommunications network is one of the largest in the world, with more than 1.1 billion mobile subscribers. The number of internet users has grown from 343 million in 2016 to 846 million in 2021, with more than 7 million new users added each month. One of Digital India’s pillars is universal mobile access, which aims to provide coverage to rural India that currently has no cellular service, Wasatch wrote. Reliance Jio offers India’s largest 4G network, which Wasatch says is very low cost, offers significantly higher voice and data capacity and uses less bandwidth than legacy technology. By 2021, there will be about 846 million Internet users in the country, and more than 7 million users are added every month.
Sometimes the adoption of digital processes can lead to the largest bureaucracy in the world, with hierarchies and customs left over from British rule. These millions of bureaucrats are vulnerable to being replaced by technology that, if left unchecked, can streamline government work. Shivam VJ wrote in The Print that “No one, not even a leader as strong as Narendra Modi, will be able to reform India’s bureaucracy; reduce unnecessary steps in their ideal standard operating procedure and make people’s life easier. Bureaucracy. exists to make people’s lives more difficult.” Apparently, because each cog is just trying to stay in its office. No one sees the bigger picture and has less accountability.” K Yatisaj Rajawat, executive director of the Center for Public Policy Innovation, wrote that “Without bureaucratic reform, it is impossible for India to achieve its goals… Power is too concentrated in the bureaucracy, resulting in decision-making delays and project failures. “Training focuses solely on Category A employees, while the rest of the system, which employs more than 20 million people, is not critical enough to receive training.”
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