The defining characteristic of a string of initiatives announced by the government, including Digital India (DI), as noted in a Business Standard editorial, is overweening ambition. DI’s goals are noble. But can they be realised in the announced timeframe?
DI is not all new. It is an amalgam of three ongoing programmes: the National Optical Fibre Network (NOFN), the National Knowledge Network and the e-governance initiative. What’s different is the ambition and how quickly it is slated to get done (by 2019). DI seeks to provide broadband access to all and deliver all manner of services to the citizen’s doorstep.
Broadband refers to the high speeds at which users can access the internet. At present, India’s modest definition of broadband is any speed over 512 kbps. In contrast, broadband speeds in other countries currently range from 10 to 50 mbps. broadband delivery requires a national network (pipe) capable of carrying large quantities of bits at very fast speeds; hence the NOFN. However, broadband needs more than just the pipe. An illustrative list of infrastructure requirements includes adequate access spectrum (the basic ingredient of mobile communication) and backhaul spectrum (to haul communication from the fringe of the network to the main pipe), towers and network connectivity. These individual components have to be in sync. The element with the least capacity determines the overall capacity of the system to deliver broadband. Laying the network involves right of way (RoW) issues. The charges levied by municipal bodies for RoW are huge and clearances are cumbersome. In many cities, RoW charges are five to 20 times (if not more) of the cost of the fibre being laid.
A good starting point to gauge DI’s ambition is to assess where we are. India ranks 125th in the world for wired broadband penetration, with 1.2 per 100 inhabitants having access; the global average is 9.4. In wireless broadband, India is ranked 113th, with a penetration of 3.2 per 100 inhabitants. India is among the 42 classified as least-connected countries.
What is the current state of play of DI? The NOFN is well behind schedule. Three years after commencement, less than 3 per cent of the target had been achieved. Targets were scaled down so that 50,000 gram panchayats would be connected by March 31 this year. This has not been done. The availability of spectrum is a major constraint. On average, access spectrum in India is 40 per cent of that available elsewhere. On backhaul spectrum, the amount actually allotted is not even 40 per cent of the supply already available. Towers have become a big hurdle in most urban settings. Much of this is to do with ill-informed opinion about potential health hazards. Last, in places where optical fibre was laid some time ago, it has become unusable. Building the NOFN without addressing this problem will leave us exactly where we are.
BSNL’s optical fibre cable network currently extends to 96 per cent of all districts and 80 per cent of blocks. However, this has not translated into the delivery of broadband. Supply does not create its own demand. The demand for broadband is determined by the affordability of devices, the cost of internet access, and, most important, the availability of useful programmes/ applications that cater to local needs in local languages. Without software, even affordability pales into insignificance.
Over the past three-five years, the focus has been on the NOFN. But where are we on software? But for sporadic efforts by a few state governments and the private sector, nothing really meaningful on e-governance has been delivered over the past decade. The repeated chanting of the mantra of e-health and e-education has not delivered any usable programmes. The development of these applications cannot be left to the government’s IT boffins.
There are two other constraints: the availability of financial resources and the appropriateness of institutional structures. Consider the following: The USOF (the institution to finance DI) has no independence. The usual bureaucratic process of decision-making prevails. Further, though contributions to the USOF are non-lapsable, getting resources released from the finance ministry is another matter. Over the past few years, some Rs 3,000 crore has been released on an annual basis. In fact, most of the accumulated USOF money has been used to fill the budgetary hole. DI entails resources of Rs 1,20,000 crore (or more) over four years. This is roughly 10 per cent of all government resources in a year. Now, consider the institutional arrangements for executing the NOFN. It is a three-layer system: the USOF gives money to BBNL; this PSU in turn passes on resources to BSNL, RAILTEL and Power Grid, the actual executing agencies. Such an institutional structure is doomed to failure.
Clearly, we have a long way to go. On any reasonable estimation, DI, as envisaged, looks like MI (mission impossible). Nevertheless, it is possible to make a good start. But even a scaled-down programme will require a herculean effort in four areas: infrastructure, resources, institutional restructuring and policy. First, far greater amounts of spectrum have to be made available for commercial use with clearly stipulated timelines. If this is not planned, announced and implemented, access spectrum will become a binding constraint. Second, a nationwide decision on RoW is imperative if we are serious about delivering broadband. Third, the USOF has to have much greater independence to hasten decision-making. Fourth, the resource constraint can become critical. On current estimates, the resources required annually (Rs 30,000 crore) are 10 times the Rs 3,000 crore per annum released. Fifth, the institutional arrangements to implement the NOFN need immediate revamping. The same goes for the USOF, and the Wireless Planning and Coordination wing of the ministry of communications, responsible for spectrum management. Once it is decided to make spectrum available on a commercial basis, why do the allocations take so much time? Why should clearances be shrouded in secrecy? Last, on other policy issues: Why not use the private sector to expand the network? Why should we not consider the Nordic solution of lower spectrum prices and lower annual fees subject to expanding coverage?
As conceived and publicly announced, DI is simply not doable by 2019. A more realistic goal would be to connect some (not all) areas and deliver high-speed broadband; and provide some essential and locally valued services in as many rural areas as possible. We can certainly start showing results by 2019 with a lower scale of ambition.
The writer is former chairman, Trai