Topic - Technology: Solutions made in India

Date - 20th Nov 2020

Topics covered from the syllabus:

• Essay,
• GS-3:
  • Science and Technology- developments and their applications and effects in everyday life.
  • Achievements of Indians in science & technology; indigenization of technology and developing new technology.

 

Note:

• Following is the summary of ‘The Big Picture’ discussion, which was aired on RSTV.
• Host: Frank Rausan Pereira.
• Panellists: Abhishek Singh, Ministry of Electronics and Information Technology; Sanjay Nayak, FICCI; Praval Singh, Zohocorp

 

Context:

• Addressing the Bengaluru Tech Summit virtually, PM Modi said that it is time for ‘technology solutions - designed in India, deployed for the world’.
• He also said that India is in a sweet spot and it is time for the country to take advantage of its unique position and leapfrog in the technology sector
• He stated that the intent of the government is to align its policy decisions in favour of the technology sector, including easing the compliance burden on technology-related start-ups, through a dialogue with the relevant stakeholders.

 

State of Technology and Design sector in India:

• Impact of Covid-19: Covid-19 has accelerated the adoption of technology in India, for e.g. telemedicine and online education
• Changing perception of India: Earlier India was considered as a service-oriented nation which was known for receiving the outsourced work from the western countries. However, now India has started emerging as a product-developing nation, which can even outsource work to other countries.
• Infrastructure: Infrastructure for development of the technology sector has improved. For e.g.
  • JAM trinity
  • Better internet coverage with enhanced 4G network and expanding Bharatnet
  • Ease of payment with BHIM, Unified Payments Interface (UPI) etc.

 

JAM Trinity – JAM trinity was suggested by the then Chief Economic Adviser Arvind Subramanian in Economic Survey 2014-15. It refers to a combination of below three entities for more efficient delivery of government services: Jan Dhan Accounts - Financial inclusion in the form of PM-Jan Dhan Accounts, Aadhar Mobile - seeding of the account with Mobile numbers to ease the identification

 

Bharatnet – Bharatnet is set up under the Department of Telecommunication for providing broadband connectivity to gram panchayats. It seeks to fulfil the mandate of National Optical Fibre Network Bharatnet seeks to enhance the digitisation in rural India under the Digital India Mission

 

 

Impact of Covid-19:

• Work from Home: It has promoted the use of tools and technology which were earlier considered too advanced or inaccessible for most employees. E.g. Zoom virtual meetings. Recently, media reports have indicated that sale of the equipment which facilitates work from home has been on the rise. For e.g. tabs, laptops etc.
• Initial pessimism: The first instinct of the industry was to scale back in the face of lockdown and widespread closure. However, later, as demand for online services and tools and technology has risen, businesses are looking at new avenues of growth and a realignment of the industry can be observed.
• Productivity enhancement: In the Post-Covid scenario, since most of the workforce is working from home and is available round the clock, productivity has seen an increase.
• Online Availability of services: Leapfrogging to a digital-led era where businesses are shifting their essential services towards automation and online availability. For e.g. use of chatbots instead of Business Process Outsourcing (BPOs).
• Decreasing costs: Most industries have reported a decrease in various costs like real estate costs, rental premises or electricity bills, as a result of employees working from home.

 

Strengths of India:

• Government Policy: Recent policy-related interventions by the government for facilitating business during Covid related restrictions. For e.g. Make in India, relaxation of work from home norms, labour code norms.
• Demographic Dividend: Currently, India is in a sweet demographic spot, where a major part of its population is in the workforce. the average age of India is approximately 29 years, which means that we have more working people than their dependents.
• Huge domestic market: Indian industry is not dependent upon foreign markets for the sale of products. Instead, we have a huge urban as well as rural market which facilitates and encourages businesses to invest in expansion and quality, to enhance their foothold in more markets.
• Back-office of the world: Just as China is recognised as the workshop of the world because of its manufacturing prowess, India is also recognised as back-office of the world. This is due to its recognition as a top-notch software development provider.
• Fast expanding infrastructure: Indian government, aided by public-private partnerships has been working in the direction of providing the necessary infrastructure to improve digital connectivity in India. For e.g.
  • Internet: Widespread 4G infrastructure and ongoing trials in the field of 5G connectivity.
  • Electricity: Provision of reliable, last-mile electricity connections is a work in progress. Government of India launched the Saubhagya scheme (Sahaj Bijli Har Ghar Yojana) to provide electricity connections to the left-out households, who were willing to apply for electricity connection.
  • Sale of equipment: With fast expanding reach of e-commerce website and decreasing delivery time, accessibility to equipment like mobile phones, laptops, internet routers has increased.
• Strong Education ecosystem: Education infrastructure in the country is considered world-class due to presence of institutions like the IITs, NITs and IIMs. They provide a ready supply of human resources for the expansion of industry. However, there is a scope of improvement as Indian educational institutions fare poorly in the world education rankings. Similarly, there is a need to improve the curriculum and align it to the current reality, to enhance the employability of new students.

 

Key Challenges:

• Skilling of workforce: As already stated earlier, India is currently reaping the benefits of demographic dividend. However, the industry has repeatedly complained about the lack of employability of Indian graduates. This is because of the mismatch between skills required by the industry and the skills acquired by the students. Therefore, frequent revision of the curriculum is critical to maximise the benefits of demographic dividend.
• Brain drain: There has been a tendency among top scholars to migrate to western countries in search of better prospects and standard of life. This leads to the industry following such scholars and shifting out of India. Although, the nation has benefited from such diaspora in both financial as well as the preservation of India’s strategic interests, yet there is a need to provide similar facilities at home to stop such emigration.
• Solving real issues: There is a need for scaling up the technology to solve societal issues, like gender imbalance, lack of skill etc, to utilise it for the benefit of people.
• Lack of adequate incentives to start-ups: Presence of bureaucratic red tape and reports of over-regulation has impeded the growth of start-ups. Therefore, provision of adequate incentives to the start-ups for designing new products is important.
• Lack of investment in lesser-known start-ups: While more famous start-ups have seen multiple rounds of investment, other lesser-known start-ups have shrivelled due to lack of investment and capital.
• Bias towards foreign products: There is an inherent bias in the consumer mindset in India in favour of services and products offered by foreign technology giants like Google and Microsoft. This translates to lesser acceptance and lesser opportunities for the Indian start-ups.
• Price-conscious consumer: India is a highly price-sensitive market, which sometimes doesn’t allow investment in quality, due to focus on cost-cutting.

 

Way Forward:

• Role of the Government: Government must take lead to take up the offset clauses more aggressively, to demonstrate the domestic capability to both domestic as well as private businesses.
• Focus on brand recognition and acceptance: It is important to create brand loyalty by investing in marketing and development of a robust advertising industry.
• Focus on consumer mindset: As we have stated that India is a price-sensitive market, achieving economies of scale would lead to a decrease in the per-unit cost and better alignment with the consumer expectations.
• Intellectual Property: Focus on conceptualisation and application of ideas, which showcases an abundance of talent in the country to the outside world and brings in foreign investment. For e.g., apple focusses on R&D, rather than manufacturing.
• Leverage the trust: India is perceived favourably by the Least developed countries, with whom India has been generous in providing technology transfer and technical know-how. It can leverage the goodwill created in such markets to promote itself as Information and Communications Technology tools supplier.
• Incremental Manufacturing – There is a need to take small steps, to meet a larger objective. For e.g. if we do not have the technical know-how to make mobile phones in the country, we can start by making mobile chargers. This will further create fertile ground for mobile manufacturing ecosystem in India.
• Investment in R&D and creation of an innovation ecosystem to leverage the education ecosystem.
• Ensure adequate availability of capital: Multiple agencies should be engaged to ensure the provision of capital like the banks and corporates (in the form of angel investors and venture capitalists – see inset)

 

 

Angel Investor	Venture Capitalist
This is usually an individual, who invests seed capital in the company.     Mostly, provides guidance and not involved directly with the management of company.   This is usually not a business investor, but an individual looking to give a helping hand to a promising but cash-strapped start-up.	This is usually a company or a business entity, who invest in search of handsome returns   Might enforce terms and conditions, and targets for the company, in return for the investment.   This is usually a business investor, who has seen the proof of concept and invests for better returns.