Common Service Center Scheme - A Primary Priority for Government

As one of the most important constituents of the National e-Governance Plan (NeGP), the Common Service Centers (CSC) scheme was established with the vision to serve as the ICT-enabled rural service delivery points for offering government to citizen (G2C) and business to consumer (B2C) services.

Approved in September 2006 with an outlay of `5,742 crore over a period of four years, it was proposed that under the CSC scheme 100,000 Internet-enabled centers were to be built in a PPP model, envisaging a three-tier structure including the CSC operator (called Village Level Entrepreneur or VLE); the Service Center Agency (SCA), that will be responsible for a division of 500-1,000 CSCs; and a State Designated Agency (SDA) identified by the state government responsible for managing the implementation over the entire State.

These CSCs are proposed to be the delivery points for government, private and social sector services to rural citizens of India right at the doorstep. The CSC scheme is envisaged to be a bottom-up model for delivery of content, services, information and knowledge, that can allow like-minded public and private enterprisesthrough a collaborative frameworkto integrate their goals of profit as well as social objectives, into a sustainable business model for achieving rapid socio-economic change in rural India.

Making the Wrong Noises

Introduced with much fanfare by Dr Manmohan Singh-led UPA government 4 years back, the CSC scheme was a part of the UPA governments commitment in the National Common Minimum Program to introduce e-governance on a massive scale.

However, over the last 2 years the scheme has been in the news for all the wrong reasons. First the scheme has been running behind schedule (the overall rollout was expected to be completed by June 2010) and then the pullout from major players like 3i Infotech and Comat Technologies hasnt exactly been good news.

As on October 31, 2010, a total of 85,506 CSCs have been rolled out in 30 states/UTs. Whats significant is that more than 70% rollout has been completed in 21 states including Assam, Bihar, Chandigarh, Chhattisgarh, Delhi, Goa, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Kerala, Madhya Pradesh, Manipur, Meghalaya, Mizoram, Orissa, Puducherry, Sikkim, Tamil Nadu, Tripura and West Bengal and in another 2 states (Maharashtra and Uttarakhand) the implementation has crossed the half-way mark. It is expected that the rollout of 100,000 would be largely completed by March 2011.

Whats significant here is that out of the total rollout of 85,000 plus CSCs, around 4,600 are currently non-operational wherein either the SCAs have withdrawn or there has been no interest from private players. While the CSC scheme did see an unprecedented interest from the private sector in the initial phase, the interest seems to have fizzled out as 2 major players, the ICICI bank backed 3i Infotech (which was allocated the second highest number of CSCs after Srei Group) withdrew its bid to set up 11,500 CSCs. The move dealt a severe blow to the governments plan to set up 1 lakh e-enabled kiosks in rural India as part of the `23,000 NeGP plan.

Adding fuel to the fire was the withdrawal of Comat Technologies, which was expected to set up around 6,000 CSCs.

The CSC scheme has been already facing flak from several quarters for the delay in completion; the pullout has meant that the deadline for the overall layout has been further pushed to March 2011.

However the pullouts from 2 major SCAs alone is not responsible for the delayaccording to a DIT official, around 10,000 CSCs are located in difficult terrain (read hilly areas and naxalite affected regions) wherein the SCAs are finding it difficult to set up shop. Moreover after 3i Infotech and Comat withdrew, the state governments have been delaying the conclusion of the tender process and in appointing new SCAs.

The scheme envisaged a substantial investment from the private sector, currently there are more than a dozen players involved. However one of the biggest reasons for the failure of some centers was that a few companies were far too aggressive in bidding, some even quoting negatively just for bagging the tender. A few SCAs also perhaps did not understand the business plan and overestimated the expected revenue estimates. Moreover, the arrival of the global economic crisis also affected their plans.

In the Pipeline

Way back in June 2009, while addressing a joint session of the Parliament, President Pratibha Patil had announced the governments intention to establish 1 CSC in each gram panchayat, thereby increasing the total number of CSCs to 250,000.

And the government has even set a deadline of 2012 for the completion of this exercise. Whats even more interesting to note is that while the previous target of setting up 1 lakh CSCs is already running behind schedule (it was expected to be rolled out by June 2010 and is now expected to be over by March 2011), the government has gone ahead and promised a near-impossible target to achieve an additional 1 CSC in each gram panchayat.

Stuti Das
stutid@cybermedia.co.in