Is India prepared for the Next ICT Wave?

In the last decade (4 years to be precise) the global economy has witnessed considerable ups and downs and is still reeling under the apprehension of another slowdown. As a result, not only the global governments but also the enterprises have come forward to infuse energy and effectuate sustainable growth.

Overall, Europe remains at the forefront of the efforts to leverage ICT to transform its economy and society. Seven European counties are positioned in the top 10 of the rankings, with the Nordic countries, including Sweden at the very top, leading the way. Asia and the Pacific region is home to some of the world's wealthiest, most innovative and digitized nations in the world and also to some of its poorest, least connected countries.

 

India's ICT Standing

India (69) ranks last in terms of overall networked readiness index (NRI) in 2012 when compared to its counterparts like Brazil (65), China (51), Russia (56) and the US (8). But it is ahead of China (105) and Brazil (121) in terms of business innovation and stands proudly at the 91st place. Credit for this positively goes to India's huge percentage of youth who opt for entrepreneurial route and create employment rather than just seeking employment. Whereas China's institutional framework has lots of shortcomings that hamper entrepreneurship. In contrast, Russia, even with superb ICT penetration and innovation in technology, is still grappling with political instability. Therefore, Russia still has to overcome its restructuring flaws to leverage its strengths like before.

 

But India (100) fails miserably in terms of its ICT infrastructure and digital content and is a good 32 places behind Brazil (68), which commands a strong position due to its robust infrastructure and channelized approach towards ICT adoption. But when we talk about usage subindex (78) India again lags behind with individual usage (117) as only 7.5% of the Indian population uses internet and business usage (41) is slightly better. In comparison, the US (10) population uses internet 75% times more than us. India stands at a crossroad in readiness subindex (64), thanks to its numero uno position in the affordability pillar (1) in managing low score on skilled workforce (100). Although China (66) is not too far behind India in readiness subindex and Brazil (72) just is few notches below.

One silver lining is the Indian ICT impact subindex (52), which is an aggregate of healthy economic impact (41) and social impact (65) due to the rapidly growing influence of social networks and platform.

India

Almost 20 ranks behind China, India at 69th place presents a mixed picture??with encouraging results in a few areas and a lot of room for improvement in others. It lags in political and regulatory environment (71) and the business and innovation environment (91) as it takes four years and 46 procedures to enforce a contract. Starting a business is longer and requires more paperwork than in most countries. One of the weakest aspects of India??s performance lies in its low penetration of ICT and hence it ranks 117th in the individual usage pillar.

There are 61 mobile subscriptions for every100 population??a relatively low figure, 7.5% of the population uses the Internet and just 6% of the households own a PC. Competition and innovations at the lower level have catapulted India (1) in the affordability pillar, thus providing a significant boost to the country??s readiness. Government is emphasizing on ICT but whether this will translate into a transformation of the economy and society remains to be seen.

But already ICT is having a small transformational impact on the economy, which is partly reflected in India??s performance in the economic impacts pillar (41).

 

Brazil

Brazil, positioned narrowly above the middle range of the rankings at 65th place, benefits from strong levels of business ICT usage (33). These, combined with fairly advanced levels of technological capacity (31) in particular segments of its industry, allows the country to achieve one of the strongest performances of ICT-enabled innovations in the region, both in terms of new products and services (29) and more efficient processes (34). Notwithstanding these strengths, its overall business environment with its burdensome procedures to create new businesses (138) and its high tax rates (130), in addition to its high mobile cellular tariffs (133) and poor skill availability (86), hinder the potential of the Brazilian economy to fully benefit from ICT and shift toward more knowledge based activities (76) at a faster pace.

China

At the 51st place is China, leading the BRICS. But it has to address the challenge to fully adopt and leverage ICT. China's institutional framework (46) and especially its business environment (105) present a number of shortcomings with lofty taxation amounting to 64% of profits (124), uncertain intellectual property protection - it is estimated that almost 80% of installed softwares in China are pirated - and limited or delayed availability of new technologies (100th). In terms of readiness, the country ranks a low 87th in the infrastructure and digital content pillar, mainly because of its underdeveloped internet infrastructure. ICT usage by businesses is significant (37th) and the government is also placing hopes in ICT as a catalyst for future growth, which is reflective in its usage pillar (33). For the time being the impact of ICT on the economy remains limited (79).

Russia

The Russian Federation is among the best performers among the CIS countries (56). Despite having superiority in infrastructural development(40), it fails in having vision and commitment of the government to boost ICT as a driver of economic growth. The Russian Federation still maintains pockets of scientific excellence, but unfortunately they do not seem to spill over into the productive sector. This, coupled with a weak political and regulatory environment (102), and a somewhat entrepreneurship and innovation averse environment (83), affects the capacity of the country to reap the full economic benefits associated with higher rates of technology development (53).

United States

At 8th place overall, the United States delivers a strong performance. It features in the top 10 of 6 pillars in the report yet fails to make the top 3 of any. Almost all dimensions of the NRI offer room for improvement. The political and regulatory framework (21) presents some impediments but the business and innovation environment is more propitious (9). In terms of readiness, the country can rely on a very good (6) and affordable (10) ICT infrastructure. In order to further boost readiness, efforts are needed to upgrade the skillset of its population (32). In terms of individual usage, the US fails to play a leading role (18) as usage, though high, is not as widespread as in several other countries, most noticeably the Nordics.

Conclusion

As said and observed the global economies continue to face serious challenges in 2012, the impact of information and communication technologies (ICT) on each industry and economy has been a silver lining to the dark clouds. ICT with its transformational effects influences several sectors of the economy and society through innovations, the emergence of new industries, and the introduction of hyperconnectivity.

We, the global citizens, have become increasingly hyperconnected as we are in an environment with accessible and immediate internet and its associated services and spontaneous interaction between people and businesses through interconnected advanced machines. The exponential growth of mobile devices, big data, and social media are the major drivers of the hyperconnected world.

Now every where the innovative ICT strategies are intended to make the industry an enabler of future economic growth. As a result, converged ICT technologies are expected to bring in dramatic changes to our lives. So on one hand if hyperconnectivity presents a bright future, then on the other hand it also has thrown new challenges and risks in terms of security, cybercrime, privacy, the flow of personal data, individual rights, and access to information.

Keeping the overall benefits and challenges of ICT in fostering economy as a whole in mind in contrast with the current (not so exciting) status of India (as per the various rankings and scores in the The Global Information Technology Report 2012), the government of India not only has to promote innovative business models involving industry and academia to foster speedy adoption of ICT across the country but also has to lead by example by itself adopting ICT in a big way. Big way does not imply things simply on paper but in real action.