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Spiral b of master thesis new1

  1. 1. MEDNARODNA PODIPLOMSKA ŠOLA JOŽEFA STEFANAJOŽEF STEFAN INTERNATIONAL POSTGRADUATE SCHOOL SATYA PRAKASH PATEL COMMON SERVICE CENTER (INTERNET CONNECTED SERVICE DELIVERY KIOSK): UNLOCKING THE POTENTIAL OF RURAL INDIA MASTER THESIS LJUBLJANA, JUNE 2011
  2. 2. COMMON SERVICE CENTER (INTERNET CONNECTEDSERVICE DELIVERY KIOSK): UNLOCKING THEPOTENTIAL OF RURAL INDIA SATYA PRAKASH PATEL
  3. 3. Master ThesisJožef Stefan International Postgraduate SchoolLjubljana, Slovenia, May 2011Evaluation Board:Prof. Dr. Ivo Šlaus Chairman, Rudjer Boskovic Institute, Zagreb, CroatiaProf. Dr. Marko Hočevar, Faculty of Economics, University of Ljubljana, SloveniaProf. Dr. Peter Stanovnik , Member, Institute for Economic Research, Ljubljana, Slovenia
  4. 4. SATYA PRAKASH PATELCOMMON CENTER (INTERNET CONNECTED SERVICEDELIVERY KIOSK):UNLOKING THE POTENTIAL OFRURAL INDIAMaster ThesisSKUPNI STORITVENI CENTER (KIOSK ZA SPELTNODOSTAVO STORITEV): SPROSTITEV POTENCIALARURALNE INDIJEMagistrsko deloSupervisor: Prof. Dr. Peter StanovnikLjubljana, Slovenia, June 2011
  5. 5. VIITable of ContentsAbstract......................................................................................................................... XAbbreviations..............................................................................................................XII1. Introduction ............................................................................................................ 12. The Aim, Goal and rationale of the thesis.............................................................. 32.1 Aims of thesis......................................................................................................... 32.2 Goal ....................................................................................................................... 32.3 Argumentation of the relevance - Why CSCs?........................................................ 32.4 Rationale for CSC .................................................................................................. 43. Methodology and materials .................................................................................... 53.1 Methodology .......................................................................................................... 53.2 Materials ................................................................................................................ 5 3.2.1 Secondary Sources ........................................................................................... 5 3.2.1.1 Market survey............................................................................................ 5 3.2.1.2 Interviews .................................................................................................. 6 3.2.1.3 News Papers .............................................................................................. 6 3.2.1.4 Research Work .......................................................................................... 6 3.2.1.5 Project Reports .......................................................................................... 6 3.2.1.6 Journals ..................................................................................................... 7 3.2.1.7 Books ........................................................................................................ 7 3.2.2 Primary Sources ............................................................................................... 73.3 Limitations ............................................................................................................. 84. Concept and Literature Review ............................................................................. 94.1 Introduction............................................................................................................ 94.2 Role of ICT ............................................................................................................ 94.3 Impact of Broadband on Economic growth........................................................... 10 4.3.1 Global scenario............................................................................................... 11 4.3.2 Indian Scenario .............................................................................................. 114.4 Digital divide........................................................................................................ 124.5 e-Governance ....................................................................................................... 12 4.5.1 Linkages between ICT, Governance Reforms and Development..................... 13 4.5.2 ICT enabled Governance Reforms in India: Facts, Figures ............................. 134.6 Inclusive Growth.................................................................................................. 144.7 Financial Inclusion ............................................................................................... 154.8 Demographic Dividend......................................................................................... 154.9 Internet connected service delivery kiosk scheme in other part of world. .............. 16 4.9.1 Comparison between CSC, s of India to CeC, s of Philippines........................ 165. National e Governance Plan (NeGP) of India...................................................... 195.1 Introduction.......................................................................................................... 195.2 NeGP: Goal, vision, strategy and framework ........................................................ 195.3 Strategy of NeGP ................................................................................................. 20
  6. 6. VIII5.4 Framework of NeGP ............................................................................................. 205.5 Component of NeGP............................................................................................. 21 5.5.1 Mission Mode Projects ................................................................................... 22 5.5.2 Core Infrastructure:......................................................................................... 23 5.5.2.1 Connectivity: State Wide Area Networks (SWANs)/NICNET................... 23 5.5.2.2 National Data Bank/ State Data Centres (SDCs) ....................................... 23 5.5.2.3 Common Service Centres (CSCs): primary mode of delivery ................... 245.6 Conclusion:........................................................................................................... 256. Common Service Centres: The Front End Service Delivery Channel ............... 276.1 Introduction .......................................................................................................... 276.2 Goal, Objectives and Characteristics of CSC......................................................... 276.3 Technological Framework of CSC ........................................................................ 28 6.3.1 Three Pillars of CSC’s Infrastructure .............................................................. 286.4 Organisational Framework of CSC ....................................................................... 306.5 Service Framework of CSC................................................................................... 30 6.5.1 Approach of Services Framework ................................................................... 31 6.5.1.1 Bottom up approach .................................................................................. 31 6.5.1.2 End-to-End Services................................................................................. 32 6.5.2 Services offered by CSC ................................................................................. 326.6 Opportunity Space/Market Potential of CSC Project ............................................. 34 6.6.1 Analysis of CSC Offered Services and Customer need.................................... 34 6.6.2 e-Government Services................................................................................... 35 6.6.3 B2C services and B2B Services ...................................................................... 357. Challenges and Issues in CSC Project’s Implementation.................................... 397.1 Implementation Status .......................................................................................... 397.2 Challenges and Issues in the Implementation of CSC Scheme............................... 39 7.2.1 Delay in deployment of G2C services .............................................................. 39 7.2.2 Lack of Entrepreneurship in VLEs.................................................................. 41 7.2.3 Lack of capacity building effort ...................................................................... 41 7.2.4 Inconsistent Connectivity and Electricity ........................................................ 42 7.2.5 Inadequate content in regional languages ........................................................ 43 7.2.6 Lack of Awareness about ICT and CSC Scheme............................................. 438. Strategic Analysis of CSC project ........................................................................ 458.1 Introduction .......................................................................................................... 458.2 SWOT Analysis of CSC Project............................................................................ 458.3 Porter’s Five Forces Analysis of CSC ................................................................... 478.4 Business Map/Ecosystem analysis of CSC ............................................................ 498.5 Value Chain Analysis of CSC ............................................................................... 50 8.5.1 Primary Activities of CSC ............................................................................. 52 8.5.2 Support Activities of CSC............................................................................... 528.6 Findings of Strategic Analysis of CSC Project ...................................................... 539. The Business Model Analysis of CSC: Sustainabilityand fianacial viability of CSC................................................................................................................... 559.1 Introduction .......................................................................................................... 55
  7. 7. IX9.2 Concept of business model ................................................................................... 559.3 Value Proposition of CSC .................................................................................... 569.4 Business model of Tele centers in world and in India............................................ 569.5 Basic Business Model of CSC .............................................................................. 579.6 Business Model developed by SCAs from Field Experience ................................. 58 9.6.1 Cost sharing Business model of CSC.............................................................. 59 9.6.2 Employee Business model of CSC.................................................................. 599.7 Framework of CSC’s business model ................................................................... 59 9.7.1 Key Expenses or Cost drivers of CSC............................................................. 59 9.7.2 Revenue sources............................................................................................. 60 9.7.3 Investment size............................................................................................... 60 9.7.4 Critical Success Factors.................................................................................. 609.8 Cash Flow Analysis of CSC ................................................................................. 61 9.8.1 Cost detail and Cash Flow Analysis of Jalalpur CSC ...................................... 62 9.8.2 Revenue Inflow Analysis................................................................................ 64 9.8.3 Expenditure or Revenue out flow analysis of CSC.......................................... 68 9.8.4 Cash flow Analysis of Jalalpur CSC ............................................................... 689.9 Results of Cash Flow Analysis ............................................................................ 709.10 Knowledge Based Business Model of CSC........................................................... 71 9.10.1 Main feature of this business model .............................................................. 7210. Discussion and Suggestions................................................................................. 7511. Conclusion........................................................................................................... 7911.1 The Scope of Further Research............................................................................. 80References .................................................................................................................... 81Index of Figure ............................................................................................................ 85Index of Table .............................................................................................................. 87Appendix-I ................................................................................................................... 89Appendix-II.................................................................................................................. 91Appendix-III ................................................................................................................ 97Apendix-IV: Publications of Author........................................................................... 99
  8. 8. XAbstractRural India is on the brink of a transformation. An ICT (information and communicationtechnology) driven transformation will unlock the potential of the rural communities andtransmute the socio-economic landscape of rural India. The Government of India launched anational e-Governance plan (NeGP) in May 2006. The aim of this plan is to bridge urban-ruraldivide and to harness ICT for addressing the major socio-economic problems of rural India.Common service center project (CSC: Internet connected service delivery kiosk) is a part ofNeGP in which 100,000 CCS will cover all 600,000 villages of India on honey combmodel(one CSC cover six villages) is being implemented in a public private partnership (PPP)mode. The CCS seeks to transform rural India by delivering access to e-government services,education, agricultural service, health and telemedicine services, financial, commercial andentertainment services at their door step on affordable prices. These CSCs create new jobopportunity to rural people and provide new distribution channel to companies for theirproducts/services in rural market. Each village will transform into knowledge center and CSCwill integrate these knowledge centers with world knowledge economy. This thesis describedabout the technological, service and organisational frame work of CSC. The CSC offeredservices have enormous market potential in rural India. For tapping this market potential it isimportant to understand the issues and challenges are encountered during implementation ofCSC project. The efforts have been done to identify the factors that determine the sustainabilityand viability of CSC and analyse these factors through strategic analysis. The four strategicanalysis tools-SWOT, Porter’s five forces, Value Chain and business map/eco system of CSCare used in this thesis. The complete cash flow analysis of a CSC has been done in this thesis toquantify and specify the critical success factors that are responsible for sustainability andviability of CSC. The suggestions are floated on the basis of strategic analysis and cash flowanalysis to develop a sustainable and viable business model of CSC. This thesis also suggested along lasting sustainability and profitability model of CSC like knowledge base business model ofCSC. This CSC project is a tool for achieving inclusive growth of rural India.
  9. 9. Abstract XI
  10. 10. AbbreviationsB2B=Business to BusinessB2C=Business to CitizenBPO=Business Processing OutsourcingCSC=Common Service CenterCSP=Content and Service ProviderDIT=Department of Information Technology GDP=Gross domestic product.ICT=Information and Communication TechnologyIT/ITeS=Information Technology/Information Technology enables servicesMMP=Mission Mode ProjectMIS=Management Information SystemNREGA=National Rural Employment Guarantee ActNeGP=National e Governance PlanNICNET=National Information Center NetworkNLSA=National Level Service AgencyPC=Personal ComputerPPP=Public Private PartnershipRTI=Right to InformationSCA=Service Center AgencySDA=State Designated AgencySDC=State Data CenterSPV= Special Purpose Vehicle
  11. 11. XIII
  12. 12. 11. IntroductionIndia is the 4th largest economy of the world after U.S.A., China and Japan based on purchasingpower parity GDP. [1] The country is growing with GDP 8 to 9 % per annum. However, thereexists a stark contrast between the rural India and urban India. Indian rural population is yet toexperience the basic services like primary education, agricultural extension, health and socialservices, insurance, telecom and banking services. Fruits of high growth rate are yet to be sharedwith 740 million deprived rural Indians to bridge the gap between rural India and urban India.During recent years efforts are being made to bridge this gap through the effective use ofinformation and communication technology (ICT).India’s 11th Five Year Plan (2007-2012) structured a new broad based paradigm focussingespecially on alleviating poverty by initiating inclusive growth. The plan formulated a national egovernance plan (NeGP) with a vision of providing all government services in an integratedmanner in “Web-enabled Anytime, Anywhere access” format to rural population at their doorstep and on affordable cost [2]. As per this plan 100,000 common service centres (CSCs) wereproposed to be established during 2008-2013, covering 600,000 villages on honey comb modelthat is one center cover six adjacent villages. The basic aim of the CSC project is to bridge thedevelopment gap between urban and rural India for developing the nation. This gap can bebridge through empowering the rural people and enhancing their income. The access togovernment services empowering and business services makes access to market to rural peoplethat enhancing their income. These CSCs are a broad band internet enable kiosk for deliveringgovernment and private services in rural areas through a private-public-partnership (PPP) model.The CSCs are meant to provide high quality and cost effective video, voice and data content, inthe areas of e-Government, education, health, telemedicine, entertainment as well as possiblegovernment and private services. The goal of the CSC Project is to empower the ruralcommunity and catalyse social change through modern technologies. These CSCs are envisagedto become a vehicle for rural inclusion and inclusive growth to unlock the potential of ruralIndia. In chapter-2 aim, goal, relevance and rationale of the thesis are presented. Chapter-3describes the methodology and materials used in this thesis work. The conceptual foundation ofthe study is analysed in chapter four. Here, all relevant concepts and key words are explainedunder the sub-section literature review. The chapter -5 explain about National e-Governance Plan(NeGP) of India which lay the foundation of Common service Center (CSC) project. The CSCproject is one of the integrated mission mode projects (MMP) of NeGP. Common servicescenters are described in chapter-6. This chapter is divided into two parts. Part –I explain aboutthe technological, organisational and service framework of CSC while part-II highlights aboutmarket size and opportunity space for CSC offered services. This part also analyse the customerneed and CSC offered services. The Chapter -7 is based on the implementation status of CSCproject in India and type of challenges encountered by it. Strategic analysis of CSC project isexplained in chapter-8. The objective of the strategic analysis is to identify the core issues andcritical success factors that determine the sustainability and financial viability of CSC project.Four strategic analysis tools, namely, SWOT, Porter’ Five Forces, Value chain and Businessmapping are used for that purpose.
  13. 13. 2The Chapter-9 describes the concept and framework of CSC’s business model with cash flowanalysis of a CSC based on primary data collected from the field. This analysis specifies andquantifies the core issues and critical success factors that are identified through strategic analysisof CSC project in chapter-8. Finally this thesis reveals and analyses the prospects of CSCs onrural India and how it may become a vehicle for unlocking the potential of rural India andachieve an inclusive growth.
  14. 14. 32. The Aim, Goal and rationale of the thesis 2.1 Aims of thesisThe aim of the CSCs project is to bridge the development gap between urban and rural Indiawith the view of developing the nation. This gap can be bridge through empowering the ruralpeople and enhancing their income. The access to government services empowering andbusiness services makes access to market to rural people that enhancing their income.The aims of this thesis are--(i) To analyse the potential of rural India and how this potential can be unlocked throughcommon services center project.(ii) Identify the core issues and critical success factors through strategic analysis of CSC projectthat are responsible for sustainability and profitability of CSC project.(iii) Specify and quantify the core issues and critical success factors through cash flow analysisof CSCs and float suggestions for developing a sustainable and financially viable business modelof CSC. 2.2 GoalThe goal of the CSC project is to empower the rural community and catalyse social changethrough modern technologies. These CSCs will become a vehicle for rural inclusion andinclusive growth to unlock the potential of rural India.‘ The goal of this thesis is to make a small contribution to pave the path for sea changes on thesocio-economic landscape of rural India by making CSCs sustainable and financially viable, sothat CSCs become a vehicle to achieve the goal of the CSC project.’ 2.3 Argumentation of the relevance - Why CSCs? — These are following arguments for regarding the relevance of CSCs in rural India to achieve an inclusive growth.(i) Rural India is at a disadvantage due to lack of access to information, knowledge, credit,livelihood opportunities and market linkages.(ii) Coping costs of basic services high, therefore low disposable incomes(iii) Rural India is poor, but not bankrupt – willingness to pay is very high
  15. 15. 4(iv)The Government as well as private sector keen to reach out to rural India.(v) A systematic and structured model that focuses on shared access, rural entrepreneurship andmarket mechanisms can work wonders. 2.4 Rationale for CSCThe CSC project was launched by Government of India in 2006. The main rationales for CSCsare as follows--(i) To bridge the Urban and rural developmental and digital divide in India(ii) Enhancing empowerment to rural people through access to government services/information(e-governance) at their door step.(iii) Reduce the poverty in rural area through-- (a) increasing job opportunity (b) enhancingempowerment (c) improving financial security. Opportunity makes market work for the poorand expands poor people assets. Empowerment makes state institutions work better for poorpeople and removes social barriers. Security helps poor people manage risk.(iv) New access to knowledge, information and education in the remotest part of India. Thesecommon service centers (CSCs) will integrate with world knowledge economy through IT/BPOservices.(v) Achieve an inclusive growth in India to include the large proportion of under privilegesection of society into growth process. The ultimate goal is to improve the economic conditionand improve the living standard of rural people to fuel the growth of India.(vi) Rural IT skilled work force (trained by CSC offered educational services) should be utilizedto trickle down the benefits of IT industry in rural area for an inclusive growth.
  16. 16. 53. Methodology and materials 3.1 MethodologyThis study is based on secondary as well as primary sources of data. As a part of secondarysources, several website linked to the common services centers programme including the websiteof the Ministry of Information Technology (www.mit.gov.in), Government of India, thecommon service center website (www.csc-india.org) along with several such websites reportingthe status of these CSCs including the website of SCAs have been referred. Several researchpapers, books, reports, journals, newspapers and surveys are also referred. The draft document ofCSC-2006, Department of Information Technology (DIT), Government of India; compendium ofMMP- 2010, D.I.T, and Government of India are main reports consulted. To understand themarket opportunity market size, demand of CSC offered services we used the AC Neilson-ORGMARG survey (2008) and PwC survey results on CSC.Primary data are collected from field through personal effort. A semi structured survey wasconducted in rural community and VLEs. Cost data and cash flow data were also collected fromVLEs. Semi structured interviews were conducted through internet with all stakeholders of CSCproject (government officers, technical, academician, SCA and VLEs). The data were collectedfrom tehsil Anoopshahar, district-Bulandshahar (Uttar Pradesh) India to study the marketpotential of government services. Primary data are collected from the state of Uttar Pradesh,India to increase the understanding of different issues related to implementation of CSC projectand that determine the sustainability and viability of CSC project. The strategic analysis hadbeen performed by using four different tools to identify the core issues and critical successfactors that determine its sustainability and financial viability of CSC project. Four tools ofstrategic analysis SWOT, Porter’s Five Forces, Value Chain and Business Mapping are used forthis purpose. The cash flow analysis of a CSC had been done to specify and quantify the coreissues and critical success factors that are identified in strategic analysis of CSC. 3.2 Materials3.2.1 Secondary SourcesThe following secondary sources are used for top down market research. These are the availablemarket survey, research, project reports, journals, books and other available relevant secondarysources.3.2.1.1 Market survey · ANC-MARG market survey on CSC. Base line survey to identify location criteria, basket of priced services and revenue potential foe CSCs-Uttar Pradesh, India Report, January,
  17. 17. 6 2008 by ORG Center for Social Research-A division of AC Nielson ORG-MARG Pvt. Ltd. · Base line survey to identify location criteria, basket of priced services and revenue potential foe CSCs-National Report ,Executive Summary January, 2008 by ORG Center for Social Research-A division of AC Nielson ORG-MARG Pvt. Ltd.]. · Sahaj Seri Village Limited. Sahaj(A SCA) Mitra portal, www.sahajcorporate.com, access on 25-02-2011 · Market Survey 2008-09, by Indicus Analysis pvt. ltd., New Delhi, web site: www.indicus.net3.2.1.2 Interviews · Interview of Shankar Agrawal ,Joint Secretary DIT, GOI available at Shajcorporation.com3.2.1.3 News Papers · The Financial Times of India, 11th Feb.2011 · Dainik Jagran Hindi Newspaper · Dainik Hindustan Hindi Newspaper3.2.1.4 Research Work · Status of common service center programme in India: Issue, challenges and emerging practices for rollout. By-Rajanish Das and Atashi Battacherjee-I.I.M. Ahmadabad, India, February 2011, W.P. No-2011-02-03, page 20. · What role can ICT enabled Governance Reforms play in India’s Development? Dissertation MPA, LSE 2009 ,A dissertation submitted by Dipinder Sekhon to the MPA Programme, London School of Economics and Political Science, in part completion of the requirements for the MPA Public and Economic Policy May, 20093.2.1.5 Project Reports · Draft document of CSC, Department of Information Technology, Government of India, Volume-I, · Administrative Reform Commission (India) Report, 2008, page. 129
  18. 18. 7 · Compendium of MMPs 2010,page no99-102,Published by department of information technology, Government of India · Telecom Regulatory Authority Of India: National Broadband Plan Recommendations on 8th December, 2010,page,61 · U.N. Millennium Development Goals 2010. · International Telecom Report(ITU),20103.2.1.6 Journals · Transforming Government – government Initiatives in India, Editors: R K Bagga and Piyush Gupta, Published by: The ICFAI University Press, The Icfai University Press52, NagarjunaHills, Punjagutta, Hyderabad, India–500 08, 2009.page33 · Business model analysis by Richard G. Hamermesh, Paul W. Marshall, Taz Piromhamed; January22, 2002, page 1, Harvard Business School Publication No-9- 802-048.3.2.1.7 Books · The world is Hot ,Flat and Crowded by Thomas L. Friedman,2010, New York · Club of Rome: No limit to knowledge , but limit to poverty(2002) · Can information & communication technology application contribute to poverty reduction? Lesson from rural India by- Simone cchinia & Christopher; Aeclac, United Nation, casillea, Santeago, Chile. · Transforming Government – government Initiatives in India, Editors: R K Bagga and Piyush Gupta, Published by : The ICFAI University Press, The Icfai University Press52, NagarjunaHills, PunjaguttaHyderabad, India–500 08, 2009.page333.2.2 Primary SourcesThe primary sources were collected from field to understand the scope of CSC offered servicesand challenges encountered in the implementation of CSC project. These primary data werecollected from the state of Uttar Pradesh in India. The questionnaires were used for conductingthe survey among rural people and village level entrepreneurs (VLEs).The interviews were alsoconducted through internet from all stakeholders of CSC project. All these questionnaires areannexed in annexure number-I, II and III. The cost detail and cash flow data were collected froma CSC. This CSC is situated in village-Jalalpur, district-Raebarelly, (Uttar Pradesh), India. Thevillage level entrepreneur (VLE) of this CSC is Mr. K.K.Anjan, a 22 year old having post
  19. 19. 8graduate degree in Economics. The cash flow analysis had been performed on the basis of thesedata to specify and quantify the core issues and critical success factors that determine thesustainability and financial viability of CSC. The primary data were also collected from thetehsil (a sub –divisional administrative unit) Anoopshahar, district- Bulandshahar (UttarPradesh), India to evaluate the market potential of government to citizen (G2C) services forCSCs. 3.3 LimitationsDue to physical distance from Slovenia to India the bottom up study is only possible throughinternet.
  20. 20. 94. Concept and Literature Review 4.1 IntroductionThe literature review discusses published information in a particular subject area and sometimesinformation in a particular subject area within a certain time period. A literature review can bejust a simple summary of the sources, but it usually has an organizational pattern and combinesboth summary and synthesis. Literature reviews provide us with a handy guide to a particulartopic. These reviews also provide a solid background for a research paper/thesis. This thesis isbased on the application of information and communication technology (ICT). The CSCs areinternet connected services delivery kiosk that provides government and business services torural people on affordable cost at their door step. The CSC project is empowering the ruralpeople and catalysing the social changes in rural community through ICT. This project is alsoenhancing the income of rural people by increasing job opportunities for them. This project isbridging the digital divide and developmental divide between urban and rural India that finallyleads to achieve an inclusive growth in India. The key words that explain these concepts andideas are analyzed in the section on literature review.Key Words:Role of ICT, digital Divide, broadband and its impact on economic growth, e-Governance,empowerment, inclusive growth, demographic dividend. 4.2 Role of ICTCommon service centers are an internet connected service delivery kiosk providing governmentand business services to rural people of India on an affordable cost at their door step. The goal ofthe CSC Project is to empower the rural community and catalyse social change through moderninformation and communication technologies. The Club of Rome published a statement in 2002to World Summit on Sustainable Development 2002(Johannesburg) named as— No limit toknowledge, but limit to poverty[3]. This is a compilation of different essays. In that statement thechapter-The limit to poverty and inequality emphasised the importance of ICT as—informationand communication technologies are doubly essential for faster growth in developing countriesand more eco-friendly growth everywhere. Reducing the digital divide must be therefore becomea world-wide priority. In the statement of Club of Rome under chapter Towards a sustainableKnowledge Society indicates the impact of ICT in society as—the dynamics of information andcommunication technology development within the globalised market alone will contribute togeneral wealth and reduce poverty .Within the right frameworks, it can empower and integratebillions of people, even in the poorest countries; offer new access to education, information andknowledge even in the most remote regions ;help to eradicate poverty and build sustainable
  21. 21. 10society. Thomas L. Friedman famous American journalist wrote in his famous book “Hot,Flat&Crowded”2010-Global economic field become levelled due to personal computers, internetand software and transmission protocol [4] An ICT (information and communicationtechnology) driven transformation will unlock the potential of the rural communities andtransmute the socio-economic landscape of rural India. The CCS seeks to transform rural Indiaby delivering access to e-government services, education, agricultural service, health andtelemedicine services, financial, commercial and entertainment services at their door step onaffordable prices. The CSCs will help lay a solid foundation for economic prosperity of ruralIndia. ICT can reduce poverty by improving poor people’s access to market. [5] SimoneCecchinia and Christopher explained this fact in their book –‘Can information & communicationtechnology application contribute to poverty reduction? Lesson from rural India’- “ICT canreduce poverty by improving poor people’s access to markets. It is clear that in rural India -aswell as in much of the developing world- realization of this potential is not guaranteed.Attacking Poverty identifies three priority areas for reducing poverty: increasing opportunity,enhancing empowerment and improving their financial security. Opportunity makes marketswork for the poor and expands poor people’s assets. Empowerment makes state institutions workbetter for poor people and removes social barriers. Security helps poor people manage risk.”Information and Communication Technologies (ICTs) are part of MDG (millenniumdevelopment goal) and have an impact on other MDGs. The target 18 of goal 8 (Developmentand global partnership for development) mentions the following: ‘in cooperation with the privatesector, make available the benefits of new technologies, especially information andcommunications technologies. According to UN availability of broadband is important formaking important applications available to the population.’ To quote from the millenniumdevelopment goals (MDG) report- 2010 available on the UN MDG website “... a challenge inbringing more people online in developing countries is the limited availability of broadbandnetworks. Many of the most effective development applications of ICT, such as telemedicine, e-commerce, e-banking and e-Government, are only available through a high-speed Internetconnection. But a significant divide exists between those who enjoy fast access to an onlineworld increasingly rich in multimedia content and those still struggling with slow, shared dial-uplinks.”[6] 4.3 Impact of Broadband on Economic growthThe information and communications technology sector’s contribution to economic growthwidely recognized. Experts are of the opinion that the impact of broadband on the GDP is muchhigher than any other ICT. Broadband is by far the most important element of ICT today, havingthe largest impact of GDP. It is estimated that a 10 percent increase in teledensity contributes to0.6 percent of GDP growth. [7] & [8] .The consulting group McKinsey has estimated that- it isestimated that every ten percentage points increase in broadband penetration results in1.38percentage points’ additional GDP growth in developing countries. [9]
  22. 22. 114.3.1 Global scenario The importance of broadband has been recognized worldwide. According to ITU, forGovernments, broadband is a way of promoting economic development and social benefits.Countries world over have recognized the need for national broadband networks. Nationalbroadband network rollout becomes economically viable for two reasons. Firstly, researchconsistently shows that investment in any ICT has a direct positive effect on GDP growth.Secondly, broadband networks very quickly pay for themselves through the benefits that getdelivered across society in many different ways. Several countries worldwide, for example, theUS, Japan, Australia, Canada, Portugal, South Korea, Germany, Singapore and Finland haveidentified broadband as a potential infrastructure, enabling the national economic & socialgrowth. An analysis for the European Commission estimates that broadband can create morethan two million jobs in Europe by 2015, and an increase in GDP of at least EUR 636 billion. Astudy in Brazil reported that broadband added up to 1.4% to the employment growth rate. InChina, every 10% increase in broadband penetration is seen as contributing an additional 2.5% toGDP growth. [10] The Internet is largely recognized as a general purpose technology, andbroadband is regarded as a basic infrastructure, in the same way as electricity, water or roads.Many even consider the Internet as a“fundamental human right,” and some countries havestarted to put in place legislation stipulating that access to the internet is a human right for theircitizens [11] Finland is the first country in the world to make high-speed Internet access a legalright, obliging operators to provide connections of at least 1Mbps to every citizen. [12]4.3.2 Indian ScenarioThe TRAI report on National Broadband Policy, 2010 [13] state that—“pursuant torecommendations of TRAI, Government formulated Broadband Policy of 2004. In this policy,broadband was defined as an “always on” connection with downloads speeds of 256 kbps ormore. There were 0.18 million broadband connections at the end of March 2005. Thesebroadband connections have grown to 10.30 million by the end of September 2010.The numberof non-broadband connections till September 2010 was 7.6 million”. The Economic survey ofIndia 2010-2011 gives the picture of broadband growth as--With supportive policies, broadbandsubscribers grew from 8.77 million as in March 2010 to about 10.71 million up to November2010. A target of 20 million by 2010 has been set in the broadband policy of India -2004.Government of India establishing 100,000 CSC (internet connected service delivery kiosk) onhoney comb model (one CSC covers six adjacent villages) to cover all 600,000 villages of India.The CSC Scheme is to bridge the development and digital divide between urban and rural Indiawith the view of developing the nation. This internet expansion in rural India helps will help laida solid foundation for economic prosperity of rural India.
  23. 23. 12 4.4 Digital divideDigital Divide is meant for “digital divide" between the technology "haves" and the “haves not”.The digital divide now takes into consideration access, or lack of access, to the Internet, as well.In an ever more globalized world, communication and access to information is not a luxury, buta basic right that people must have for human development. ITU Report2010 show the digitaldivide through the data-internet user per 100 inhabitants-- Internet user per 100 inhabitants is inworld in 2010 is (30) while in Europe(65),America(55),CIS(46),Arab states(24.9),Asia-Pacific(21.9) and in Africa(9.6).This data in developed countries is (71.6) while in developingcountries(21.1)[14] The digital –divide is clearly depicted from the world wide internet userworld’s 75.8%internet user comes from top 20 countries while rest internet user24.2% comesfrom rest of countries(mostly are developing countries). Internet user’s distribution shows thatmost of the user from developed world in 2005 but in 2010 developing countries share graduallyincreasing.China on top position, followed by Amarica,Japan,Brazil&India.[15](World InternetStats., 2010) . In a report [16](BCG Report,2010) comparing Internet and PC penetration ofBRICI countries (Brazil, Russia, India, China, and Indonesia), Boston Consultancy Group statesthat -“ penetration in India is lowest. Penetration of Internet users(total internet user/totalpopulation) in India was only 7%, which is expected to reach 19% by 2015 . Similarly, PCpenetration in India was only 4% at the end year 2009, which is expected to reach 17% by2015.” According to Economic survey of India 2009-2010 total internet user in India tillDecember 2009 was 81 million.[17] In India accessibility of internet expanded fast in recentyear with supportive policies, broadband subscribers grew from 0.2 million in 2005 to 10.71million in November 2010.[18] . According to IMRB&IAMAI I-Cube Report 2009-2010[19]internet user in India---a large proportion of user access internet from office and cybercafé--in year 2009 cyber cafe37%, office 30%,home 23%,school/college4% and others 4% .Mostof the offices and cyber cafes are situated in urban area. The Confederation of Indian Industries(CII) [20] is point out the slow growth and urban-rural divide of broadband in India. ‘Thebroadband growth has not only been slow but also biased in favour of urban areas. More than60% broadband subscribers are in the top ten metros and tier-I cities and more than 75%connections are in top 30 cities. Just 5% of the broadband connections are in rural areas whichare meagre compared to about 31% of total mobile telephone connections in rural areas’.[ 21] 4.5 e-GovernanceThe word ‘governance’ has increasingly replaced ‘government’ in policy literature. It usuallyrefers to the relationships and transactions between the government and the citizens. However,government may still remain responsible for the delivery and regulation. Good governance isusually associated with efficient, productive, high performance, corruption free, transparent, andaccountable and increasingly ‘citizen centric’ government. A government truly working in thebest interest of citizens, and taking care of their needs and doing so in the most effective andcustomer friendly manner and at par with services provided by the best in the private sector.[22]
  24. 24. 13‘governance’ and ‘ICT enabled governance’ mean more or less the same thing. At times, there isa tendency to limit governance to ‘government websites’ but now Web 2.0 makes interactivewith citizen. The potential for ICT enabled governance is immense.4.5.1 Linkages between ICT, Governance Reforms and DevelopmentICT, governance reforms and development are linked to each other in different ways.Development is a complex multi-causal phenomenon. Governance reforms are one of the manyfactors that influencing the development. ICT is linked to development via governance reforms.ICTs have had a much more significant direct impact on development rather than via eGovernance initiatives. Phenomenal growth in IT/ITeS in India is the best example. India hasaround 55% share in world IT/ITeS industry of world. This has led to the creation of thousandsof jobs, valuable foreign exchange earnings for the country, boom of other businesses like ITenabled services, BPO/KPO etc. In fact, IT sector has been the poster boy of India’s economicgrowth story. [23]. However, a large percentage of e- Governance initiatives have been failures -in all developing countries, including in India[24](IIIT-Banglore,2005), [25]( Heeks R.,2004)While no one can deny direct benefits of ICT for Development, one of the major bottlenecks fordevelopment in India is the state of governance.4.5.2 ICT enabled Governance Reforms in India: Facts, Figures India’s size and diversity makes implementation of nation-wide reform and changes extremelycomplex and challenging. However, there have been significant progressive shifts over the last64 years since independence. The Second Administrative Reforms Commission (ARC)constituted in 2005 under the Ministry of Personnel, Public Grievances and Pensions has thebroad mandate to revamp the public administration system. The eleventh report of ARC titled‘Promoting e-Governance: The SMART way forward’ published December 2008 brings eGovernance to the forefront of national governance reform efforts for the first time. [26](ARC,2008) The e -Governance agenda in India at the national level has been articulated in theNational e Governance Plan (NeGP) to be implemented at an estimated cost of Rs. 23,000 crores(~ USD 4.66 bn.)9 over five years [27] NeGP was formulated by the Department of InformationTechnology (DIT) and the Department of Administrative Reforms and Public Grievances (DIT,2009). NeGP comprises of 27 Mission Mode Projects (MMPs) and 8 core/supportcomponents10, and was approved on May 18, 2006. The MMPs include 9 projects in the centralgovernment category, 11 projects in state government category and 7 projects in integratedservices category as listed in the figure below. The projects are in varying stages ofimplementation: some are already fully operational, some are being implemented and some arestill being conceptualised [28] (ARC, 2008, P.134) CSC is one the integrated mission modeproject. The goal of CSC is providing government and business services to rural people onaffordable cost at their door step. They will be the end point hubs of government IT
  25. 25. 14infrastructure in rural areas, and will provide services in the areas of e Governance, education,health, telemedicine, entertainment etc. as well as other private services. The scheme is beingimplemented with private sector partnership, and is likely to be completed by June 2011[29] thetotal approved cost of Rs. 5742 crores (USD 1.44 bn.), 4093 cores (71%) will be provided by theprivate sector, 856 crores (15%) by the central government and 793 crores (14%) by the stategovernments. The implementation is being coordinated by a National Level Service agency(NLSA) appointed by DIT, which oversees a 3-tier implementation framework. The frameworkconsists of State designated agencies (SDAs) to facilitate implementation in each state Servicecentre agencies (SCAs) at the second/middle level (‘franchiser’, for one or more districts) andVillage level entrepreneurs (VLEs) to operate the CSCs and service rural customers. The designand PPP model of the CSC project seems to suggest that lessons learnt from past projects andprevious phases and pilots have been taken into account. The story of telecentre/CSC movementin India (CSDMS, 2008) is significant because it is the first ICT4D intervention of its kind, trulydesigned to reach each and every village in India. It evolved over the last two decades since1990s beginning with an era of conceptualisation by the likes of Prof Jhunjhunwala and M SSwami Nathan [30] (MSSRF,2004,June) followed by an era of experimentation by players likeDrishtee, TARAhaat, n-Logue etc. and now the implementation era with NeGP’s CSCprogramme[31] 4.6 Inclusive GrowthIn recognition that the country’s development is unsustainable if it fails to include the largeproportion of disenfranchised population into the growth process; the Government of India hasintegrated “inclusive growth” as the conceptual corner stone of its 11th Five Year Plan. Theentire underprivileged section is the potential user of ICT. The TRAI Report Broadband2010[32] states that—‘the inclusive potential of ICT is evident at two levels: the benefits that itbrings to poorer communities and the capacity of individuals within these communities toparticipate in new economic opportunities. ICT, particularly broadband, is, therefore, seen as apowerful tool for inclusive growth’. There is an urgent need for a nation-wide Broadbandnetwork to reach Education, healthcare, banking and other services to all the villages of India.Such a network would truly help in realising the objective of inclusive growth. Common servicecentres (CSC) schemes is mile stone in achieving this goal. [33] The Eleventh Five Year Plan(2007-12) of India highlights the need for inclusive growth. In the Foreword to the Eleventh FiveYear Plan document, Hon’ble Prime Minister of India emphasised --the need to ensure thegrowth is widely spread so that its benefits, in terms of income and employment, are adequatelyshared by the poor and weaker sections of our society. For this to happen, the growth must beinclusive in the broadest sense. It must occur not just in our major cities but also in our villagesand small towns. [34]
  26. 26. 15 4.7 Financial InclusionThe 11th five year plan talks about inclusive growth. It an not be realized without financialinclusion. Financial inclusion is a crucial part of development. There are close to 47,000 bankbranches across the country. However, access to credit and institutional finance have still notreached the mainstream population including 48% of all households, 51% of farm householdsand 78% of non-farm households who are not included in the organised banking system.[35](Koccher, Sammeer, 2010) 100,000 CSCs, manned by local entrepreneurs (VLEs) and operatedby qualified private franchisees (SCAs), can act as the catalysts for extending banking services atthe last mile. For Banks, the CSCs represent a huge opportunity of an organized network that canfull fill their vision and goals of financial inclusion in rural India. RBI has issued a formalCircular on appointment of ‘Business Correspondents’ and Facilitators -to ensure greaterfinancial inclusion and to increase the outreach of banking activities in rural areas. Such amodel offers a perfect fit for banks to integrate and extend their outreach through the CSCs. [36](Bhargwa, Alok, 2007) The VLEs are using the credit cards to undertake the following activitiesfor the villagers: booking of online railway tickets, booking of airline tickets online shopping forwatches, cameras etc. 4.8 Demographic DividendICT has brought rural areas much closer to the markets and has improved business transactions.India’s technological capabilities and rising exports in information technology (IT) have beenone of the major drivers of growth. Goldman Sachs Economic Research paper on “India’s Risinggrowth Potential” (Global Economics Paper No: 152) dated January 22, 2007 indicates thatIndia’s GDP (in US$ terms) will surpass that of the US before 2050, to make it the secondlargest economy.[37] The underlying assumption in continuation of the growth story is thatgrowth-supportive policies are continued to be implemented. The cited report emphasizes that tocontinue growing, India will have to educate its children and its young people (especially itswomen). Lack of education can be a critical constraint to the growth of the knowledge-based ITsector, as well as in the move to mass employment in manufacturing. It is important to educatepeople to take the advantage of the demographic dividend. The demographic dividend arisesfrom the fact that more than 50% of its population of India is below the age of 25 and more than65% hovers below the age of 35. This makes India one of the youngest countries in the world. Itis being increasingly recognized that what matters is not the size of the population, but its agestructure. A population "bulge" in the working age groups (15-64 years), however large the totalpopulation, is an inevitable advantage. Thus, India, which is beginning to be characterized bysuch a bulge, is seen as advantaged, despite its large population. [38] Common services centresprovide access to education, IT educations and English skill in rural area. India have the biggestEnglish speaking people in the world around 330 million. This gives the edge to India in worldIT/ITeS industry of the world.
  27. 27. 16 Figure 1: Changes in population pyramid --India (1971-2016) Source: TRAI National Report on Broadband, December, 2010. 4.9 Internet connected service delivery kiosk scheme in other part of world. Countries across the world are increasingly adopting e-government initiative through telecentersin an effort to reach out to their citizen provide them access to various government services, is acommonplace knowledge. The telecenters are not a new phenomenon in developing countries.As early as 1994 the Buenos Aires Action Plan called for multipurpose community telecenters inrural remote areas. Different states of India also implemented such type of project like Gyandootin Madhya Pradesh, Lokvani in Uttar Pradesh, Bhoomi and Nemadi project in Karnatka andKRIPs in state of Gujrat. CSC project is formulated with assimilating the failure and success ofthese projects. The CeC of Philippine is very similar to CSC project.4.9.1 Comparison between CSC, s of India to CeC, s of PhilippinesGovernment of Philippines implemented Common e Centres(CeC) with the use of killerapplications – i.e., applications and services that create a high and pro-poor developmentalimpact, and encourage replication. This is important for the long-term sustainability and viabilityof Community e-Centers (CeCs) in the Philippines.These centres are very similar to the commonservice center of India. These include, particularly, services that residents find relevant enoughthat they are willing (and able) to pay for their use, such as Internet access, communications
  28. 28. 17software and productivity suites. It also covers other services such as photocopying and CDreplication that, while not necessarily Internet or computer-related, do provide CeCs withadditional sources of revenue that help ensure their survival, especially in rural and unnervedareas. The Philippine Government, particularly Local Government Units (LGUs), have utilizedthe CeC model to offer various e-governance services. [39] CeC & CSC are the conduit of e-governance; both are based on private-public participation model (PPP model) and are operatedon government push top- down approach but in future they develop on community pull bottom-up approach. CeC and CSC‘s success will depend on following parameter-citizen’sempowerment; citizen’s participation; accountability& transparency and sustainability. CeC&CSC helps to brings governments closer to the people in a more efficient, transparent&accountable way.
  29. 29. 18
  30. 30. 195. National e Governance Plan (NeGP) of India 5.1 Introductione-Governance is the interweaving of government development processes with a range of moderninformation processing and communication technologies (including the Internet, Local AreaNetworks, mobiles etc.) to improve effectiveness, efficiency and service delivery whilepromoting democracy by making them equitably available to all. But why do we need e-governance? e- Government can transform citizen service, provide access to information toempower citizens, enable their participation in government and enhance citizen economic andsocial opportunities, so that they can make better lives, for themselves and for the nextgeneration. [40]. E-Governance is increasingly being viewed as the route for governments tostrengthen good governance, for it not only improves efficiency, accountability and transparencyof government processes, but it can also be a tool to empower citizens by enabling them toparticipate in the decision-making processes of governments. [41].Services provided through thevarious e- Government initiatives assist governments in reaching the yet ‘unreached’ and therebycontribute to poverty reduction in rural and remote areas by increasing access to criticalinformation and opportunities. At the same time, this process also enables involvement andempowerment of marginalized groups through their participation in the government process.Over the past decade or so there had been islands of e Governance Initiatives in the countryat the National State district and even block level .e.g. Gyandoot, Bhoomi, Lokvani, Dhristi ,Jan Seva Kendra etc. Some of them had been highly successful and were ready for replicationacross other States while some have not produced the desired results or withstood the test oftime. Experiences from successes as well as the failures of the various initiatives played animportant role in shaping the e Governance strategy of the country. The government of Indialaunched National e Governance plan (NeGP) in May 2006.This chapter cover the goal, visionand strategy of NeGP and also the framework of NeGP and its core components. Commonservice centres are the one of the integrated MMPs. How NeGP laid the foundation andinfrastructural support to CSC project. 5.2 NeGP: Goal, vision, strategy and frameworkThe National e-Governance Plan (NeGP), is the flagship e-governance programme of the Centralgovernment. The plan lays the foundation and provides the impetus for the long term growth ofe governance with in the country. The plan seeks to create the right governance and institutionalmechanism, set up the core infrastructure and policies and implement a number of mission modeprojects (MMPs) at the center, state and integrated services levels to create a citizen centric andbusiness centric environment for governance. [42] NeGP’s goal is the provision of improved,more convenient government services countrywide through on-line delivery at local servicecenters. NeGP takes a holistic view of e-Governance initiatives across the country, integrating
  31. 31. 20them into a collective vision, a shared cause. Around this idea, a massive countrywideinfrastructure reaching down to the remotest of villages is evolving, and large-scale digitizationof records is taking place to enable easy, reliable access over the internet. The ultimate objectiveis to bring public services closer home to citizens, as articulated in the Vision Statement ofNeGP. “Make all government services accessible to the common man in his locality, throughcommon service delivery outlets, and ensure efficiency, transparency, and reliability of suchservices at affordable cost to realise the basic needs of the common man” [43]. 5.3 Strategy of NeGPThe strategy of NeGP contains the following elements-(I)Centralized initiative, decentralize implementation.(ii)Identify services to be targeted(iii)Prioritize services (Mission); identify measurable goals (out comes)(iv)Create mechanism for effective private sector participation(v)Put in a place a common infrastructure, policies, standards and framework.(vi)Service delivery through CSCs(vii)Think big, start small and scale fast(viii)All services supported by three infrastructure pillars to facilitate ‘web-enabled, anytime,anywhere access’ connectivity: state wide area network (SWAN/NICNET); national databank/state data centers (SDCs); CSC- The primary mode of service delivery channel 5.4 Framework of NeGPThe framework of e Governance consist three part—back-ends, middle ware and front endservice delivery channel (e.g. national/state data centers). The back-ends includes data base ofdifferent government agencies, service providers, state government etc., while middle warecomprises of communication and security infrastructure, gateways and integrated servicesfacilitating of interdepartmental services(e.g. SWAN). The front end delivery channel consist ofhome PCs, mobile phone, kiosk, integrated citizen services centers like CSCs
  32. 32. 21 The figure2.-Framework of National e-Governance Plan (NeGP. Source: The e Governance Approach in India: The National e Governance Plan (NeGP) By Dhrupad Mathur, Piyush Gupta and A. Sridevi, 2009] 5.5 Component of NeGPA major initiative of the Government for ushering in e-Governance on national scale, calledNational e- Governance Plan (NeGP) was approved on 16th May 2006. NeGP consists of 27Mission Mode Projects (MMPs) encompassing 9 central MMPs, 11 State MMPs and 7 integratedMMPs that span multiple backend Ministries/ Departments. It also includes 8 program supportcomponents aimed at creating the right governance and institutional mechanisms, coreinfrastructure, policies & standards and the necessary legal framework for adoption of e-Governance in the country. It is implemented at the Central, State and local government levels.[44] The e Governance agenda in India at the national level has been articulated in the National eGovernance Plan (NeGP) to be implemented at an estimated cost of Rs 23,000 crores (~ USD4.66 bn.) over five years [45]. NeGP was formulated by the Department of InformationTechnology (DIT) and the Department of Administrative Reforms and Public Grievances. [46].NeGP comprises of 27 Mission Mode Projects (MMPs) and 8 core/support components. These 8components are as follows--(i) Core policies(ii) Core Infrastructure (SWAN, SDCs etc.)(iii) Support Infrastructure (CSCs etc.)(iv)Technical Assistance(v) R&D(vi)Human Resources Development and Training(vii) Awareness and Assessment(viii) Organisation Structures
  33. 33. 225.5.1 Mission Mode ProjectsThe MMPs include 9 projects in the central government category, 11 projects in stategovernment category and 7 projects in integrated services category as listed in the table--- below.Table 1. India’s NeGP: Scope of Output (Mission Mode Projects). Mission Mode" impliesthat the objective and the scope of the project are clearly defined, that the project has measurableoutcomes and service-levels, and the project has well-defined milestones and timelines forimplementation. MMPs are owned and spearheaded by various Line Ministries concerned forCentral, State, and Integrated MMPs. The concerned Ministry/ Department is entirelyresponsible for all decisions related to their MMPs. [47] Table 1: Scope of NeGP and mission mode projects (MMP) of NeGPServices Central State IntegratedServices · Income · Land records · Common Services to Tax · Property registration Centers(CSC)Citizens · Passport, · Road transport · State Wide Area (G2C) visa and · Agriculture Network SWAN: immigrat · Municipalities fiber ion · Panchayats · E-Posts · Police · All India Portal · Employment · National Service Exchange Delivery · Education Gateway(NSDG)Na · Health tional E-Governance Gateway · Food Distribution & other welfare programs
  34. 34. 23Services Excise · Commercial Taxes · EDI- Electronic to Company affairs DataBusiness Interchange (for (G2B) trade, E-Commerce)Custom foreign trade · E-Biz · E- Procurement Other · National · Treasuries · E-Courts ID · National GIS for planningSource: The e Governance Approach in India: The National e Governance Plan (NeGP) ByDhrupad Mathur, Piyush Gupta and A. Sridevi, 2009The projects are in varying stages of implementation: some are already fully operational, someare being implemented and some are still being conceptualised [48]5.5.2 Core Infrastructure:All services supported by 3 infrastructure pillars to facilitate web-enabled Anytime, Anywhereaccess-5.5.2.1 Connectivity: State Wide Area Networks (SWANs)/NICNETThe establishing Wide Area Networks in all States and UTs across the country, from the Headquarter of each State/UT to the Blocks. It would serve in providingG2GandG2Cservices,especially for the various Mission Mode Projects.-5.5.2.2 National Data Bank/ State Data Centres (SDCs)The State Data Centres (SDCs) would consolidate data, services, applications and infrastructureto provide efficient electronic delivery of G2G, G2C and G2B services across the state anddepartments. They will be seamlessly interconnected with Common Services Centres (CSCs) upto village level via minimum 2 Mbps State Wide Area Networks (SWANs). Its key functionswould be to act as the Central Repository of the State provides secure data storage, disasterrecovery and remote management functions etc.
  35. 35. 245.5.2.3 Common Service Centres (CSCs): primary mode of deliveryThe front –end interface of the scheme with rural citizen is common service center throughwhich the government services would be delivered along with value added services. Figure 3: Core Infrastructure of NeGPSource: Compendium of MMPs 2010, Published by department of information technology,(DIT) Govt. of Indiahttp://www.mit.gov.in/sites/upload_files/dit/files/Compendium_FINAL_Version_110211.pdfaccess on 16-05-2011
  36. 36. 25 5.6 Conclusion:e Governance in India is progressing well with participation of government as well as privateactors. Things have begun to be systematically coordinated at the national level with theNational e Governance Plan (NeGP). As the NeGP has been developed jointly by Department ofInformation technology-India (DIT) and Administrative Reforms Commission (ARC), there is afair amount of alignment of e Governance plan with the overall governance reform agenda.While NeGP is a central plan, it is being implemented in a decentralised fashion by both publicand private actors. Several projects in the NeGP are in fact ideas which originated as state orlocal government initiatives, and which were deemed fit to be replicated all over the country.The projects are in varying stages of implementation- some are already fully operational, someare being implemented and some are still being conceptualised .Common service center is anintegrated MMP is successfully under the implementation. Till 30thApril 94,000 CSC has beenrollout. Framework and core infrastructure of NeGP are supporting the CSC project and playingvital role in its roll out process.
  37. 37. 26
  38. 38. 276. Common Service Centres: The Front End Service Delivery Channel 6.1 IntroductionThe Government has approved the Common Services Centres (CSC) Scheme for providingsupport for establishing 100,000 Common Services Centres in 600,000 villages of India. TheScheme envisions CSCs as the front-end delivery points for Government, private and socialsector services to rural citizens of the country in an integrated manner. It has been decided thatthe Common Services Centers will be suitably repositioned to be a network of Panchayats levelBharat Nirman Common Services Centers, to provide Government services to the citizens inrural areas. [49] The objective is to develop a platform that can enable Government, private andsocial sector organizations, to align their social and commercial goals for the benefit of the ruralpopulation in the remotest corners of the country through a combination of IT-based as well asnon-IT based services. The Scheme has been approved at a total cost of Rs. 57,420 crore( oneCrore=10 million) with the Government of India contribution being Rs. 856 crore and StateGovernments contribution being Rs. 7,93 crore. [50] The balance funds would be brought in bythe private sector. 6.2 Goal, Objectives and Characteristics of CSCThe CSC is a strategic corner stone of the National e-Governance Plan (NeGP), as part of itscommitment in the National Common Minimum Programme to introduce e-governance on amassive scale. The CSCs would provide high quality and cost-effective video, voice and datacontent and services, in the areas of e-governance, education, health, telemedicine, entertainmentas well as other private services. A highlight of the CSCs is that it will offer web-enabled e-governance services in rural areas, including application forms, certificates, and utility paymentssuch as electricity, telephone and water bills. [51] The project creates a healthy environment forthe private sector and NGOs to play an active role in implementation of the CSC project, therebybecoming a partner of the government in the development of rural India. The private publicpartnership (PPP) model of the CSC scheme envisages a 3-tier structure consisting of the CSCoperator (called Village Level Entrepreneur or VLE) the Service Centre Agency (SCA), that willbe responsible for a division of 500-1000 CSCs and a State Designated Agency (SDA) identifiedby the state government responsible for managing the implementation over the entire State.
  39. 39. 28 6.3 Technological Framework of CSC6.3.1 Three Pillars of CSC’s InfrastructureTechnological framework of CSCs is based on the core infrastructure of National e Networks(SWANs), State Data Centres (SDCs) and Common Services Centers (CSCs). All services aresupported by 3 infrastructure pillars to facilitate ‘web-enabled anytime, anywhere access’.Technological framework of CSCs is based on the core infrastructure of National e Networks(SWANs), State Data Centres (SDCs) and Common Services Centers (CSCs). All servicessupported by 3 infrastructure pillars to facilitate web-enabled Anytime, Anywhere access. TheGovernment has approved the project for establishing State Wide Area Networks (SWANs)across the country. SWANs are connecting all State/UT headquarters up to the block level viadistrict/sub divisional headquarters, in a vertical hierarchical structure with a minimumbandwidth capacity of 2Mbps per link. The State Data Centre (SDC) Scheme is for establishingdata centres across 35 States/UTs across the country was approved by the Government on 24thJanuary 2008, over a period of 5 years. The concept is to create State Data Centres (SDC) for thestates to consolidate infrastructure, services and application to provide efficient electronicdelivery of G2G, G2C and G2B services. These services can be rendered by the states throughcommon delivery platform seamlessly supported by core connectivity Infrastructure such asState Wide Area Network (SWAN) and Common Services Centre (CSC) at the village level.The Common Service Centres (CSCs) are the primary mode of service delivery. TheGovernment has approved the Common Services Centres (CSC) project for providing supportfor establishing 100,000 Common Services Centres in 600,000 villages of India. The Schemeenvisions CSCs as the front-end delivery points for Government, private and social sectorservices to rural citizens of India, in an integrated manner.There is a National Data Center (NICNET) which is connected to all government department andagencies of central and state government of India. All 28 state government and 7 union territoriesof India have a State Data Center (SDC), connected with NICNET. Main role of SDC aresecuring and hosting of data and its application. Its key functions would be to act as the centralrepository of the State, provide secure data storage, disaster recovery and remote managementfunctions etc. These would consolidate services, applications and infrastructure to provideefficient electronic delivery of government to government(G2G) , government to citizen(G2C)and government to business(G2B) services through common delivery platform seamlesslysupported by the State Wide Area Network (SWAN) connecting up to the villages through theCommon Service Centres (CSCs) with speed 2mbps.State Wide Area Network(SWAN) isserving government to government (G2G) services and government to citizen services(G2C),especially for various mission mode projects(MMPs) of National e Governance Plan(NeGP) likeCSC. Once all the CSCs are established and all the Government service delivered online, theutility of broadband will increase for rural masses. ‘The CSCs are envisaged to provide highquality and cost effective video and data services in the areas of e-governance, education, health,agriculture, entertainment as well as other private services. As the video content are supposed toconsume sizable bandwidth, the bandwidth requirement for each CSC would be approximately 2
  40. 40. 29Mbps, which may increase in future. Common service centres (CSCs) are broad band enableservice provider kiosk having at least following technical infrastructure-two P.C.s/laptop ,twoprinter(inkjet+ dot matrix),web/digital camera, wireless connectivity ,bio metric devices,UPS/invertor/ generator and further technical infrastructure may be enlarged and upgraded.CSCs technology is unique in compare to other players(like cyber café ,e- kiosk of privatecompanies) in the market who providing web based government to citizen(G2C),business tocitizen(B2C) and business to business(B2B) services to citizens .Broad band speed is quite highin compare to others. CSCs have access to government services and portals while other marketplayers have not such type of access. Figure 4: Technological framework of CSCsSource: upgov.nic.in (Web site of Department of IT& Electronics, Govt. of Uttar Pradesh, IndiaCSCs have a technical infrastructural support of NICNET, SDC and SWAN while other marketplayers have not get access to high quality technical infrastructure. CSCs have an legal sanctityon other hand other can’t get such recognition, so the credibility of CSCs are more in society incompare to other market players. CSCs technology offers integrated services from singlewindow .Dimensions of the application of CSCs technology are very wide. These CSCs arebecoming the vehicle of inclusive growth in rural area and bridging digital divide between ruralIndia and urban India. They are the end point hubs of government IT infrastructure in rural areas,and will provide services in the areas of e Governance, education, health, telemedicine,entertainment etc. as well as other private services. The CSCs themselves have been envisionednot just to provide IT hardware and services, but also to encourage rural empowerment,entrepreneurship, knowledge economy and inclusive growth in rural India.
  41. 41. 30 6.4 Organisational Framework of CSCThe CSCs scheme is being implemented with private sector partnership (of the total approvedcost of Rs. 5742 crores (USD 1.44 bn.), 4093 crores [one crore=10 million] (71%) will beprovided by the private sector, 856 crores (15%) by the central government and 793 crores bystate government. [52] The implementation is being coordinated by a National Level Serviceagency (NLSA) appointed by Department of Information Technology, Government of India(DIT), which oversees a 3-tier implementation framework. The framework consists of statedesignated agencies (SDAs) to facilitate implementation in each state, service centre agencies(SCAs) at the second/middle level (‘franchiser’, for one or more districts) and village levelentrepreneurs (VLEs) to operate the CSCs and service rural customers. Table 2 : Stake holders of CSC project and their role. Stakeholder Level Role State Designated Agency Nodal Agency at State Level Monitoring & Supervision (SDA) Service Centre Agency(SCA) Implementing Agency Investor and prime mover Village Level Local Level Entrepreneur Actual Operator at CSC Entrepreneur(VLE) levelAt the first level the agency designated by the state is the State Designated Agency (SDA)-tofacilitate implementation of the Scheme within the State and to provide requisite policy, contentand other support to the SCAs .At the middle level is an entity termed as State Service Agency(SCA-loosely analogous to a franchiser) to operate, manage and build the village level networkof CSCs and business. They are the prime driver of this scheme. At the third level there are thelocal Village Level Entrepreneur (VLE-loosely analogous to a franchise), to deliver the serviceto the rural consumers in a cluster of six 6 villages. VLEs are selected by SCAs. 6.5 Service Framework of CSCThe CSC Scheme as approved by Government of India in September 2006 for setting up of100,000 internets enabled centers in rural areas under the National e Governance plan (NeGP) isbeing implemented in a public private partnership (PPP) mode.
  42. 42. 316.5.1 Approach of Services Framework6.5.1.1 Bottom up approachThe common services centers (CSCs) are proposed to be the front end delivery points forGovernment, private and social sector services to rural citizens of India at their doorstep. TheCSC Scheme is envisaged to be a bottom-up model for delivery of content, services, informationand knowledge, that can allow like-minded public and private enterprises through a collaborativeframework to integrate their goals of profit as well as social objectives, into a sustainablebusiness model for achieving rapid socio-economic change in rural India’[53] It is thecommunity participation and collective action, not ICT alone, which will lead to a behaviourchange for a sustainable socio-economic change and long-term rural prosperity. Figure 5: Selected Service Center Agency (SCA) state wise detailSource: website www.csc-india.org as access on 15th May2011.
  43. 43. 326.5.1.2 End-to-End Services The key driver for the selection of content and services would be their end-to-end applicability.This means that a specific content/ service should be in a marketable format for it to be selectedas a part of the service network in the CSCs. Broadly, the services selection would be on theirability to impact the consumer through the saving cost, helping income generation and enablingsocio –economic generation. Figure 6: Service framework of CSCSource: State level workshop on e-Governance (17th April2008) at Luck now, Uttar Pradesh,India organised by department of IT& Electronics, Government of Uttar Pradesh, India.6.5.2 Services offered by CSCCSCs are offering government ot citizen(G2C),business to citizen services(B2C) and business tobusiness(B2B) service to rural people as well for government and private companies.
  44. 44. 33 Table 3. Type of services offered by CSCsG2C:Government to Citizen services e-Government Services- · Land records · Market Linkages · Registration of vehicles · Education · Issue of certificates · Healthcare · Government schemes · Agricultural ,Extension etc. , · Employment exchange · Data collection · Ration cards · Rural BPOs · Electoral services · Rural banking · Pension schemes · Road transport · Public grievance · Utility/ Telephone Bills (Government undertakings)(B2C) services Business-to-Business services (B2B)(i) Commercial Services- · Advertising & promotion services · Digital photos · Marketing ,Promotions · web surfing · Data collection services · photocopy& DTP · Research data collect · e-mail/chats · Data entry · CD burning · Distribution services · Typing& printing, · FMCG products · games · Financial services, loans/deposits, · forms downloads referrals, insurance etc. · Utility/telephone bills (private enterprises).(ii) e-Commerce/Online Services – · Railway tickets · Astrology · Matrimonial & Resume · Shopping (iii) Education Services-IT education,English skills training, tuitions.(iv) Entertainment-DTH, community TV.(v) Telemedicine- Primary healthcare.(vi) Agriculture Services-Agriculture-inputs, agriculture –loans, agriculture –consulting and
  45. 45. 34 6.6 Opportunity Space/Market Potential of CSC ProjectAs above mention service framework of CSCs offered service itself reveals the opportunityspace for CSCs. These services are empowering the rural people and bring transparency andaccountability in government functioning, creating new job and enhancing their income. Theservices are also providing new access to education, knowledge, micro- financing, agricultureextension and health Services. They are expected to catalyse the social change and socialdevelopment. This market linkage is opening new economic opportunity and also providing newdistribution channel for products and service in rural area. These CSCs are emerging as a villageknowledge centers providing IT and vocational education to rural youth. These IT educatedyouths become valuable human resources for exponentially growing IT/ITeS outsourcingindustry in India. This cheap and qualified human resource will contribute in national economyand in that way IT /ITes industry will penetrate in deep rural area of India. Summarily, theseCSCs offered services are enabling to create long lasting prosperity in rural India. The Neilson-ORG Survey report on CSCs published in the month of January 2008 clearlyexplains the opportunity space for CSCs and service uses pattern and its response in rural India.The survey was conducted in 2006 in all the states of India.The average monthly income ofsurveyed people was found Rs.4737. The report provided a conservative estimate of the totalexpenditure that a household could spend on CSC offered different services at 6.75% of a meanmonthly expenditure of Rs. 4739. This implies that the amount available for CSC transaction isRs. 320 per month per person.[54] Sahaj Srei Sahaj e-Village Pvt. Ltd ( a SCA) estimated in2008 that rural Indians spend Rs.639 per month on CSCs offered services. Average population inthe catchment area of one CSC is 8159 on the basis of population of India in 2007 (totalpopulation of India 1.02 billion). So total opportunity per CSC per month is worked out aroundRs. 52,13,601(5.2 million rupees.) [55] Hence the total opportunity available for 1,00,000 CSCsper month in country is around Rs.521 billion. Presently on an average only 5% to 10%opportunity is tapped by one CSC.6.6.1 Analysis of CSC Offered Services and Customer needServices offered through CSCs are empowering the rural people and enhancing the income andmeeting the social goals by providing access to agricultural health, finance related services andeducation .CSCs are opening new distribution channel to different product and services to undertapped rural market.IT/ITeS and rural BPO/KPO are generating wealth and increasing the wealthof nation. ACN ORG survey conducted (on CSC) in 2006 explains the service uses and copingcosts on transportation in rural areas. This survey explains the service uses and coping costs ontransportation in rural areas. This report reveals that –‘ rural Indian people spend maximumexpenditure on transport to avail these three services namely-agriculture related services,health related services and education.’ The report also explains the buyer’s preference onservices offered by CSCs on 100 households (roughly 500 population) geographical anddemographical unit. It suggests an optimum population in the catchment area of one CSC is8159.
  46. 46. 35The basket of CSC’s services is described as the top revenue generating services as per thereport.6.6.2 e-Government ServicesIn our own survey of CSCs conducted in Uttar Pradesh most of the respondents admitted thatthey spend around Rs. 200 to. Rs. 300 to get a certificate from government offices and spenttime of between one day to 7 days.Table No 4 : Government to Citizen services(G2C) issues from Tehsil Anoopshahar, District:Bulandshahar(U.P.),India Tehsil- Name of e Government Services Number of User in Anoopsha year 2010 har(U.P.) (01-01-2010 to31- 12-2010) 1 Land Records(Khatuni: Records of Right) 32,440 2 Residence/Domicile certificate 3,304 3 Caste Certificate 8,761 4 Income Certificate 16,468 Total 60,973Source :Tehsil office Anoopshahar(district-Bulandshahar),Uttar Pradesh-IndiaPresently a citizen takes this certificate from tehsil head quarters. They travel around 15 to 20kilometre and lose their wages for one day which comes on an average to Rs. 120. They alsospent on travel, snacks and processing charges. Generally people spent around Rs. 200/ to Rs.300 directly or indirectly for getting one certificates. These services may be delivered fromCSCs when they become functional. In this case official charges for land record will be Rs.25,for caste/residence and Income certificate it will be Rs. 20 and State government charge for landrecord Rs.10. Accordingly, the total income generated from these four services works out to beRs1,057,260. There are 18 CSCs in this tehsil, so income generated by one CSC in one monthfrom these four e Government services comes to Rs 4894. This is a sizable amount for sustaininga CSC owner. Government of Uttar Pradesh included total 35 government services in the basketof CSC offered services. This study indicates that CSCs can easily sustain as soon as theseservices add in CSC offered services list. In conclusion, these CSC offered e Governmentservices would not only save money and time but also empower rural people and bring themcloser to government. This citizen –government interface will lead to develop the faith ingovernment and induce government machinery to become more accountable and transparent.6.6.3 B2C services and B2B ServicesTable 5 clearly indicates that lion’s share of revenue generation comes from computer,vocational education and tuition. ANC ORG survey on educated village youth in Uttar Pradesh
  47. 47. 36reveals that -“Across the habitations under survey, on an average there are 148 persons who arein illiterate or just literate category. Among the literates, on an average, 104 youths have studiedup to 10th class, while 94 youths have studied up to 12th class. The average number ofprofessionals emerged as 60 youths in sample villages of Uttar Pradesh. Of those who attainedsome professional education, 38% were employed as professionals and 7% were service (govt.,private or tuitions). However, 32% such professionally qualified were still engaged in cultivationor in some kind of labour work.”[ 56 ]These 32%professional educated youth can enhance theirskill through CSCs offered vocational education , computer education and English speakingcourse . The IT educated youth then becomes a prime driver of emerging rural economy of India.If major Indian IT/IteS companies expand their network up to CSC level through SCA then thisIT skilled manpower would be able to deliver more profit as their wages is quite low ascompared to metro cities of India. Indian IT/IteS industry can take leap frog in the world ofIT/IteS industry and penetrate at grass root level of rural India. Profit of outsourcing will betrickle down in the rural society. In brief, long lasting rural prosperity may be achieved throughinformation superhighway and CSCs may acts as vehicle of inclusive growth. Table : 5 Top 80% Revenue Generating Services of CSC Services Annual Revenue for 100 household size villages (Rs.) Basic Computer Training 9491 Telemedicine 2955 Vocational education 2171 Land Records 1955 Application for New Passports/Change of name, address 1687 All tuitions 1563 Ticketing – Rail/Road/Air 1225 Agricultural consultancy & marketing facilities to the farmers for their produce 1167 Entertainment – movies 1112 Certificates available outside GP (Residency/caste/income/marriage/pow er of attorney/unemployment/disability certificate) 1105 Grievances 1066 Payment of all bills 992Source- Base line survey to identify location criteria, basket of priced services and revenuepotential of CSCs-National Report ,Executive Summary January, 2008 by ORG Center forSocial Research-An division of AC Nielson ORG-MARG Pvt. Ltd.
  48. 48. 37CSCs have a potential to become the gateway for tapping the rural market by way of offeringdifferent product and services. Indicus Analysis Pvt. Ltd., New Delhi survey report 2008-09explains that one sector that continued to gain steady despite of economic slowdown was themarket of personal care and home care product. Main reason for this growth trend was thesecompanies have discovered rural markets, which now contribute a little more than half the totalsale for such products in the country.”[57] The survey indicates that under tapped rural market ofIndia have enormous potential. Domestic computer hardware and software industry can alsoflourish. If companies smartly use the CSC channel, certainly their balance sheet showsencouraging result for them.In nut shell one can infer that CSCs offered services have enormous potential in economic termsas well as in social form. CSC empowers the rural people through government services and savetheir money and time. It creates new jobs and helps in poverty reduction. It also offers newaccess to financial, agricultural and health related services as well as new knowledge,information and education. Rural human resources become more productive due to proper accessto this service, make them more productive to contribute in nation’s economy. In this way Indiais able to harness its demographic dividend specially in IT/Ites outsourcing world Industry.Finally, CSCs may become the key to unlock the potential of rural India.
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