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ICT

India’s traverse to an Information Society

India, many argue, is on its way to becoming an Information Society. Riding on the back of the country’s success as a global provider of software and IT-enabled services, the government has declared its intention to ensure this transition by accelerating the spread of telephony, enhancing connectivity through cable, wireless, and satellite links and establishing a hundred thousand rural Common Service Centres (CSCs) — broadband-enabled computer kiosks that will offer a range of government-to-citizen and business-to-customer services.

The benefits from this engineered horizontal and vertical diffusion of the technology can indeed be immense. First, the increased use of Information and Communication Technology (ICT) in the agricultural and manufacturing sectors can fundamentally transform the nature of production, with major implications in terms of labour productivity, growth, and employment.

Secondly, the penetration of ICT into activities outside of production can reshape the way work, markets, and leisure are organised. The transformation of the way in which individuals and communities trade and access information and services can lead to changes in the structure of markets, improvements in the quality of life, a deepening of democracy, and major advances in terms of human development indicators. One area where such effects are tangible is electronic commerce, which allows for trading in virtual space, reduces transaction costs, cuts down on retail infrastructure, and slashes retail margins.

Finally, once access to the technology is provided to people, independent of their social and economic standing, and to decision-makers concerned with furthering human development goals, the ICT revolution can help the disadvantaged access services that increase their productivity and income, reduce their vulnerability to shocks of various kinds, and allow them to access remotely online education and training to increase their capabilities. It would also permit the government, civil society organisations, and private agencies to use ICT to deliver a range of services such as agricultural extension services and health services. These are indeed important benefits.

On the surface, success seems at hand. Conventionally, since connectivity is a core element of the new technology, a simple measure used to assess the degree of its diffusion is tele-density, or the number of telephones per hundred inhabitants in the country. Going by that measure, India may be on track to realising the Information Society objective. As the increasingly ubiquitous cell phone suggests, over the last few years, many, though not most, Indians have indeed been connected in ways they had not imagined before; both within the country and abroad.

Telephone density touched 18.72 as on April 30, 2007, compared with only 1.39 at the end of March 1994, when the shift to a new, more liberal telecom policy began. Mobile phones, which hardly existed a decade back, account for more than 80 per cent of that capacity. The pace of change suggests that the process is only gaining in dynamism. Tele-density increased from 2.86 on March 31, 2000; to 5 by March 31, 2003; 12.76 by March 31, 2006; and 18.72 at the end of April 2007.

But is this enough to deliver the benefits of an Information Society? It appears not, since average tele-density is not a good measure of the extent of diffusion. The aggregate figure conceals the extremely high degree of urban and regional concentration. Tele-density in rural India stood at 1.5 at the end of March 2003, when urban tele-density was placed at 14.3. By the end of December 2005, urban tele-density had risen to 34.8 whereas rural tele-density had gone up to just 1.8. Further, inter-regional variations were also substantial. As on December 31, 2004 while the total tele-density in the State of Delhi was 50.2, that in Bihar was as low as 2. Overall, the picture is indeed one of a digital divide driven by asset and income inequalities, such that there are a few at the top who are connected while the majority, preponderantly in rural areas, are marginalised from the communications network.

Further, India does not measure up well in terms of other measures of connectivity. To start with, as of now, data connectivity through mobile phones is limited. On the other hand, India still lags far behind many other developing countries in terms of the bandwidth (or the pipe) necessary for people to access simultaneously information flow through the Internet. The International Telecommunications Union estimates bandwidth availability in India in 2004 at 12,300 megabits per second (Mbits/sec), as compared with 24,704 in Singapore, 71,380 in South Korea, 48,921 in Hong Kong, 74,429 in China, 200,000 in France, 566,056 in Germany, 781,554 in the U.K., and 970,954 in the U.S. The number of broadband DSL (digital subscriber line) connections stood at 105,000 in India, as compared with 288,000 in Singapore, 6.8 million in South Korea, 790,000 in Hong Kong, 16.9 million in China, 6.3 million in France, 6.7 million in Germany, 5 million in the U.K., and 13.8 million in the U.S. India does not feature even in the top 20 countries in terms of the number of broadband subscribers.

Even if physical access to working computers and connectivity in the form of communications links are established, there is no guarantee that this would actually connect all Indians to the information-rich, interactive world of the Internet and to intranets offering specialised services. The principal bottlenecks to effective use may lie elsewhere. ICT use is directly related to literacy and levels of education. It is here that India lags both in terms of average achievement relative to most countries and in terms of the degree of universalism of primary education and even literacy.

One consequence is the still limited Internet usage in the country. According to Computer Industry Almanac Inc. (CIAI), an Internet consultancy, India ranked fourth in 2006 (after the U.S., China, and Japan) in terms of the absolute number of Internet users. The CIAI places the number of Internet users in these four countries at 206 million, 123 million, 86 million, and 51 million respectively. Thus, going by this source, India is indeed significantly online when compared with the rest of the world. The problem, once again, is the limited penetration these high figures imply when compared with India’s population. In 2005, Internet penetration in India amounted to just 4.7 per cent, as compared with 69.9 per cent in the U.S., 12.3 per cent in China, 67.1 per cent in Japan, and 66.5 per cent in South Korea. Further, independent surveys estimating the number of Internet users deliver much lower figures. One, conducted jointly by the Internet and Mobile Association of India and IMRB International, has reported that the number of Internet users in urban India in September 2006 stood at 37 million. Further, the IAMAI makes a distinction between “active users” who used the Internet at least once in the 30 days preceding the date of survey and “ever users.” According to its estimates, the number of active users in urban India stood at just 25 million in September 2006.

In sum, while the growth of telephony creates the impression of an increasingly connected country, this is no indicator of India’s actual transition to an Information Society. And if such a society is defined as one in a post-industrial phase of development in which the structure of the economy measured by sectoral GDP or employment shares has shifted in favour of the knowledge and information sectors such as education, research and development, mass media, information technologies and information services, the transition has only just about begun.