Digital literacy prompts India to push next phase of Aadhaar in Budget FY24

Women doing better in digital awareness among reasons for government to expand technology in policies

The government’s digital leap is gaining momentum. In January, the UIDAI decided to revise the Aadhaar database, asking all entities storing data for more than ten years to make revisions. It is a huge exercise to weed out duplicate Aadhaar information and update the numbers for integrating with all digital platforms through which the India government speaks with its citizens.

It is for this reason that Finance Minister Nirmala Sitharaman spent a considerable number of her Budget paragraphs to announce measures to expand the digital sector. These included plans for a National Data Governance Policy, a one-stop solution for identity and address updating by expanding the reach of Digilocker, creating an Entity DigiLocker for use principally by MSMEs and charitable trusts, and a Unified Filing Process for data citizens need to file with various government departments. Combined, the plans mean the government is budgeting for a tighter digital embrace with the citizens. “The use of technology in meeting policy objectives,” said Tirthankar Patnaik, chief economist at NSE, about the government’s digital plans.

Critically, the plans will expedite the development of India-based standards for data economy, in contrast with the US and the European Union standards.

Digital literacy

India’s jump in digital literacy means more business for sectors. For fiscal 2024, data centre investments are estimated to be close to $5 billion. Moving on the same lines, the Reserve Bank of India has expanded the usage of UPI for all travellers to India for shopping. The central bank expects, once introduced to the simplicity of the system, the habit will linger even when the travellers return home.

“The focus on digitalisation programmes of various ministries will help increase demand and make available anonymised data to startups through National Data Governance Policy, which will help in new product development in the industry”, noted Aniket Dani, Director-Research, CRISIL Market Intelligence & Analytics in a response to Business Standard.

While new announcements were made quickly, like co-lending models between banks and NBFCs, the Open Network for Digital Commerce and cloud-based platforms connecting with fintech companies, the Finance Minister’s budget paras show where the government’s interests lie. To secure citizens' information, the government has taken steps to discontinue data harvests seen as questionable. The ministry of information technology told Parliament that a pandemic-era contact tracing done through Aarogya Setu has been erased. “In accordance with the provisions of the said protocol, the contact tracing feature of the Aarogya Setu mobile application has been discontinued and contact tracing data collected through it has been deleted”, a Lok Sabha reply noted.  

This is also where the significance of the National Data Governance Policy comes in. A Budget announcement is a commitment by the government. Sitharaman hopes that the two arms of the policy, the Digital Personal Data Protection Bill and a framework for sharing of non-personal data, will both be subsumed under the National Data Governance Policy.

Dani said the “government has focused on utilization of the India stack for making available information and improving efficiencies with the whole value chain”.

Senior government officials said these initiatives are necessary, as the potential of Aadhaar usage seemed to have reached its limit under the current regulatory framework. The government has seeded almost all its programmes with the data and there can only be incremental changes now. There is a need to imagine new usage to expand the business they can support. The announcements, read together, promise so. Every Budget proposal relating to farmers, health, manufacturing or skill development, has a distinct focus on the Information and Communications Technology (ICT) sector.

Women do better in digital literacy

The digital investment seems to be paying back in unusual ways for the government, Data shows women have done better in the national digital literacy programme. The number of women certified as IT literate under the Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA) programme is 2.4 crore, while that for men it is 1.83 crore, shows data with the ministry of information and electronics technology.

The data is remarkable. One would expect that states in North India, men certified as digitally trained in villages outnumber women. But here too the trend is changing. In both Uttar Pradesh and Bihar, women outnumber men by a sizable margin. The effectiveness of the scheme has been studied by three agencies, IIT Delhi, Council for Social Development (CSD) and the Indian Institute of Public Administration (IIPA). A survey by IIPA notes that “almost 50 percent of the respondents stated that PMGDISHA helped them get a better job”.

As Indian companies and government officials held two days of high-level meetings in Washington for a new dialogue about emerging technologies, India will be keen to keep data close to its chest and use it as a bargaining tool.

Gender-wise certified candidates status under PMGDISHA scheme

States	Female	Male
Andhra Pradesh	800,476	243,562
Bihar	2,888,915	1,768,963
Gujarat	868,700	906,035
Haryana	603,538	595,730
Jharkhand	915,317	550,319
Madhya Pradesh	1,809,246	1,812,502
Maharashtra	1,850,591	1,591,153
Tamil Nadu	609,239	213,486
Uttar Pradesh	6,004,546	4,776,140
West Bengal	1,027,548	555,448
Country total	23,879,872	18,334,944
Source: Parliament reply

*Absolute numbers
Data as on December 2022