{"id":152746,"date":"2025-01-24T20:09:13","date_gmt":"2025-01-24T14:39:13","guid":{"rendered":"https:\/\/pwonlyias.com\/stage\/?post_type=current-affairs&#038;p=152746"},"modified":"2025-02-13T15:57:27","modified_gmt":"2025-02-13T10:27:27","slug":"indias-digital-economy","status":"publish","type":"current-affairs","link":"https:\/\/pwonlyias.com\/stage\/current-affairs\/indias-digital-economy","title":{"rendered":"Report on Estimation and Measurement of India&#8217;s Digital Economy"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The <\/span><b>Ministry of Electronics and Information Technology (MeitY)<\/b><span style=\"font-weight: 400;\"> has released a comprehensive report titled<\/span><b> \u2018Estimation and Measurement of India\u2019s Digital Economy.<\/b><\/p>\n<h2><span style=\"font-size: 18pt;\"><b>About the Report on Estimation and Measurement of India&#8217;s Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li><span style=\"font-weight: 400;\">The report is prepared by the<\/span><b> Indian Council For Research On International Economic Relations<\/b><span style=\"font-weight: 400;\"> and released by<\/span><b> MeitY.<\/b><\/li>\n<li><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-152706 alignright\" src=\"https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/241-679391c103542.webp\" alt=\"Digital Economy\" width=\"297\" height=\"298\" srcset=\"https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/241-679391c103542.webp 481w, https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/241-679391c103542-300x300.webp 300w, https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/241-679391c103542-150x150.webp 150w\" sizes=\"(max-width: 297px) 100vw, 297px\" \/><span style=\"font-weight: 400;\">It is an<\/span><b> attempt to compile the first set of credible, comprehensible, and current estimates of India\u2019s digital economy<\/b><span style=\"font-weight: 400;\"> based on an internationally accepted framework.\u00a0<\/span><\/li>\n<li style=\"list-style-type: none;\">\n<ul>\n<li><b>OECD Framework: <\/b><span style=\"font-weight: 400;\">India is first among developing nations, to use the OECD framework to estimate its digital economy.<\/span><\/li>\n<li><b>ADB Input-Output Approach:<\/b><span style=\"font-weight: 400;\"> The report also provides alternate estimates using the Asian Development Bank\u2019s input-output approach.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Purpose of the report: <\/b><span style=\"font-weight: 400;\">The insights from this report are invaluable for policymakers, businesses, and other stakeholders.\u00a0<\/span>\n<ul>\n<li><b>Policymakers<\/b><span style=\"font-weight: 400;\">: Accurate data helps make more informed decisions and create targeted interventions to support digital growth.<\/span><\/li>\n<li><b>Businesses<\/b><span style=\"font-weight: 400;\">: Understanding the digital economy&#8217;s impact can help businesses make strategic decisions, drive innovation, and stay competitive in a global market.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"text-align: center;\"><span class=\"vc_button\"><a href=\"https:\/\/www.pw.live\/batches\/upsc?utm_source=seo+upsc+batch&#038;utm_medium=seo+upsc&#038;utm_campaign=seo&#038;utm_id=upsc\" target=\"_blank\" rel=\"noopener\">Enroll now for UPSC Online Course<\/a><\/span><\/p>\n<h2><span style=\"font-size: 18pt;\"><b>Key Findings of the report<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Size of India\u2019s Digital Economy<\/b><span style=\"font-weight: 400;\">: In 2022-23, India\u2019s digital economy accounted for <\/span><b>11.74%<\/b><span style=\"font-weight: 400;\"> of national income, equivalent to <\/span><b>INR 31.64 lakh crore (~USD 402 billion)<\/b><span style=\"font-weight: 400;\"> in GDP.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Main Contributors<\/b><span style=\"font-weight: 400;\">:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The <\/span><b>digital-enabling industries<\/b><span style=\"font-weight: 400;\">, such as information and communication services, telecommunications, and electronic component manufacturing, contributed the most, accounting for <\/span><b>7.83%<\/b><span style=\"font-weight: 400;\"> of <\/span><b>Gross Value Added (GVA).<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The <\/span><b>new digital industries<\/b><span style=\"font-weight: 400;\">, including Big Tech, digital platforms, and digital intermediaries, contributed <\/span><b>2%<\/b><span style=\"font-weight: 400;\"> of GVA.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Traditional sectors such as <\/span><b>BFSI (banking, financial services, and insurance), trade, and education<\/b><span style=\"font-weight: 400;\"> also contributed about <\/span><b>2%<\/b><span style=\"font-weight: 400;\"> of GVA through their digital transformation.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s digital economy is moving beyond the ICT (Information and Communication Technology) sector, influencing many industries and boosting digital platforms in traditional sectors.<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-size: 18pt;\"><b>Future Growth Projections<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The report projects that by <\/span><b>2030<\/b><span style=\"font-weight: 400;\">, India\u2019s digital economy will contribute to nearly <\/span><b>one-fifth (20%)<\/b><span style=\"font-weight: 400;\"> of the national income.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The biggest growth is expected from:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The rise of <\/span><b>digital intermediaries<\/b><span style=\"font-weight: 400;\"> and <\/span><b>platforms<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Increased <\/span><b>digital diffusion<\/b><span style=\"font-weight: 400;\"> and digitalization across the economy.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In 2022-23, the digital economy accounted for <\/span><b>14.67 million workers<\/b><span style=\"font-weight: 400;\">, or <\/span><b>2.55%<\/b><span style=\"font-weight: 400;\"> of India&#8217;s total workforce.<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-size: 18pt;\"><b>Need for Quantification of the Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Essential to understand the <\/span><b>role of the digital economy <\/b><span style=\"font-weight: 400;\">in:<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Driving economic growth.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Generating employment opportunities.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Supporting sustainable development.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><span style=\"font-size: 18pt;\"><b>Challenges in Measuring the Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li><b>Defining the Digital Economy: <\/b><span style=\"font-weight: 400;\">The cross-cutting and integrated nature of digital technologies makes it difficult to define a distinct digital economy.<\/span><\/li>\n<li><b>Limitations of Existing Systems: <\/b><span style=\"font-weight: 400;\">The conventional system of national accounts is not designed to measure the digital economy.<\/span><\/li>\n<li><b>Global Context: <\/b><span style=\"font-weight: 400;\">Only few countries have attempted to measure their digital economy.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: center;\"><span class=\"vc_button\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+CSE+Books\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Check Out UPSC CSE Books From PW Store<\/span><\/a><\/span><\/p>\n<div class=\"vc_table_green\"><\/p>\n<table style=\"width: 99.6988%;\">\n<tbody>\n<tr>\n<th style=\"width: 100%; border-style: solid; border-color: #000000; background-color: rgba(184, 165, 217, 0.53); text-align: left; vertical-align: middle;\">\n<h2><span style=\"font-size: 18pt; color: #000000;\"><b>Key data about India\u2019s Digital progress<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Mobile subscription:<\/b><span style=\"font-weight: 400;\"> Of the latest estimated <\/span><b>8.36 billion mobile cellular subscriptions worldwide,<\/b> <b>1.14 billion<\/b><span style=\"font-weight: 400;\"> are in India.\u00a0<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Internet traffic:<\/b><span style=\"font-weight: 400;\"> India has the third highest average monthly data traffic, at<\/span><b> 16.9 GB.\u00a0<\/b><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>5G deployment:<\/b><span style=\"font-weight: 400;\"> India became the<\/span><b> second largest market for 5G smartphones<\/b><span style=\"font-weight: 400;\"> in 2024.\u00a0<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Digital identity:<\/b><span style=\"font-weight: 400;\"> As of January 8, 2024, India has given out over <\/span><b>1.3 billion biometric IDs.\u00a0<\/b><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Digital payments<\/b><span style=\"font-weight: 400;\">: Over <\/span><b>1644 billion digital transactions<\/b><span style=\"font-weight: 400;\"> took place in India in FY 2023-24, the highest volume for a country.\u00a0<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>ICT service exports:<\/b><span style=\"font-weight: 400;\"> In 2023, India\u2019s ICT services exports, the second highest in the world, stood at USD 162 billion.\u00a0<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>AI projects:<\/b><span style=\"font-weight: 400;\"> India\u2019s contribution to GitHub for AI projects is the highest in the world, at 23%, followed by the US (14%).\u00a0<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Unicorns:<\/b><span style=\"font-weight: 400;\"> India has the third largest number of homegrown unicorns by country.<\/span><\/span><\/li>\n<\/ul>\n<\/th>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><\/div>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-152707\" src=\"https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/242-679391c1ba341.webp\" alt=\"Digital Economy\" width=\"799\" height=\"256\" srcset=\"https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/242-679391c1ba341.webp 1158w, https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/242-679391c1ba341-300x96.webp 300w, https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/242-679391c1ba341-1024x328.webp 1024w, https:\/\/pwonlyias.com\/stage\/wp-content\/uploads\/2025\/01\/242-679391c1ba341-768x246.webp 768w\" sizes=\"(max-width: 799px) 100vw, 799px\" \/><\/p>\n<h2><span style=\"font-size: 18pt;\"><b>Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>digital economy<\/b><span style=\"font-weight: 400;\"> refers to an economy that is primarily based on digital technologies, including the internet, digital platforms, and digital devices.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">It encompasses all <\/span><b>economic activities that use digital resources<\/b><span style=\"font-weight: 400;\"> for business operations, communication, transactions, and service delivery.\u00a0<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-size: 18pt;\"><b>Key components of the digital economy<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>E-commerce<\/b><span style=\"font-weight: 400;\">: The buying and selling of goods and services through digital platforms like websites and mobile apps <\/span><b>(e.g., Amazon, Flipkart).<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Digital Services<\/b><span style=\"font-weight: 400;\">: Online services such as cloud computing, digital payments, fintech solutions, and <\/span><b>software-as-a-service (SaaS) platforms.<\/b>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><b>SaaS is a software licensing model. <\/b><span style=\"font-weight: 400;\">It provides access to applications on a subscription basis through external servers. Ex.<\/span><b> Salesforce, Google Workspace apps, Microsoft 365<\/b><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Data<\/b><span style=\"font-weight: 400;\">: The collection, analysis, and use of data for decision-making, marketing, and enhancing customer experiences. Big data, AI, and machine learning are core parts of this aspect.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Digital Infrastructure<\/b><span style=\"font-weight: 400;\">: Technologies like<\/span><b> broadband internet, 5G networks<\/b><span style=\"font-weight: 400;\">, and data centers that support digital activities across industries.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Digital Innovation<\/b><span style=\"font-weight: 400;\">: The development of new technologies <\/span><b>(like artificial intelligence, blockchain, and the Internet of Things)<\/b><span style=\"font-weight: 400;\"> that transform industries and create new business opportunities.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: center;\"><span class=\"vc_button\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books\/upsc-textbooks?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+Textbooks\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Check Out UPSC NCERT Textbooks From PW Store<\/span><\/a><\/span><\/p>\n<div class=\"vc_table_green\"><\/p>\n<table style=\"width: 99.8996%;\">\n<tbody>\n<tr>\n<th style=\"width: 100%; border-style: solid; border-color: #000000; background-color: rgba(184, 165, 217, 0.53); text-align: left; vertical-align: middle;\">\n<h2><span style=\"font-size: 18pt; color: #000000;\"><b>Digital Public Infrastructure (DPI)<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">DPI refers to the digital platforms and systems that <\/span><b>enable the delivery of public services,<\/b><span style=\"font-weight: 400;\"> such as<\/span><b> identification, payments, health, education, and governance.<\/b><\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">It can be understood as an<\/span><b> intermediate layer in the digital ecosystem.\u00a0<\/b><\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">It sits atop a<\/span><b> physical layer (including connectivity, devices, servers, data centers, routers, etc.<\/b><span style=\"font-weight: 400;\">), and supports an <\/span><b>apps layer (information solutions to different verticals, e-commerce, cash transfers, remote education, telehealth, etc.).\u00a0<\/b><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">DPI can help solve global challenges such as <\/span><b>poverty reduction, climate resilience, and digital transformation <\/b><span style=\"font-weight: 400;\">by improving the efficiency, transparency, inclusion, and innovation of public service delivery.<\/span><\/span><\/li>\n<\/ul>\n<\/th>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><\/div>\n<h2><span style=\"font-size: 18pt;\"><b>Advantages of the Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Increased Productivity<\/b><span style=\"font-weight: 400;\">: Businesses can automate tasks, improving efficiency and reducing the time needed for operations.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">According to a McKinsey report, organisations that adopted AI and digital technologies experience productivity gains of <\/span><b>20-30%<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Reduced Costs<\/b><span style=\"font-weight: 400;\">: Cloud services and digital tools lower the need for expensive physical infrastructure, allowing businesses to adjust their size easily.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><b>Ecommerce platform Flipkart <\/b><span style=\"font-weight: 400;\">utilizes<\/span><b> Google Cloud t<\/b><span style=\"font-weight: 400;\">o handle its infrastructure, enabling it to manage high volumes of daily visits.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Wider Reach<\/b><span style=\"font-weight: 400;\">: Online platforms help businesses connect with global customers and expand their market.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Google processes <\/span><b>over 8.5 billion searches per day<\/b><span style=\"font-weight: 400;\">, and this data helps the company refine its services and targeted ads.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Better Data Access<\/b><span style=\"font-weight: 400;\">: Digital tools provide valuable data that can be analyzed to improve business strategies, customer understanding, and operations.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Examples: <\/span><b>Customer Relationship Management (CRM) Software <\/b><span style=\"font-weight: 400;\">(e.g., Salesforce, HubSpot)<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Convenience<\/b><span style=\"font-weight: 400;\">: Consumers can shop or access services online at any time and from anywhere, making life easier.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The market value of the <\/span><b>e<\/b><span style=\"font-weight: 400;\">&#8211;<\/span><b>commerce<\/b><span style=\"font-weight: 400;\"> industry in <\/span><b>India<\/b><span style=\"font-weight: 400;\"> was 123 <\/span><b>billion<\/b><span style=\"font-weight: 400;\"> US dollars in 2024. This number was estimated to <\/span><b>reach 300 billion<\/b><span style=\"font-weight: 400;\"> US dollars by 2030.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Improved Customer Experience<\/b><span style=\"font-weight: 400;\">: Businesses can offer quick customer service through digital channels like chatbots.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Personalization<\/b><span style=\"font-weight: 400;\">: Using data and AI, businesses can customize their products and marketing, enhancing customer satisfaction.<\/span><\/li>\n<\/ul>\n<div class=\"vc_table_green\"><\/p>\n<table style=\"width: 99.8996%;\">\n<tbody>\n<tr>\n<th style=\"width: 100%; border-style: solid; border-color: #000000; background-color: rgba(184, 165, 217, 0.53); text-align: left; vertical-align: middle;\">\n<h2><span style=\"font-size: 18pt; color: #000000;\"><b>Committees on Digital Payments<\/b><\/span><\/h2>\n<p><span style=\"color: #000000;\"><b>Ratan Watal Committee on Digital Payments (2016)<\/b><\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">It was set up to recommend measures for promoting digital payments in India.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">It recommended the creation of an independent payments regulator under RBI.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Proposed for<\/span><b> Aadhaar as the primary identification for KYC <\/b><span style=\"font-weight: 400;\">and allowing Aadhaar-based e-KYC.<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Changes in Payment and Settlements Act: <\/b><span style=\"font-weight: 400;\">Suggested amendments to include provisions on consumer protection, data security, and privacy.<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Interoperability:<\/b><span style=\"font-weight: 400;\"> Proposed facilitating i<\/span><b>nteroperability between banks and payment servic<\/b><span style=\"font-weight: 400;\">e providers via mobile number and Aadhaar.<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Digital Transaction Fund:<\/b><span style=\"font-weight: 400;\"> Suggested the creation of a fund to promote digital transactions.<\/span><\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>Government Payments: <\/b><span style=\"font-weight: 400;\">Recommended that all government payments be made digitally.<\/span><\/span><\/li>\n<\/ul>\n<p><span style=\"color: #000000;\"><b>Nandan Nilekani Panel on Digital Payments (2019)<\/b><\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Set up to evaluate and suggest improvements in India\u2019s digital payment systems.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Emphasized the government\u2019s role in promoting the digitization of payments.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400; color: #000000;\">Recommended that all government-to-citizen payments, including DBT transfers, be made digitally.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"color: #000000;\"><b>National Common Mobility Card (NCMC): <\/b><span style=\"font-weight: 400;\">Proposed the creation of a National Common Mobility Card, interoperable across transport modes and also functioning as an ATM debit card.<\/span><\/span><\/li>\n<\/ul>\n<\/th>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><\/div>\n<p style=\"text-align: center;\"><span class=\"vc_button\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books\/upsc-modules?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+Modules\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">Check Out UPSC Modules From PW Store<\/span><\/a><\/span><\/p>\n<h2><span style=\"font-size: 18pt;\"><b>Challenges to India&#8217;s Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li><b>Digital Divide:<\/b><span style=\"font-weight: 400;\"> As of 2024, a large portion of rural India remains disconnected, with women, children, and marginalized groups facing particular barriers.<\/span>\n<ul>\n<li><span style=\"font-weight: 400;\">India ranks <\/span><b>12th among G20 nations in terms of digitalization.<\/b><\/li>\n<\/ul>\n<\/li>\n<li><b>Cybersecurity Threats:\u00a0 <\/b><span style=\"font-weight: 400;\">With the rise in <\/span><b>digital transactions and cloud-based services,<\/b><span style=\"font-weight: 400;\"> India faces increasing risks of data breaches, hacking, and cyberattacks.<\/span>\n<ul>\n<li><span style=\"font-weight: 400;\">In 2024, a <\/span><b>massive data breach<\/b><span style=\"font-weight: 400;\"> occurred in the <\/span><b>Aadhaar database<\/b><span style=\"font-weight: 400;\">, the national identification system of India.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Regulatory and Policy Challenges: <\/b><span style=\"font-weight: 400;\">India&#8217;s digital economy is governed by a patchwork of evolving policies and regulations, making it difficult for businesses to navigate.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Except for the <\/span><b>Digital Personal Data Protection (DPDP) Act, the National Data Governance Framework Policy, the National Cyber Security Strategy,<\/b><span style=\"font-weight: 400;\"> and the <\/span><b>National E-Commerce Policy, DPDP Rules<\/b><span style=\"font-weight: 400;\"> are all currently in draft form.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Monopoly and Market Dominance:<\/b><span style=\"font-weight: 400;\"> India\u2019s digital ecosystem is dominated by <\/span><b>Amazon, Flipkart, Google, and Reliance Jio, <\/b><span style=\"font-weight: 400;\">which may stifle competition and lead to unfair trade practices.<\/span>\n<ul>\n<li><span style=\"font-weight: 400;\">As of 2024,<\/span><b> Jio has around 40% market share in India&#8217;s telecom industry,<\/b><span style=\"font-weight: 400;\"> similarly <\/span><b>Amazon holds about 30-35% of the ecommerce<\/b><span style=\"font-weight: 400;\"> market share in India.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Import Restrictions on IT Goods:<\/b><span style=\"font-weight: 400;\"> India\u2019s restrictions on the import of certain IT products, such as laptops and tablets, may hinder the entry of foreign technology firms.<\/span>\n<ul>\n<li><span style=\"font-weight: 400;\">India has the<\/span><b> highest average applied tariff of any G20 country, <\/b><span style=\"font-weight: 400;\">and some of the highest <\/span><b>bound tariff rates among WTO members.\u00a0<\/b><\/li>\n<\/ul>\n<\/li>\n<li><b>Infrastructure Constraints:<\/b><span style=\"font-weight: 400;\"> While 4G and 5G have expanded, India\u2019s fixed broadband infrastructure lags behind other G20 nations in terms of speed and reliability.<\/span><\/li>\n<li><b>Uncertain Future of Digital Services Taxation: <\/b><span style=\"font-weight: 400;\">The Digital Services Tax (DST) introduced by India has created a tax burden on foreign online advertising platforms and digital businesses, adding complexity for international companies.<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The <\/span><b>6% &#8220;equalization levy&#8221;<\/b><span style=\"font-weight: 400;\"> on foreign advertising platforms, which was introduced in 2017, adds to the compliance burden for foreign firms operating in India.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><span style=\"font-size: 18pt;\"><b>Way Forward<\/b><\/span><\/h2>\n<ul>\n<li><b>Bridging the Digital Divide<\/b><span style=\"font-weight: 400;\">: Strengthening <\/span><b>BharatNet, National Broadband Mission 2.0 <\/b><span style=\"font-weight: 400;\">and other rural connectivity programs.<\/span><\/li>\n<li><b>Enhancing Cybersecurity:<\/b><span style=\"font-weight: 400;\"> Implementing robust data protection laws like the <\/span><b>Digital Personal Data Protection Act, 2023<\/b><span style=\"font-weight: 400;\"> and<\/span><b> Digital Personal Data Protection Rules, 2025.<\/b><\/li>\n<li><b>Promoting Digital Literacy<\/b><span style=\"font-weight: 400;\">: Expanding programs like <\/span><b>PMGDISHA (Pradhan Mantri Gramin Digital Saksharta Abhiyan).<\/b><\/li>\n<li><b>Policy Reforms:<\/b><span style=\"font-weight: 400;\"> Establishing a cohesive <\/span><b>regulatory framework <\/b><span style=\"font-weight: 400;\">for digital platforms.<\/span><\/li>\n<li><b>Encouraging Localization:<\/b><span style=\"font-weight: 400;\"> Supporting the development of<\/span><b> indigenous digital platforms and technologies.<\/b><\/li>\n<li><b>Reducing Import Restrictions on IT Goods: <\/b><span style=\"font-weight: 400;\">Reevaluate import tariffs to encourage foreign technology firms to invest and expand in India.\u00a0<\/span><\/li>\n<\/ul>\n<p style=\"text-align: center;\"><span class=\"vc_button\"><a href=\"https:\/\/www.pw.live\/batches\/upsc\/pw-only-ias?utm_source=seo+upsc+batch&#038;utm_medium=seo+upsc&#038;utm_campaign=seo&#038;utm_id=upsc\" target=\"_blank\" rel=\"noopener\">Enroll now for UPSC Online Classes<\/a><\/span><\/p>\n<div class=\"vc_table_green\"><\/p>\n<table style=\"width: 99.7979%;\">\n<tbody>\n<tr>\n<th style=\"width: 100%; border-style: solid; border-color: #000000; background-color: rgba(184, 165, 217, 0.53); text-align: left; vertical-align: middle;\">\n<h2><span style=\"font-size: 18pt; color: #000000;\"><b>Government Initiatives to Boost Digital Economy<\/b><\/span><\/h2>\n<ul>\n<li><span style=\"color: #000000;\"><b>Digital India Programme (2015): <\/b><span style=\"font-weight: 400;\">Launched to transform India into a digitally empowered society and knowledge economy.<\/span><\/span>\n<ul>\n<li><span style=\"color: #000000;\"><b>Components:<\/b><\/span>\n<ul>\n<li><span style=\"color: #000000;\"><b>Broadband for All:<\/b><span style=\"font-weight: 400;\"> Expansion of broadband networks to rural areas.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Digital Infrastructure as a Utility:<\/b><span style=\"font-weight: 400;\"> Providing high-speed internet, digital storage, and delivery of services online.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Governance and Services on Demand:<\/b><span style=\"font-weight: 400;\"> Aiming for government services to be available electronically.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Digital Literacy:<\/b><span style=\"font-weight: 400;\"> Providing digital literacy to citizens, especially in rural areas.<\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n<li><span style=\"color: #000000;\"><b>Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA): <\/b><span style=\"font-weight: 400;\">To promote digital literacy in rural areas.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Aadhaar: <\/b><span style=\"font-weight: 400;\">Providing a unique identity to every resident in India through biometric and demographic data.<\/span><\/span>\n<ul>\n<li><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Helps in facilitating <\/span><b>e-KYC, direct benefit transfers (DBT<\/b><span style=\"font-weight: 400;\">), and more efficient delivery of services.<\/span><\/span><\/li>\n<\/ul>\n<\/li>\n<li><span style=\"color: #000000;\"><b>BharatNet:<\/b><span style=\"font-weight: 400;\"> Launched to provide broadband connectivity to over 2.5 lakh Gram Panchayats across India.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Unified Payments Interface (UPI):<\/b><span style=\"font-weight: 400;\"> Provides a seamless, instant, and interoperable payment system.<\/span><\/span>\n<ul>\n<li><span style=\"font-weight: 400; color: #000000;\">UPI has boosted digital transactions, enabling small and large-scale payments via mobile phones.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><span style=\"color: #000000;\"><b>DigiLocker: <\/b><span style=\"font-weight: 400;\">Allows individuals to access and share government-issued documents online, reducing paperwork.<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>Digital Rupee (Central Bank Digital Currency): <\/b><span style=\"font-weight: 400;\">The Reserve Bank of India is exploring the issuance of a central bank digital currency (CBDC).<\/span><\/span><\/li>\n<li><span style=\"color: #000000;\"><b>National Payment Corporation of India (NPCI): <\/b><span style=\"font-weight: 400;\">Statutory body tasked with the development and regulation of digital payments systems in India.<\/span><\/span>\n<ul>\n<li><span style=\"color: #000000;\"><span style=\"font-weight: 400;\">Key Achievements: <\/span><b>UPI, IMPS (Immediate Payment Service), RuPay cards<\/b><span style=\"font-weight: 400;\">, and <\/span><b>National Financial Switch (NFS).<\/b><\/span><\/li>\n<\/ul>\n<\/li>\n<li aria-level=\"1\"><span style=\"color: #000000;\"><b>Digital Personal Data Protection (DPDP) Act: <\/b><span style=\"font-weight: 400;\">Enacted to ensure robust data protection and privacy for citizens.<\/span><\/span><\/li>\n<\/ul>\n<\/th>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><\/div>\n<p><b><i>R<\/i><\/b><b><i>eady to boost your UPSC 2025 preparation?<\/i><\/b> <a href=\"https:\/\/www.pw.live\/batches\/upsc?utm_source=seo+upsc+batch&#038;utm_medium=seo+upsc&#038;utm_campaign=seo&#038;utm_id=upsc\" target=\"_blank\" rel=\"noopener\"><b><i>Join PW&#8217;s UPSC online courses<\/i><\/b><\/a><b><i> today!<\/i><\/b><\/p>\n<div class=\"vc_table_green\"><\/p>\n<table style=\"width: 99.6375%;\">\n<tbody>\n<tr>\n<td style=\"width: 111.19%; text-align: center;\" colspan=\"2\"><span style=\"font-size: 18pt;\"><b>Also Read<\/b><\/span><\/td>\n<\/tr>\n<tr>\n<td style=\"width: 49.797%; text-align: center;\"><a href=\"https:\/\/pwonlyias.com\/stage\/editorial-analysis\/\" target=\"_blank\" rel=\"noopener\"><b>UPSC Daily Editorials<\/b><\/a><\/td>\n<td style=\"width: 61.393%; text-align: center;\"><a href=\"https:\/\/pwonlyias.com\/stage\/daily-current-affairs\/\" target=\"_blank\" rel=\"noopener\"><b>UPSC Daily Current Affairs<\/b><\/a><\/td>\n<\/tr>\n<tr>\n<td style=\"width: 49.797%; text-align: center;\"><a href=\"https:\/\/pwonlyias.com\/stage\/quiz\/\" target=\"_blank\" rel=\"noopener\"><b>Daily Current Affairs Quiz<\/b><\/a><\/td>\n<td style=\"width: 61.393%; text-align: center;\"><a href=\"https:\/\/pwonlyias.com\/stage\/mains-answer-writing\/\" target=\"_blank\" rel=\"noopener\"><b>Daily Main Answer Writing<\/b><\/a><\/td>\n<\/tr>\n<tr>\n<td style=\"width: 49.797%; text-align: center;\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books\/upsc-previous-year-papers?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+Previous+Year+Papers\" target=\"_blank\" rel=\"noopener\"><b>Check Out Previous Years Papers From PW Store<\/b><\/a><\/td>\n<td style=\"width: 61.393%; text-align: center;\"><a href=\"https:\/\/pwonlyias.com\/stage\/upsc-test-series-courses\/\" target=\"_blank\" rel=\"noopener\"><b>UPSC Test Series<\/b><\/a><\/td>\n<\/tr>\n<tr>\n<td style=\"width: 49.797%; text-align: center;\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books\/upsc-textbooks?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+Textbooks\" target=\"_blank\" rel=\"noopener\"><b>Check Out UPSC NCERT Textbooks From PW Store<\/b><\/a><\/td>\n<td style=\"width: 61.393%; text-align: center;\"><a href=\"https:\/\/store.pw.live\/govt-entrance-exams\/upsc-books\/upsc-modules?utm_source=SEO&#038;utm_medium=PW+Live&#038;utm_campaign=UPSC+Modules\" target=\"_blank\" rel=\"noopener\"><b>Check Out UPSC Modules From PW Store<\/b><\/a><b>\u00a0<\/b><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>The Ministry of Electronics and Information Technology (MeitY) has released a comprehensive report titled \u2018Estimation and Measurement of India\u2019s Digital Economy.<\/p>\n","protected":false},"author":11,"featured_media":152712,"menu_order":0,"comment_status":"open","ping_status":"open","template":"","format":"standard","meta":{"rank_math_lock_modified_date":false,"footnotes":""},"tags":[],"paper-wise":[2089],"subject":[2100],"acf":[],"_links":{"self":[{"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/current-affairs\/152746"}],"collection":[{"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/current-affairs"}],"about":[{"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/types\/current-affairs"}],"author":[{"embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/comments?post=152746"}],"version-history":[{"count":2,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/current-affairs\/152746\/revisions"}],"predecessor-version":[{"id":152754,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/current-affairs\/152746\/revisions\/152754"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/media\/152712"}],"wp:attachment":[{"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/media?parent=152746"}],"wp:term":[{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/tags?post=152746"},{"taxonomy":"paper-wise","embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/paper-wise?post=152746"},{"taxonomy":"subject","embeddable":true,"href":"https:\/\/pwonlyias.com\/stage\/wp-json\/wp\/v2\/subject?post=152746"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}