IMF hails India’s digital transformation, asks other countries to learn from it


India’s development of a “world-class digital public infrastructure” serves as a model for other nations undergoing digital transformation, according to a working paper by the International Monetary Fund (IMF). The paper, titled ‘Stacking up the Benefits Lessons from India’s Digital Journey,’ credits India’s building block approach and focus on supporting innovation for the success of its digital public infrastructure (DPI).

The building block approach involves identifying a minimal common core to solve a set of problems. For a diverse country like India, this approach provides basic tools for creating tailored solutions. 

The paper emphasises the need for interoperability between different DPIs and competition-focused design to support a vibrant ecosystem. India’s interoperability is supported through open standards, allowing anyone to use India Stack’s functionality.

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The paper notes that India’s principles have been applied to other DPIs in education and health, including the COVID-19 vaccine distribution platform, CoWIN. Using a digital backbone allowed India to scale its vaccine delivery quickly and overcome challenges such as large-scale internal migration. 

CoWIN’s technology has also been deployed in Indonesia, the Philippines, Sri Lanka, and Jamaica to facilitate their vaccination programs.

India’s recognition of the importance of Information Technology (IT) in developing the identity layer is also highlighted. Before the Aadhaar card, India had various identity cards and databases, but none had universal coverage or the ability to handle a billion-plus citizens. 

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To design such an identity system, the government appointed a successful IT entrepreneur as its founding chairman and enabled UIDAI to hire more relevant talent for the task.

The paper emphasizes that India’s digital building block approach fosters innovation, allowing each building block to address multiple problems. India’s focus on supporting a vibrant ecosystem allows for interoperability, fosters competition, and provides the opportunity to tailor solutions to the local context. 

The design of India Stack encourages competition and removes silos, sidestepping existing bottlenecks and incumbent interests.

Luis E Breuer, IMF Senior Resident Representative to India, praised India’s digital public infrastructure in a tweet, stating that it is transforming people’s lives. The paper concludes that India’s journey offers lessons for other nations undergoing digital transformation.

(With ANI inputs)

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