The recent bullish trend of US tech companies towards India, particularly the massive FDI inflows in the telecommunication sector, predicts a bright digital future for the country.
The Indian digital odyssey began with the Indian Stack or the Adhaar Initiative - a central digital depository of identities, e-payments, electronic Know Your Customer verification, eSign for the safe transfer of health and financial documents. This India Stack enables 1.3 billion people to access banking, finance and healthcare. Combine this with India's burgeoning smartphone market and you have a country going from taking its first tentative step to running full tilt into the digital age. The Covid-19 pandemic has only sped this digital evolution up.
Today, Working From Home (WFH) and e-schooling or e-learning are common concepts in India. It's also not uncommon to see teenagers in rural India busy playing video games on their mobile phones. Indian farmers are slowly making the move towards tech, not just in terms of replacing traditional ploughing and harvesting methods with machines, but also using AI and other digital tech to understand crop cycles and weather patterns.
India's digital age has brought with it tremendous opportunities. Indian SMEs now have access to a global market, levelling the playing field for these businesses. Not to mention that 1.3 billion Indians now have access to digital tech in finance and banking. According to the World Investment Report by UNCTAD, the FDI inflow into India rose 13 per cent on year in FY20 to a record $49.97 billion compared to $44.36 billion in 2018-19, with investors concluding deals worth over $650 million in the first quarter of 2020, mostly in the digital sector. Credit Suisse recently revealed that the digital transactions in India are expected to rise fourfold, to $1 trillion, by 2023. The epiphany is not lost on big tech.
Digital tech giants such as Google, Facebook, Microsoft, Amazon and Walmart are all eagerly participating in writing the next chapter to the great Indian tech odyssey. This is just the beginning. An article by the Wall Street Journal suggests that currently only half of India's population is online, which leaves these companies a fairly chunky market segment to expand into. And just so we don't lose sight of scale here - that's a market size of 650 million.
So how can India use tech to supercharge its economy If the role played by digital tech to counter the disruption caused by the Covid-19 pandemic is anything to go by, then digital is definitely the way forward. The new normal today is very much tech centric, whether it is WFH, buying groceries and essentials online, paying bills, or simply Netflix-ing to chill. The pandemic, and the consequent digital boom in India, has also seen Indian SME's coming of age. In a recent blog post, Sundar Pichai noted that the global pandemic has supercharged digital adoption in India, noting that the digitisation of MSME's is a particularly exciting trend to keep track off. “Just four years ago, only one-third of all small businesses in India had an online presence. Today, 26 million SMBs are discoverable on Search and Maps, driving connections with more than 150 million users every month.”
A similar sentiment was recently echoed in the Emerging Technologies Forum at India Global Week 2020. The forum, which saw participation from Softbank, Infosys, Merian Ventures and Ola, explored how emerging global technologies and trends are being adopted in India.
Brij Nath, Chief Technology Officer, Ola, was convinced that “The private sector has to play an important role when it comes to the application of technology.”
Munish Verma, Managing Partner, SoftBank Investment Advisers, believes that “AI will have significant benefits going forward especially when it comes to job search, job creation, medicine development.” While Verma championed new and emerging tech he also stressed the importance of not reinventing the wheel just for the sake of innovation. “It′s also important that we focus on how we can use existing tech today and apply this in an Indian context so it benefits businesses and investors.”
There is no denying that the ongoing coronavirus pandemic has had, and continues to have, a profound impact on technology. Our struggle to protect not just lives but also livelihoods is increasingly dependant on developing various aspects of technology from digital data to quantum computing to genetic research - it's all tech-based.
As Anand Verma, CEO, Brilliant Basics (an Infosys company), observed, “It's become more prominent now to move from bytes to q bytes.” Adding that “quantum computing is becoming more important with Covid-19 and the search for a vaccine.” Priya Guha, Venture Partner, median Ventures, also stressed on the importance of technology stating that while “technology is the key to post-Covid economic recovery, it needs to be based on data.” Guha also stressed that “It′s important that the data input into the technology is relevant to the population it seeks to help,” ie it should be geared towards the Indian market and Indian database. This is where the Indian stacks once again play a pivotal role.
And even as India rides one digital wave after another, the future of tech will depend very much on a strong digital foundation. How India develops its basic digital infrastructure, whether it be wifi, connectivity, cyber security or tightening up data and privacy laws, will, therefore, play a pivotal role in tech adoption and acceleration in the country.
As both Anand Verma and Munish Verma observed during the Emerging Technologies Forum: “It′s also about how India leverages the trifecta of government, corporates and start-ups to achieve this."