Blog Post Year: 2018

This blog is part of a series on blockchain technology, governance and its implications for e-Governance in India. 

While presenting the Union Budget this year, Finance Minister Arun Jaitley made an important if not surprising mention on the government’s inclination to explore the potential of blockchain technology. The announcement in the Parliament, India’s highest policymaking echelon, is only one example in a string of high profile moves on blockchain. Various Indian states have begun integrating the technology in governance operations already.

Andhra Pradesh has emerged as a frontrunner in this respect. The government has invested considerable efforts in blockchain governance mechanisms in at least two key departments- management of land records and vehicle registrations. A first of its kind decision, the port city of Vishakapatnam is also being developed into a FinTech hub with blockchain at its core.

Much like Andhra Pradesh’s initiatives to understand the use cases in various government departments, Karnataka recently organised a hackathon on blockchain inviting practitioners and academics to deliberate real-life governance scenarios, and has announced a white paper too. Maharashtra and Telangana are among other states who are embracing the technology. A pilot project is planned on tamper proof land transaction data in Maharashtra while Telangana is using blockchain to eliminate fraudulent data in land records. The private sector’s role in innovating on each of these is of note.

While talks of blockchain revolutionising antiquated governance practices has swept policy circles; the technology is thought to offer some very concrete advantages. The experience of countries which have been successful at creating blockchain-enabled societies, such as Estonia, provide some insight into the change blockchain can usher. From secure voting to a more efficient judicial system, the technology has opened up new avenues for good governance for the country. Blockchain has facilitated ease of use, given people power over their information (which is not the case in India as it proposes centralised mechanisms for data access), and most importantly offered much-needed transparency in fundamental governance practices.

Thus, by minimising human intervention, the adoption of the technology is seen to be a step towards enabling service delivery that is truly accountable to the people.

Yet given blockchain’s potential as a disruptive technology as observed by Prime Minister Narendra Modi among others, one cannot help but wonder how India’s behemoth and complex bureaucratic system adapts to this change. If history is to serve as an example, e-Governance initiatives in Karnataka in the 1980s introduced new technologies (namely digitsation of records and regularisation of computer usage in day-to-day activities) but various issues of implementation emerged quickly. In a previous blog, we spoke of how early resource managers critical to implementation moved on while systems remained weak. Uptake for even simple e-Governance processes such as using spreadsheets for calculations prove markedly slow.

There are thus three critical questions to be considered now.

Is there a danger that blockchain technology is being overemphasised for good governance in India when allied implementation issues remain unresolved? Secondly, is adequate foresight being given to ramifications of this technology on a system-wide scale, and to what extent will the private sector play a role? Lastly, how will the changes play out for grassroots administrators and service delivery by them?

This blog is part of a series on blockchain technology, governance and its implications for e-Governance in India. 

I ended my last blog a fortnight back, asking whether Blockchain technology might provide a disruptive breakthrough in reforming governance processes. I had lamented that if most reform suggestions had to go back to the same people who benefit from the lack of transparency in the current system; they would not have any incentive to reform.

Yet, aspirations must be created, if they do not exist. e-Governance is as likely to get stuck in a low level equilibrium if not challenged. So challenge it, we must.

The best way to prove that something can be done, is to find somewhere where it’s done. And that’s where Estonia comes into the picture.

The Baltic nations- tiny Estonia, Lithuania and Latvia- have always had the Russian bear at their doorsteps. For them, defence is an urgent national priority. But defence could cost a great deal for a small country. Since an army might not provide enough deterrence to a large aggressor, so defence by a larger strategic alliance becomes a necessary option. In the case of Estonia, defence cover is provided by the NATO, and the country pays through its nose for it.

All the more reason that the country has to tighten its belt and maximise its efficiency. What better way to do that, than reduce its bureaucracy? On the face of it, streamlining the bureaucracy is no big deal. Countries speak of it all the time – indeed, the same bureaucracy that does not wish to be streamlined, leads the way in streamlining itself. What makes Estonia different is the staggering scale of its vision, as also the steps it has taken to achieve its vision. There are some key principles that emerge from the Estonian experience.

• • First, e-Estonia, sets its sights high. It is not merely about going through a shopping list of disconnected processes and simplifying them; the vision of the government is to transform itself from a state to a digital society. In this regard, it touches everything that has to do with citizens’ lives and in direction, the distinction between the public and the private sectors has disappeared.

• • Second, keeping in mind its ambition vision, e-Estonia has discarded the conventional approach of e-Governance in departmental silo. Instead, it aims to integrate all services with which the government is involved, under one seamless platform. This transcends service delivery to include legislation, voting, justice, banking, policing and taxation, apart from the delivery of public welfare services such as education and health.

• • Third, at the citizen level, the core assurance of the system is the ‘once only’ policy, which lays down that no information should be entered twice. Thus, at the citizen level once basic data is entered once, then there is no need to ‘prepare’ data for individual transactions with the government. No applications for loans, passports, certificates, licences need be written up all over again, because data for these can be automatically pulled from various places in the system. This means that only the barest minimum of transactions will need physical presence. Thus, if Estonians want to marry and register their marriages, they will need to turn up at the marriage registrar. Similarly, if they want to sell properties, they will need to turn up at the property registry office. Nearly all other bureaucratic processes can be done online, including voting, which can be done from the citizens’ laptops.

• Fourth, while it is inevitable that the system rests on a foundation of personal data of citizens, the state does not own this data. The state cannot manipulate and use this data without the consent of the citizens concerned. Citizens themselves have a two-step access code to look over their data. They have to insert their ID cards into their laptops, and type in their two secret codes, one of which issues their digital signature. This unlocks access to the personal data stored on the population registry of the state. Different boxes contain employment and property information, traffic records, health, education and even pet ownership records. Best of all this data is not centrally held, but is distributed across encrypted pathways. It is the individual concerned that has access to the rigorous filtering of who can access what. Thus, if you were in Estonia, you could at your option, disallow your heart doctor from checking what your dentist has to say. And to seal the security, every time anybody peeps into one’s records, that is recorded and reported. Electronic peeping; checking out someone’s data for no reason, is a criminal offence.

These principles may give the impression that Estonia is non transparent to the extreme. What use is big data capability, if citizens can block access to nearly all data relating to themselves, in a capricious manner? Yet, Estonia is hugely transparent in many other ways.

More of that, in my next blog.

इस ब्लॉग का हिंदी में सारांश आपको यहाँ मिलेगा|