In News: Addressing the meeting of the BRICS Business Forum, Prime Minister said the digital transformation unfolding in India has never before been seen on the world stage
India’s digital economy and the infrastructure sector has a total potential for $2.5 trillion
There are more than 100 unicorns in over 70,000 start-ups in India, and their number continues to grow.
The value of the Indian digital economy will reach $1 trillion by2025
Advantages of a Digital Economy
Removal of Black Economy: By restricting cash-based transactions and using only digital payments, the government can efficiently expel the black economy.
Empowerment to People: Direct Benefit Transfer, fight against Corruption
Creation of new jobs
Increase in Revenues: Each transaction is recorded, customers will get a bill for their purchase, and the merchants are bound to pay sales tax to the government.
e-governance: Digital economy will pave a way to e-governance, where delivery of all government services would be done electronically
Measures taken by Government
Digilockers: it is a “digital locker” service operated by the Government of India that enables Indian citizens to store certain official documents on the cloud.
Digital Payments: The introduction of Unified Payments Interface (UPI), which introduced the benefits of digital payments in every part of the country.
BHIM app—It is an app to enable digital payments.
Pradhan Mantri Gramin Digital Saksharta Abhiyan to make citizen digitally literate.
BharatNet Project: world’s largest rural broadband connectivity programme using Optical fibre
Challenges
Lack of connectivity/infrastructure: Slow roll-out of Wi-Fi hotspots and the slow speed
Lack of incentives: Most small and medium scale industry is struggling to adapt to modern technology
Digital illiteracy: Huge digital divide between gender, regions etc
Lack of skilled manpower: Lack of user education and there are limited facilities to train personnel
Way forward
India’s technical and management institutes should revamp their curriculum to integrate and promote digital technologies
Skill development initiatives to train manpower
Stricter data protection laws that govern such cross border digital flows is needed he digital economy is heavily based on intellectual property, strict protection to patents and copyrighted work, whether produced in India or elsewhere is also need to be implemented.
BRICS summit
The BRICS summit is being hosted by China as a chair of BRICS this year
BRICS
BRICS is an acronym for the grouping of the world’s leading emerging economies, namely Brazil, Russia, India, China and South Africa.
The BRICS Leaders’ Summit is convened annually.
The Chairmanship of the forum is rotated annually among the members, in accordance with the acronym B-R-I-C-S
Together, BRICS accounts for about 40% of the world’s population and about 30% of the GDP
The firstBRIC Summit took place in 2009 in the Russian Federation
South Africa was invited to join BRIC in December 2010, after which the group adopted the acronym BRICS.
South Africa subsequently attended the Third BRICS Summit in Sanya, China, in March 2011.
BRICS initiatives
New Development Bank
During the Sixth BRICS Summit in Fortaleza (2014) the leaders signed the Agreement establishing the New Development Bank (NDB).
Fortaleza Declaration stressed that the NDB will strengthen cooperation among BRICS and will supplement the efforts of multilateral and regional financial institutions for global development thus contributing to sustainable and balanced growth.
NDB is headquartered in Shanghai.
Contingent Reserve Arrangement
Considering the increasing instances of global financial crisis, BRICS nations signed BRICS Contingent Reserve Arrangement (CRA) in 2014 as part of Fortaleza Declaration at Sixth BRICS summit.
The BRICS CRA aims to provide short-term liquidity support to the members through currency swaps to help mitigating BOP crisis situation and further strengthen financial stability.
