The Indian Government & Technology [Recap 2012]

In India Online by NextBigWhat

In 2012, India became the second largest telecom network after China with 937.7 million telephone connections. At the end of September last year, India’s tele density was 77 %. With over 120 million users, its one of the largest Internet markets in the world poised for steady growth. The Internet is expected to contribute $100 billion to India’s GDP by 2015. Last year, the government announced some grandiose plans, botched up the spectrum auction and took a lot of flak on the Internet. Here’s a quick recap.BigBrother-YourCountryNeedsYou_thumb.jpg

For the Indian government, the previous year was perhaps the worst year online. It was at the receiving end of fierce criticism for various Internet related issues ranging from its clumsy response to the north east exodus, the overreaching section 66 of the Information Technology act which was misused to make arrests of people who made comments on social networks to the government’s initial stand on the United Nations Treaty to govern the Internet. Its proposed inter ministerial panel to handle Internet related issues and moves to monitor the Internet has also been criticized.

Many government websites were hacked and protesters also took to the street against government’s move to police the Internet. The Anonymous hacking group took down several government websites like that of the state run telco Bharat Sanchar Nigam Limited (BSNL) and also websites of ruling congress party members like Kapil Sibal.

In its finance bill of 2012, the Indian government also proposed taxes on startup investments as part of the general anti avoidance rules (GAAR). The government said that investments made by offshore entities in Indian companies would be treated as income and be taxed. The proposal was deferred by a year after much hue and cry.

In a seeping policy reform in the second half of the year, the government approved 51 % foreign direct investment (FDI) in retail but has not yet approved FDI in e-commerce which means companies like Amazon will have to wait before retailing in India.

India’s $35 tablets didn’t receive a very warm welcome when its second edition was finally launched in November. After much trouble with Datawind, the tablet maker which one the contract to make millions of low cost tablets, the government is now making a third version.

Much of the core technology behind Aadhaar, the project which aims at giving an  online identification to every Indian was put in place. The government has now started direct cash transfer of subsidies to beneficiary accounts using the Aadhaar platform. (Read what happened to Aadhaar last year)

Besides the ones we covered above, here’s a look at policy changes which will impact the tech scene in India.

National Telecom Policy Approved

The policy first mooted in 2010 was approved in May. Through the policy, the Government wants to create a corpus to promote indigenous research and development, creation of intellectual property, entrepreneurship and commercialisation of telecom services and products. The idea is to meet demand of Indian telecom sector by 60 % & 80 % with a minimum value addition by 2017 and 2020.

Auction of Spectrum

Auction of the 1800MHz band that started in November got over with five companies bidding for airwaves. The government received bids worth Rs 9,407 crore, much lower than the anticipated Rs 28,000 crore from five companies including Airtel, Idea and Vodafone. Some spectrum remained unsold.

National Optical Fiber Network

The government began pilot projects to provide villages with 100 Mbps broadband. The  fiber network is being tested in three villages in Rajasthan, Tripura and Andhra Pradesh respectively. By October, nearly 58 panchayats had 100 Mbps bandwidth, says the Government.

Universal Service Obligation Fund

Using this fund, the government installed public telephones in villages and said that nearly 5.8 lakh villages were covered with telephones. It also commissioned 14 mn new mobile towers and a couple of hundred base stations  in rural areas. So far, over 7,000 towers have been set up. About Rs 330 crore has been spent in 2012 until October out of the total Rs 47,035 crores collected from telecom operators.

National Policy on Electronics

By 2020, India’s domestic demand for electronics products and systems will be $400 billion as against a domestic production of $100 billion. To bridge the gap, the government came up with this policy. It has plans to set up electronics manufacturing clusters, a special incentive package and to set up semiconductor wafer fabrication units. It also gives preferential market access to domestic goods.

National Policy on Information Technology

The policy approved in September wants to create an additional 10 million jobs by 2020. It is also trying to make at least one in every household e-literate. The other intention is to create 3000 PhDs every year in specialised areas by 2020.

National Policy on Skill Development

This one wants to skill 500 million people by 2022 out of which 10 million people will be skilled in Information Communications and Technology. Government claims that in 2011-12, 2.25 lakh people were trained by NIELIT and CDAC.

Social Media and Citizen Engagement Framework

The government came out with a social media framework for departments to talk to citizen. The framework was notified in September 2012.

National Supercomputing Mission

The national mission on supercomputing proposes to take an application centric approach for future HPC activities in the nation. An initiative to upgrade the computing power of the current PARAM Yuva system installed at C-DAC, Pune from 54 Teraflop to 500 Teraflop has been undertaken.

[This article is part of our 2012 Recap series, and is supported by CCAvenue.]

2012 Recap/ 2013 Trends
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