Month: April 2017

Telcos should train their sights on the application for data

18 April, 2017, Economic Times

Original link is here

Long at the margins of the telecom and internet revolutions, India is today moving towards pole position on data consumption. The recently released Boston Consulting Group-The Indus Entrepreneurs (BCG-TiE) report on India’s internet economy suggests the country is the ‘second highest’ in terms of mobile internet adoption, clocking at 391 million users.

India’s digital economy is expected to double its value to $250 billion, and contribute to 7.5% of the GDP in three years. The projected data consumption per average user: 7-10 GB a month by 2020. Contrast this to the findings of the 2016 Ericsson Mobility Report that suggested data usage in India is slated to increase five-fold by 2021, rising to 1.4 GB per active smartphone. The five to seven times difference in projected data consumption between the 2016 Ericsson and the 2017 BCG-TiE one can be attributed to a disruptive intervention and a data-hungry consumer.

Jio, Reliance Industries Ltd’s technology startup, provided that disruptive intervention. It is perhaps the most influential driver behind the new numbers, which are, however, only the tip of the iceberg. There are deeper transformations that await the digital sector.

Three such transformations will prompt traditional telecom companies to compete and create new revenue streams that can’t rely on connectivity alone:

* The Death of Voice: Telecom companies should acknowledge the reality that traditional voice-based communication is now a market utility, not a luxury. ‘Voice-based’ communication companies will be pressed to invest in new infrastructure and ecosystems that meet the demand for videos and data-driven apps.

In practice, this means investing in infrastructure, and a new cadre of experts who can not only build platforms but respond agilely to disruptive innovation. Unless they can create this new technology ecosystem, they will perish.

* An Internet of People: Unprecedented data connectivity in the hands of half-a-billion (and growing) Indians will create an ‘Internet of People’, with each user signifying multiple opportunities to generate value for the platform economy. GoI’s flagship Digital India programme is, perhaps, the biggest public sector effort in the world to create such an ecosystem.

The ‘Internet of People’, in turn, gives rise to a major challenge: will the innovations for Indians be created and hosted in India? Or will the biggest platforms all be based abroad, leaving little room for the Indian platform economy to grow? As custodians of data, Indian businesses should build capacities for Big Data analytics, create tailored services and products for local consumers in local languages and, in the process, generate employment, unleash entrepreneurial spirits, and catalyse technology-driven social transformation. So, the individual is the biggest driver of India’s platform economy.

Policies for the Platform Economy: As India moves to a $10 trillion GDP by the early 2030s, the fuel of choice will be ‘bits and bytes’. If data is indeed the new oil, how is India prepared to secure this valued commodity? Regulatory questions around cyber security and data protection, as these relate to civilian networks in India, remain woefully unaddressed.

Policy debates in this space have been ‘principle-heavy’, seeking a golden median for regulation — say, for encryption or net neutrality — that can be emulated nationally. Instead, digital economy regulation should be ‘function-heavy’, prescribing rules of conduct for businesses and governments based on the end uses that data is deployed for.

The three-way contract between the user, service provider and app provider will determine questions like: who shares access to data? Can service providers innovate as nimbly as small startups providing applications on their platforms? How should applications be priced? And should this be reflected in data tariffs?

Jio is only one example of the disruption that is set to reverberate across the digital sector in India. That a company like Reliance can bring its considerable resources to bear on a digital enterprise definitely sets Jio apart from others. But the reality is that its digital infrastructure will generate little to no value for Jio, its nearest competitor or the next entrant into this sector. Innovation at the top, at the level of the platform, will expand the digital economy pie in India.

Already, Jio has emerged as a big contributor to Facebook’s latest quarterly revenues from Asia. How can Indian platforms avail the same benefits? It is crucial that India’s businesses, entrepreneurs and regulators train their sights on the application of data, rather than the tubes that deliver them to consumers.

The writer is vice-president, Observer Research Foundation. He has worked with Reliance Industries Ltd since 1994

 

Currents of disruption: Not just a new world order, but a new world

the interpreter, 7th April, 2017

Original link is  here

It has become a cliché to contend that the first half of the 21st century is different from the second half of the 20th, or that the 20 years after the end of the Cold War are no guide to the two decades that lie ahead of us. While past experiences are somewhat comparable, distinctly different contexts diminish their utility as tools for navigation. As such, how does one respond to what is unfolding at the cusp of the 2020s and what exactly are the markers of change in the international system that should define responses, solutions and statecraft?

It is possible to see this change in narrow and symbolic terms, say by re-configuration of the UN Security Council or by accepting the arrival of Asian candidates to the upper echelons of the Bretton Woods institutions. Other emblems of change would be the entry of India into an expanded Group of Seven as the eighth liberal democracy in that club of industrial economies, or new ocean politics resulting from the growing capacity of Chinese and to a lesser degree Indian naval power in an Indo-Pacific system hitherto underwritten by American maritime dominance.

Several such examples can be given and speculated upon. While some may well be realised and have a compounding impact on politics and society, these would still amount to narrow tactical shifts and to the reimagining of existing frameworks to incorporate rising powers. They would not, by themselves, be considered a clean-sheet redesign of the global order or sufficiently grasp the currents of disruption that lie just below the surface.

The challenges are tectonic and technological. When and if they are spent, they will leave us with not merely a new world order but a new world, the order for which is beyond the realms of current-day perception.

It would be safe to say that the next decade is likely to see the death of many institutions and arrangements that have hitherto been considered central to managing global affairs. At what stage will we begin to shape successor arrangements? And will these retain the agency of the state, or dissipate the powers of governance to big corporations, non-monolithic cultures and an individual’s sense of moral conduct?

Sweeping change, induced mostly by technology, will not just pose questions for the institutional matrices of the early 21st century, but also test the relevance of the very hierarchies of international relations of the past half-century. There is a fundamental mismatch between institutional arrangements currently in place to manage crises or ‘keep the peace’ and the disruptive tendencies that do not respect the state’s seal of sovereignty.

Four such disruptive developments are worth noting. The first and most salient concerns the very nature of power. The neat correlation of a big economy with big power that bears big responsibilities is under severe scrutiny. In the post-war epoch and in the period after the Cold War, the world’s largest economies were also its ultimate security guarantors. This was, for instance, the logic for creating the permanent membership of the Security Council in 1945. In turn, it was the big powers and, after 1990, the lone superpower that incubated the multilateral order and institutions that constituted the sinews of international cooperation, commerce and well-being.

The un-Enlightenment

The roots of this sense of occidental responsibility go deeper than merely the twin world wars of the 20th century. They can be located in the Eurocentric construct that flowed out of the Enlightenment, an 18th century phenomenon that revolutionised Western civilisation but had mixed consequences for the rest of the planet. It promoted both worldwide commerce and colonialism, leaving its imprint on the hierarchy of 20th and early 21st century geopolitics.

The ensuing sense of obligation – almost a noblesse oblige on a global scale – led to great powers and large economies playing an interventionist role in distant societies and informing developmental assistance in the manner of an intercontinental social responsibility charter. They took on global developmental leadership and were the largest contributors to the international provision of public goods, thereby defining the ethic of great-power behaviour.

The emerging powers of the early 21st century are different. For one, they have smaller capacities and political appetites. The economic and domestic political capital of a great power with a per capita income of US$40,000 is just not replicable by an emerging power with a per capita income of US$10,000. The latter faces enormous inequities and developmental gaps at home, and its generosity will perforce be constricted by domestic exigencies. Further, populist politics will make it harder for any power – old or emerging – to be an unremitting provider of global public goods.

Moreover, one of the new powers, China, is neither evangelical or expeditionary but transactional. China does not have a political model and an ideological or civilisational template to export or scale up. China is also culturally comfortable with shades of grey; the Anglo-Saxon quest for absolute, determinist clarity does not obsess Beijing.

China can live with long-term disorder. It can sublimate the moral inconsistency of being authoritarian at home and liberal abroad; or protectionist at home but seeking an open global trading system. Representing a society that is itself in transition, Beijing does not consider itself as default global peace-keeper or net security provider in the manner in which the expression has so long been understood.

Thus, India’s role as the liberal democracy with the fastest-rising contribution to global developmental assistance, as well as a net security provider in the coming decades, will be crucial. Along with Japan, it is the only exemplar of democratic and transparent traditions among the major powers of Asia. In years to come it is more likely to act in a manner that approximates the international obligations of actors such as the US. Yet it cannot do it alone, and its capacities are limited. The liberal world, including traditional powers that now increasingly looking inward, must guard against their efforts being crowded out by large, targeted and self-serving assistance from non-democratic political traditions to the north of India.

Public goods, private provision

The second development concerns the supply of public goods by large transnational corporations. This is not the first time the private sector has assisted in ‘development’, but the current scenario is unlike any other moment in history. As a result of both technology and the diminution of resources available to governments and public institutions, the early 21st century is seeing a creeping capture of the provision of public goods and services by business corporations and large transnational philanthropic entities.

The developing world’s public health agenda, for example, is being influenced by a Bill and Melinda Gates Foundation, in some cases to a greater degree than by the World Health Organisation. The Trump Administration’s resolve to cut US funding for development programs that make allowance for abortion is being supplanted by large American charities and philanthropic institutions that see the right to choose as central to women’s health and empowerment. Such processes will curb the autonomy – and in some cases the excesses – of the state and of national governments seeking to achieve politically desirable goals.

The purpose here is not to make a value judgement; it is only to stress that the power landscape has become that much more diffused.

In the economic sphere too the concept of public goods and private provision – and of where the state, as the traditional provider of public goods, comes into this dynamic – has to be considered afresh. In most societies the internet and data services comprise a public utility being delivered by private corporations. Tesla and Uber (and Ola in India) are current and future providers of public transport networks without which cities will be unable to do business. But they are also networks over which the government – or even traditional political pressure groups such as trade unions – have only nominal control.

Even so, when there are interruptions to data services or public transport or changes to the nature of jobs and labour markets following disruptions by, for instance, app-based intermediation, aggregation and similar technologies, the state will still remain answerable to its citizen.

Large industrial businesses and shared-economy behemoths are conscious of their impact on both markets and communities. That is why suggestions of an income tax to be paid by robots have come from the founder of Microsoft, or why the chief executive of Tesla has urged governments to institute a universal basic income. The devolution of a ‘public goods provider’ role has in turn generated thinking on quasi-government obligations among futuristic corporations.

In the next 20-odd years, as creation of value and haemorrhaging of jobs carry on in parallel, as wealth generation and concerns over access to the essentials of life occur simultaneously, the 20th century thrust towards inequity mitigation will be subsumed by one centred on inequity management. Conflicts of countries will take second place to conflicts of interests, both between and more so within societies and nation states. How will the international system address these conundrums?

Ghost in the machine

The third development is the uneasy but imminent transition in industrial production from human-intensive to machine-driven ecosystems. The early 21st century is the age of the Fourth Industrial Revolution. For a world still coming to grips with the Third Industrial Revolution and the digital possibilities it continues to throw up, the dramatic change in the lifetime of a single human generation cannot even be fathomed.

In a sense we are all guessing, some intelligently and some wildly. This is the period that will see the maturing and possible commodification of a menu of new technologies – artificial intelligence and robotics, 3D manufacturing and custom-made biological and pharmaceutical products, lethal autonomous weapons and driverless cars.

Take an example. The moral question of how a driverless car will decide between hitting a jaywalker and swerving and damaging the car has often been debated. The answer is both simple – save the human life – and complex: the modalities of saving that life will have social, economic and technological imperatives and implications. At which angle should the car swerve? Just enough to save the jaywalker or more than enough to save the jaywalker and maintain even more distance between car and human? That extra distance swerved will have costs. It could mean collision with an object such as an electric pole, a water hydrant, or a data distribution point. Who decides on what the driverless car must do and the angle at which it should swerve?

If the driverless car is in Dublin, is the decision taken by the Irish government, the car’s original code writers in California or a software programmer in Hyderabad to whom maintenance is outsourced? Which jurisdiction’s laws, regulations and normative principles will prevail? If different national jurisdictions have different regulations and fine print on something that should be so apparent – prioritising a human life – how will it affect insurance and investment decisions, including transnational ones, in relation to infrastructure that lies within damage-causing distance of a driverless car while it is attempting to evade a jaywalker?

It is inevitable and entirely realistic that the sociology and economy of the machine will determine a specialised discipline in 21st century diplomacy and trade negotiations. Already the large cyber-attack has displaced the nuclear-tipped missile as the proximate threat. This is, however, only the beginning as the human-machine equation is interrogated, and as predatory machines take jobs, rights and ultimately agency from humans.

It is also worth pondering whether automation will free up human resources for political violence. Automation and the widespread use of machines, it is believed, will enhance productivity, but the linear assumption that human beings will use their free time for ‘good’ is historically inaccurate. Industrial revolutions have brought with them great conflict. Just as technology will drive the creation of norms, it may also deepen old fault lines between states (and often within states, thought that is another debate).

Old Westphalia, new social contract

Finally, the role of the state itself requires re-examination. Technology is blurring national boundaries just at the time politics is defining them rigidly. Innovation and capital have impinged upon the domain of the state at a juncture when statism, nativism, identity and nationalism are in the midst of a comeback. They have emerged at their strongest after a quarter-century of being pushed to the margins by globalisation and its attendant forces.

Of all the major international covenants and formational paradigms, the Treaty of Westphalia (1648) has proved the most resilient. At 270 years, it is much older than the UN or the Nuclear Non-Proliferation Treaty or the World Trade Organisation. Even so, it salience and the essential persuasiveness of its conflation of territoriality, ethnicity and religion continues to keep a significant proportion of global public opinion engaged.

Having said that, the early 21st century will entail an updating of the Westphalian charter and the state’s mandate. A new social contract between state and citizen is upon us; the old binary of left and right, of a socialist state and a liberal government, no longer holds. While democratic instincts have sharpened in the infancy of the 21st century, with technology, including social media, as a force multiplier, so have the average household’s economic and income anxieties. As such, while government is expected to intervene as a pillar of economic reassurance, there is a trenchant reaction to any state attempt to tailor cultural choices, undermine privacy or intrude into the home of the citizen.

This duality, where the government is acknowledged to have an economic role but where the state is expected to be almost libertarian when it comes to social freedoms (for natives and citizens at least), has no 20th century precedent. It calls on the state to be the guarantor of security and delivery, even if the state is not entirely responsible for delivery of public goods and services, and even if those public goods and services, not to speak of security threats to them, originate an ocean away, in the jurisdiction of an alien state.

The nation-state will remain the fundamental unit of reckoning in the international system, but it will have to reckon, almost Brownian-motion-like, with other units and stakeholders in a fluid medium where disorder may have both permanence and legitimacy. It will also have to adapt to the truism that technology creates its own normative landscape and its own morality, and that this is the epoch of not just unprecedented production of technology but the almost monopolistic production of that technology by private and transnational corporations. Whether the state will be relegated to a secondary player on developmental concerns is an open question, but global governance institutions must be flexible enough to accommodate new and rising actors, state and non-state.

In particular, these institutions must tackle the problem of technology-driven determinism. Whether it is a Universal Basic Income or ‘Robot Tax’, social programs being promoted by the Silicon Valley’s capitalist class script a new narrative of man, machine, and provision of pubic goods. These schemes are no longer beholden to the social contract between the state and citizen, and they provide no alternative to their unquestioned belief that technology will improve living standards across the board. Global governance institutions, tempered by political realities as well as a rich history of successful and failed experiments at sustainable development, can intervene and lend new purpose to the provision of public goods by private actors.

Epilogue/Prologue

In March 2017, the finance ministers of the G20 countries met in Germany and were compelled to upgrade their 20th century hardware with a contemporary operating system. The G20, for the first time in the decade of the institution’s existence, acquiesced to the American call to drop promotion of free trade from its agenda. This was a marked shift for a collective with the explicit aim of rescuing and restating the imperatives of globalisation. Not for a long time, and not since the fall of the Soviet Union certainly, has the international system legitimised the divorce of domestic growth and prosperity from global commerce and economic integration.

In one telling moment, old and new notions of the Westphalian architecture, of the unwillingness of the West – the so-called ‘white world’ – to continue to bear the burden of welfare of the global deprived, to free itself from colonial guilt that shaped the post-war Western ethic and quest for universalisation of economic organising principles, developmental norms and humanitarian ideals, were all interrogated. In one telling moment, a Hobbesian existence was rationalised and there a shrugging off of the inevitability of a Lockean end state. In one telling moment, the future arrived to shake history by the scruff of its neck.

India as a leading power: Shaping the Development Narrative at Home and Abroad

April 07, 2017, Narendra Modi’s Website

Original link is here

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If the modest success of the Millennium Development Goals (MDGs) had at its core the remarkable story of China lifting its people from poverty and mass deprivation to the cusp of a middle-income society, the Sustainable Development Goals 2030 (SDGs) agreed by the global community in 2015 will essentially be the narrative of India doing the same in a very different world and context. The SDGs will only be met when India moves its 270 odd million citizens from abject poverty to an existence that a country aspiring to be a great power must offer. A space where the “ease of living” is as central to the ethos of the nation as the “ease of doing business”. Where national security is first and foremost predicated on India’s human security and on its zeal for combating hunger, disease, malnutrition, child mortality and its determination to provide maternal care and child care for all.

The SDG equation is quite simple. If India fails to meet the SDGs, the global SDGs will fail. If India succeeds, as it must, the global community succeeds and India has an “India Model” that will become a blueprint for large parts of the world to emulate. This is what “great powers” do: they provide solutions and roadmaps for others. India as a leading power must take this challenge and deliver on it, for its own sake and for helping achieve the global ambition of a better world.

India’s position as a provider of global public goods will flow from its ability to reconcile its own structural inadequacies. India as a leading power will have to be a source of both ideas and solutions and of financial resources for global development. The latter capacity is inevitable as the economy will grow and its development partnership programme will expand. The former requires political leadership and institutional reinvention. The global need for Indian leadership is significant. The transformation of India will take place in a decade in which the traditional underwriters of this domain are hesitant, and in some cases shirking their obligations. This is increasingly a world where flow of capital and beneficial trade for the developing world is a memory of the past. The US, EU and other members of OECD are all exhibiting fatigue in carrying the burden of this responsibility and India must step up.

PM Modi’s Leadership

Prime Minister Modi from his early days in office has stressed this aspect of India’s growth and the urgency to eliminate poverty by creating decent employment and strengthening social programmes. Initiatives like Make in India, Digital India, Swachh Bharat Abhiyan, Skill India, Smart Cities, Start Up India, Beti Bachao Beti Padhao Yojana (BBBP), Deendayal Upadhyaya Gram Jyoti Yojana, Mission Indradhanush and Ujjwala Yojana will play a significant role in this narrative of Indian transformation.

Two recent statements, by the chief ministers of Uttar Pradesh and Haryana, have offered a sliver of optimism that the leadership at the Centre may be emulated in states that have traditionally been among the worst performing geographies on social indices. The first was when Chief Minister (CM) Shri Manohar Lal Khattar announced that the sex ratio at birth in Haryana, which was around the 850 mark in 2015, had improved to 938 in 2016. This is significant given that the sex ratio at birth in Haryana was between 762 and 860 in the preceding decade. What made the difference was the BBBP, launched in Haryana by the PM. It triggered multi-sectoral action to protect the girl child. It is commendable that Haryana also managed to improve its level of registration of births from 76% in 2000 to 100% by 2011. This enabled the government to actively track the sex ratio on a monthly basis at the district and sub-district levels, rather than wait for the decadal census or similar surveys.

The other important statement was issued by the newly elected UP CM, Yogi Adityanath, who has promised to hold the District Magistrate (DM) and Chief Medical Officers (CMO) accountable for deaths resulting from malnutrition or preventable disease in their districts. UP is the most populous state in India, representing one-sixth of the total population. If it were a country, it would be the fifth most populous in the world. While India is home to 270 million of the world’s 767 million poor, 60 million or more live in UP. UP also accounts for one-third of the total maternal deaths in India, with over 14,500 maternal deaths per year. Most of UP’s health and nutrition indicators lag behind the Indian average by a big margin. CM Adityanath’s proposal to develop an accountability framework is something India must grab irrespective of ideological biases.

Placed together, these announcements by the two CMs touched two significant aspects of the political economy of change. Firstly, the power of multi-sectoral action based on data and, secondly, the imperative of accountability. These two have responded to the PM’s call and perhaps now is an opportune time to enlist others and place human security at the top of the country’s priority list. It is indeed time to make high politics and high economics serve the most sacred of constitutional rights: the right to life.

What Can Be Done?

Haryana and Uttar Pradesh have made health and gender priority areas. This remarkable step by two major states whose success in these areas will determine India’s and in turn the world’s success as we approach 2030, needs to be amplified and mainstreamed. The Union government must consider helping create yearly SDG report cards that track these two and other SDGs at the district level (and below). Each of these performance papers must be championed and owned by Members of Parliament, legislators, DMs, CMOs and other officials tasked with managing the specific locality.

Rather than fall into the time-old trap of pan-Indian solutions, it is necessary to have contextual inputs to solve pressing problems in specific locations. India needs to be disaggregated at least to the district level to resolve some of our key challenges. Haryana’s success and Yogi Adityanath’s intervention provide an opportunity to start a nation-wide battle to offer the right to life and right to dignity to all, and to realise our demographic dividend in the process. Five steps are crucial and must be accorded utmost importance and attention.

  1. Need for health champions among our political entrepreneurs: The latest Mann Ki Baat, right after the release of the National Health Policy 2017, where the PM talked about mental health as well as maternal and child health sends a very positive signal. Hopefully, for the first time in post-Independence India, we have a PM who may actually want to become a health champion in the league of Aneurin Bevan, Lyndon Johnson, Otto van Bismarck and Tommy Douglas. Given the size of our country and the scale of our challenges, we need many such health champions. It is important all politicians and those with the capacity to help in this endeavour devise their specific contributions.
  1. Need for inter-sectoral action and joint-up governance: Learning from successful initiatives like BBBP, there is a need to enable inter-sectoral and inter-institutional convergence at the sub-national level. The social policy ecosystem will have to dismantle the silos and the fragmented approach that have blinded policymaking processes to broader determinants of outcomes.
  1. Need for innovative sources of financing: Although the last budget saw a significant rise in central allocations to health, new sources need to be pooled in, given the low absolute levels of spending. The private sector must contribute significantly to the PM’s initiatives to improve the quality of India’s human capital and philanthropists must be made part of any national planning process.
  1. Need for disaggregated tracking of outcomes: We must ensure we have reliable data sources to track outcomes regularly. While Haryana has 100% coverage of birth and death registration, UP still has only 68% birth registration and 46% death registration, placing a major handicap on the administration’s ability to track progress. This needs urgent rectification and the new UP CM’s attention towards this is highly desirable. Other states must follow suit.
  1. Need to leverage new technology in a big way: Disruption in technology has rendered many binding constraints and trade-offs of policymaking irrelevant. Whether it is taking services to underserved areas or helping collect data, or reaching out to the population with information campaigns, new technology will play a transformative role. But technology is a tool and a catalyst and will need to be backed by building up of institutional capacity.

If we take these five initiatives forward, Prime Minister Modi’s legacy will not just be a healthier India, but also of creating robust institutional framework that will guard against any relapse to the status-quo. It’s time to swallow the pill and internalise that SDGs are a story of India serving its own people and contributing to global transformation. It is time for a leading power to discover new pathways.

(Samir Saran is Vice President at the Observer Research Foundation)