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30 January 2016 K2_CATEGORY IAS Blog

Digital India


Digital India is an umbrella programme that covers multiple Government Ministries and Departments. It weaves together a large number of ideas and thoughts into a single, comprehensive vision so that each of them can be implemented as part of a larger goal. Each individual element stands on its own, but is also part of the entire Government. Digital India is implemented by the entire Government and being coordinated by the Department of Electronics & Information Technology (DeitY).

The vision of Digital India is centered on three key areas-

Infrastructure as a Utility to Every Citizen

  • High speed internet as a core utility shall be made available in all Gram Panchayats.
  • Cradle to grave digital identity - unique, lifelong, online and authenticable.
  • Mobile phone and Bank account would enable participation in digital and financial space at individual level.
  • Easy access to a Common Service Centre within their locality.
  • Shareable private space on a public Cloud.
  • Safe and secure Cyber-space in the country.

Governance and Services on Demand

  • Seamlessly integrated across departments or jurisdictions to provide easy and a single window access to all persons.
  • Government services available in real time from online and mobile platforms.
  • All citizen entitlements to be available on the Cloud to ensure easy access.
  • Government services digitally transformed for improving Ease of Doing Business.
  • Making financial transactions above a threshold, electronic and cashless.
  • Leveraging GIS for decision support systems and development.

Digital Empowerment of Citizens.

  • Universal digital literacy.
  • All digital resources universally accessible.
  • All Government documents/ certificates to be available on the Cloud.
  • Availability of digital resources / services in Indian languages.
  • Collaborative digital platforms for participative governance.
  • Portability of all entitlements for individuals through the Cloud.

Digital India aims to provide the much needed thrust to the following nine pillars of growth areas as summarised below:

Broadband Highways - This covers three sub components

  • Broadband for All Rural
  • Broadband for All Urban
  • National Information Infrastructure.

Universal Access to Mobile Connectivity - The initiative is to focus on network penetration and fill the gaps in connectivity in the country.

Public Internet Access Programme - The two sub components of Public Internet Access Programme are-

  • Common Service Centres
  • Post Offices as multi-service centres.

e-Governance – Reforming Government through Technology - Government Business Process Re-engineering using IT to improve transactions is the most critical for transformation across government and therefore needs to be implemented by all ministries/ departments.

The guiding principles for reforming government through technology are:

  • Form simplification and field reduction – Forms should be made simple and user friendly and only minimum and necessary information should be collected.
  • Online applications, tracking of their status and interface between departments should be provided.
  • Use of online repositories e.g. school certificates, voter ID cards, etc. should be mandated so that citizens are not required to submit these documents in physical form.
  • Integration of services and platforms, e.g. UIDAI, Payment Gateway, Mobile Platform, Electronic Data Interchange (EDI) etc. should be mandated to facilitate integrated and interoperable service delivery to citizens and businesses.

Other aspects of e-Governance include:

  • Electronic Databases – all databases and information should be electronic and not manual.
  • Workflow Automation Inside Government – The workflow inside government departments and agencies should be automated to enable efficient government processes and also to allow visibility of these processes to the citizens.
  • Public Grievance Redressal - IT should be used to automate, respond and analyze data to identify and resolve persistent problems. These would be largely process improvements.

e-Kranti (NeGP 2.0) – Electronic delivery of services- Some of the Mission Mode added to e-Kranti by the Apex Committee on National e-Governance Plan (NeGP) headed by the Cabinet Secretary are:

  • Technology for Education – e-Education - All Schools will be connected with broadband.  Free wifi will be provided in all secondary and higher secondary schools (coverage would be around 250,000 schools). A programme on digital literacy would be taken up at the national level. MOOCs –Massive Online Open Courses shall be developed and leveraged for e-Education.
  • Technology for Health – e-Healthcare - E-Healthcare would cover online medical consultation, online medical records, online medicine supply, pan-India exchange for patient information. Pilots shall be undertaken in 2015 and full coverage would be provided in 3 years.
  • Technology for Farmers - This would facilitate farmers to get real time price information, online ordering of inputs and online cash, loan and relief payment with mobile banking.
  • Technology for Security - Mobile based emergency services and disaster related services would be provided to citizens on real time basis so as to take precautionary measures well in time and minimize loss of lives and properties.
  • Technology for Financial Inclusion - Financial Inclusion shall be strengthened using Mobile Banking, Micro-ATM program and CSCs/ Post Offices.
  • Technology for Justice - Interoperable Criminal Justice System shall be strengthened by leveraging e-Courts, e-Police, e-Jails and e-Prosecution.
  • Technology for Planning - National GIS Mission Mode Project would be implemented to facilitate GIS based decision making for project planning, conceptualization, design and development. 
  • Technology for Cyber Security - National Cyber Security Co-ordination Center would be set up to ensure safe and secure cyber-space within the country.

Information for All-  Open Data platform and online hosting of information & documents would facilitate open and easy access to information for citizens. Government shall pro-actively engage through social media and web based platforms to inform citizens. has already been launched as a medium to exchange ideas/ suggestions with Government. It will facilitate 2-waycommunication between citizens and government. Online messaging to citizens on special occasions/programs would be facilitated through emails and SMSes. 

Electronics Manufacturing – Target NET ZERO Imports

 IT for Jobs - 1 Cr students from smaller towns & villages will be trained for IT sector jobs over 5 years. DeitY would be the nodal department for this scheme.  BPOs would be set up in every north-eastern state to facilitate ICT enabled growth in these state· 3 lakh service delivery agents would be trained as part of skill development to run viable businesses delivering IT services.

 Early Harvest Programmes-  These programmes include the following aspects: 

  • IT Platform for Messages
  • Government Greetings to be e-Greetings
  • Biometric attendance
  • Wi-Fi in All Universities
  • Secure Email within Government
  • Standardize Government Email Design
  • Public Wi-fi hotspots
  • School Books to be eBooks
  • SMS based weather information, disaster alerts
  • National Portal for Lost & Found children

Program Management Structure:

A programme management structure would be established for monitoring implementation. Key components of the management structure would consist of the Cabinet Committee on Economic Affairs (CCEA) for according approval to projects, a Monitoring Committee headed by the Prime Minister, a Digital India Advisory Group chaired by the Minister of Communications and IT, an Apex Committee chaired by the Cabinet Secretary and the Expenditure Finance Committee (EFC) / Committee on Non Plan Expenditure (CNE).

Recent Developments (Jan 2015):

  • Facebook has partnered with the state-run Bharat Sanchar Nigam Limited (BSNL) for setting up 100 wi-fi (Wireless Fidelity) sites in rural India. The partnership is inked for three years with a possibility of extension for two more years.
  • Kerala has become the first state to be declared as totally digital state.
  • The Digital Saksharta Abhiyan (DISHA) mission has been launched to provide digital literacy to non IT literate citizens.
16 January 2016 K2_CATEGORY IAS Blog

Pradhan Mantri MUDRA Yojana

Pradhan Mantri Mudra YojanaThe government proposes to set up a Micro Units Development and Refinance Agency (MUDRA) Bank through a statutory enactment. This Bank would be responsible for regulating and refinancing all Micro-Finance Institutions (MFI) which are in the business of lending to micro/small business entities engaged in manufacturing, trading and services activities. The Bank would partner with state level/regional level co-ordinators to provide finance to Last Mile Financer of small/micro business enterprises.

Since the enactment for MUDRA is likely to take some time, it is proposed to initiate MUDRA as a unit of SIDBI to benefit from SIDBI’s initiatives and expertise.

The MUDRA Bank would primarily be responsible for –

1)  Laying down policy guidelines for micro/small enterprise financing business 

2)  Registration of MFI entities 

3)  Regulation of MFI entities

4)  Accreditation /rating of MFI

5)  Laying down responsible financing practices to ward off indebtedness and ensure proper client protection principles and methods of recovery

6)  Development of standardized set of covenants (agreements) governing last mile lending to micro/small enterprises

7)  Promoting right technology solutions for the last mile

8)  Formulating and running a Credit Guarantee scheme for providing guarantees to the loans which are being extended to micro enterprises

9)  Creating a good architecture of Last Mile Credit Delivery to micro businesses under the scheme of Pradhan Mantri Mudra Yojana

A sum of Rs 20,000 crore would be allocated to the MUDRA Bank from the money available from shortfalls of Priority Sector Lending for creating a Refinance Fund to provide refinance to the Last Mile Financers. Another Rs 3,000 crore would be provided to the MUDRA Bank from the budget to create a Credit Guarantee corpus for guaranteeing loans being provided to the micro enterprises.

Products and Offerings: The primary product of MUDRA will be refinance for lending to micro businesses / units under the aegis of the Pradhan Mantri MUDRA Yojana. The initial products and schemes under this umbrella have already been created and the interventions have been named ‘Shishu’, ‘Kishor’ and ‘Tarun’ to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur as also provide a reference point for the next phase of graduation / growth for the entrepreneur to aspire for:

- Shishu: covering loans upto Rs. 50,000/-
- Kishor: covering loans above Rs. 50,000/- and upto Rs. 5 lakh
- Tarun: covering loans above Rs. 5 lakh and upto Rs. 10 lakh

The products initially being launched are as under: 

  • Sector/activity specific schemes, such as schemes for business activities in Land Transport, Community, Social & Personal Services, Food Product and Textile Product sectors. Schemes would similarly be added for other sectors / activities.
  • Micro Credit Scheme (MCS)
  • Refinance Scheme for Regional Rural Banks (RRBs) / Scheduled Co-operative Banks
  • Mahila Uddyami Scheme
  • Business Loan for Traders & Shopkeepers
  • Missing Middle Credit Scheme
  • Equipment Finance for Micro Units

Credit Plus Approach:
MUDRA would also adopt a credit plus approach and take up interventions for development support across the entire spectrum of beneficiary segments. The highlights of such proposed interventions / initiatives are as under:

  • Supporting financial literacy
  • Promotion and Support of Grass Root Institutions
  • Creation of Framework for “Small Business Finance Entities”
  • Synergies with National Rural Livelihoods Mission
  • Synergies with National Skill Development Corporation
  • Working with Credit Bureaus
  • Working with Rating Agencies

Other Proposed Offerings: Going forward, offerings as under are also envisaged: 

  • MUDRA Card
  • Portfolio Credit Guarantee
  • Credit Enhancement

Some Facts:

  • According to the NSSO survey of 2013, there are 5.77 crore small business units, mostly individual proprietorships, which run small manufacturing, trading or services activities.
  • The players in the Micro Finance sector can be qualified as falling into 3 main groups- the SHG-Bank linkage model started by NABARD, the Non-Banking Finance companies and the others including Trusts, Societies etc.

Recent Developments (Jan,2016):

  • The Cabinet approved conversion of MUDRA Ltd, an NBFC, into MUDRA Bank and also setting up of a Credit Guarantee Fund for loans disbursed under the Pradhan Mantri Micro Units Development Refinance Agency (MUDRA) Yojana.
  • The finance ministry said that MUDRA loans amounting to Rs 71,312 crore have been disbursed to 1.73 crore borrowers as on January 2016.
  • The government refinanced online Rs.2000 crore under the MUDRA scheme, the rest Rs. 69,312 crore are loans disbursed by MFI and banks which have now been renamed as MUDRA loans.
  • Shishu accounts for 40%, Kishor for 37% and Tarun for 23% of total loans disbursed.
  • States getting biggest chunk of loans include- Karnataka (Rs. 8114 crore), Maharashtra (Rs.6988 crore) and Uttar Pradesh (Rs. 6547 crore).
  • The top three institutions that received refinance under the MUDRA scheme are: SKS Microfinance (Rs.100 crore), Ujjivan Financial Services Pvt Ltd(Rs.100 crore) and  Equitas Microfinance Pvt Ltd (Rs. 75 crore).


[Sources: PIB, inbministry, Telegraph India, PM Website, The Indian Express, The Economics Times]