india’s economic development: how does e-government...

India’s Economic Development: How Does E-Government

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Subhash [email protected]@iimahd.ernet.in

(Indian Institute of Management, Ahmedabad)

Presented during the Workshop on Indian Development Experience, Indian Institute of Science, Bangalore, March 3-5, 2003.

Presentation Structure

• E-Government: Definition, scope, different perceptions and delivery models

• Potential areas of economic impact• Has India harnessed the potential: some case

studies• What are the critical success factors in

implementing e-government?


E-Government: Scope and Definition

E-Government is about a process of reform in the way Governments work, share information and deliver services to external and internal clients for the benefit of both government and the citizens and businesses that they serve.

E-Government harnesses information technologies such as Wide Area Networks (WAN), Internet , World Wide Web, and mobile computing by government agencies to reach out to citizens, business, and other arms of the government to:

Improve delivery of services to citizensImprove interface with business and industryEmpower citizens through access to knowledge and information andMake the working of the government more efficient and effective

The resulting benefits could be more transparency, greater convenience, less corruption, revenue growth, and cost reduction


Different Delivery Models• Departments going on-line

– Greater departmental ownership: significant re-engineering possible– Citizen visit many departments, each one may be more efficient– Could be a first step in the absence of high band width network

• Conveniently located Service Centers– Counters manned by public/private agencies– Multiple services at each location: payment, licenses, certificates– Can quickly move traffic from departments to service centers– Requires significant coordination

• Self Service through a Portal one stop shop– Back end computerization and Integration needed for data sharing– High internet penetration; willingness and ability of citizen to use– Security and mutual trust (builds with successful outcome) – Usage builds up gradually. Adoption rate has to be driven.– Requires strong centralized leadership for extensive co-ordination



Potential for Economic Impact• Image of being investor friendly• Impact on Government finances

– Plugging leakage in Government revenue– Expenditure control

• Lowering corruption-makes industry more competitive• Stimulates production growth by correcting the incentive

structure• Improving service delivery helps increase all round

productivity • Increasing accountability: enhancing effectiveness/

efficiency of Government programs/ investments


India: Has there been an Impact?• Macro impact difficult to discern empirically

– Investments have been small– Effects are indirect– Egovernment is one of many tools of reform

• Individual case studies demonstrate some impact. Some examples in the next slide. Following cases discussed in detail: – Bhoomi– Gujarat Check Post– Gyandoot, NDDB

E-Government Applications with Some Economic Impact

• Services to citizens:BHOOMI, CARD, e-Seva• Customs on-line, Sales Tax, Octoroi• Computerisation of treasuries in Karnataka• Tax collection: State Border Check Posts, Gujarat• On-line municipal services:, VOICE in AP in India• Rural telecenter projects: Gyandoot in MP, Drishtee, Mahiti

Shakti, Swaminathan Foundation– Empowerment through knowledge– transparency, corruption and accountability

• NDDB milk collection and e-ChaupalPresented during the Workshop on Indian Development Experience,

Indian Institute of Science, Bangalore, March 3-5, 2003.


Land Record Computerization Bhoomi, Karnataka, India

• 20 million records of 6.7 million farmers spread over 9000 villages

• Village Accountant responsible for issue of certificates and mutation

• Certificate issue can take 3-30 days and a bribe of Rs 100-2000

• Mutation can take up to 2 years (30 days)• Encroachment of public land


Bhoomi: on-line delivery of certificates

• 180 centers where operators issue certificates on-line in 15 minutes for a fee of Rs 15 (30cents)

• Mutation request filed on line• Touch screen on pilot basis for easy access by citizens• Future plans to Web enable to provide access thru

kiosks• Security thru bio-log in procedure• Incisive MIS reports for follow up on mutation


Report Card on Bhoomi is GOOD• Survey: 180 users from 12 kiosks and 60 non users 4 taluks• Ease of Use: 78% of users who had used both systems found

Bhoomi simpler; 66% used Bhoomi without help vs. 28% in manual

• Complexity of Procedures: 80% did not have to meet any one other than at kiosk: In manual 19% met one officer and 61% met 2-4 officials

• Errors in documents: Bhoomi 8% vs manual 64%• Rectification of errors: sought correction 93 % vs 49%, timely

response 50% vs 4%• Cost of service: 84% one visit to Bhoomi center at Taluk HQ• Corruption: 66% paid bribes very often vs 3% in Bhoomi• Staff behavior: Bhoomi Good (84%) vs manual Average (63%)


Interstate Check posts in Gujarat • Project completed in 9 months at a total cost of Rs 630

million (70% on civil work). Yearly expenses: Rs 20 mln• Proportion of trucks checked increased from 2% to 100% ,

revenue up in 2 years- Rs 930 to Rs. 2370 million. Growth in mln Rs 310(98),560(99),930(00),1660(01),2370(02)

• Corruption due to collusion. Not just administrative• Penalty reduced from Rs 2000 per Ton to Rs 250• Survey of 142 drivers at 3 check posts• Following components do not work

– conversion of video image of registration plate– creation of a data base on all trucks– monitoring of images at a central point


Consequences of Administrative Corruption

• Largest cost is borne by the poor• Raises cost of doing business for SMEs by 20%• Irritant to investors, impedes FDI flows• Loss of revenue to Government• Disincentive to honest and efficient employees and citizens• Increases tolerance for corruption; society begins to value

the wrong attributes• Petty corruption can be organized to collect funds for

politicians• Petty corruption opportunities lead to bigger corruption in

appointments and transfers.


Minimizing Corruption Does Egovernment help?

• Introduces transparency in data, decisions/actions, rules, procedures and performance of Govt. agencies

• Automates processes to take away discretion• Entry point for simplification of rules and

reengineering processes• Makes decisions traceable- tracks actions • Builds accountability- greater access to information

through web publishing-role of civil society• Provides documentation to citizens for follow up


Egovernment-How does it help

• Introduces competition amongst delivery channels and departments

• Standardized documentation of comments/ objections leads to effective supervision- through comparative indicators

• Centralizes data for better audit and analysis Integration of data across applications-provides improved intelligence

• Enables unbiased sampling for audit purposes


Critical Success Factors• Strong Political and Administrative Leadership , detailed

Project Management• Clearly identified goals and benefits• Significant Process Reengineering Required• Start Small, scale up through stages, manage expectations • Adopt established standards and protocols – minimize

customization• In-source Analysis ; Outsource design, software

development, data preparation, training, etc.• Training Expenses should not be minimized

Enablers of e-Government

• 20 % Technology

• 35 % Business Process Reengineering

• 40 % Change Management

• 5% Luck !

Technology

ProcessPeople



Egovernment projects: Reasons for Poor Sustainability

• Cost-Benefit --Whose point of view?• Focus on revenue increase and not on benefits to truckers,

society, employees, transporters• Changes in political (chief minister, minister transport) and

administrative leadership (4 commissioners in 2yrs)• Lack of motivation to continue work of predecessor• Quick implementation: partial automation, not fully owned

by department, use of untested technologies• Lack of comfort in contracting with private sector• Technology as the only tool for reform. No other reform.

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