Information Technology – Spurring growth of Indian Economy

Information Technology – Spurring growth of Indian Economy

The Information Technology (IT) sector has been a key driver of the economic growth in India positioning it on the global map as an offshoring destination for IT companies. Underlining excellent IT strength of the country, the key global IT companies are managed by Indian-origin executives.

The IT sector is helping India transform to the next level of development, reducing the need for cash transactions, thereby, bringing larger number of transactions on the digital platform. Use of digital payments increased by 55 per cent in volume in FY 2016-17[1]. Since internet and smartphones are ubiquitous now, e-wallets like Paytm, and MobiKwik are increasingly used for financial transactions, both personal and commercial, bringing transparency. Furthermore, online payment of Goods and Service tax, EPFO, ESIC, have made the tax collection mechanism more efficient and transparent.

IT has equipped businesses with communication and analytical power to trade and manage business at a global level with much ease. It is now possible to store, study, retrieve, transmit, and manipulate data with limited manual intervention. IT is aiding sharp improvements in various sectoral performance. For instance, manufacturing units leverage on ERP software to provide means of operational improvement for their company. The software allows for collection, storage and management of data for planning various business activities (inventory planning etc.). With regards to agriculture, IT, by way of price determination and awareness, databases can empower farmers to take informed and quality decisions.

IT has also transformed the governance system in the country. India has transitioned from a manual and cumbersome system to a strong IT-based governance moving towards the motto of Prime Minister, “Minimum Government, Maximum Governance”. Provisions like digital platform (Single Window System) for filing applications and obtaining approvals to start a business, computerized selection of inspectors to inspect business premises and online filing of labour returns have eliminated physical interface with the government officials and eliminated corrupt practices like inspector raj. This has reduced costs (both time and money) of the business and made doing business simpler and easier. Linking Aadhaar number with PAN card, mobile phones and bank account, which is helping direct transfer of benefits like education, healthcare to the beneficiaries has been possible due the expanding coverage of IT.

IT has the potential to make India become a superpower, however, this facility is limited to a small section of the society. The government is working towards fostering inclusive growth and IT can play a major role in this. Efforts towards creating wireless technology 5G, revamping the United Payment Interface (UPI) and launch of DTH channel DigiShala, to help people understand digital payments, are few, among other initiatives undertaken by the government in this direction.

[1] India Brand Equity Foundation (IBEF)

Danish A. Hashim, CII

Varsha Kumari, CII