The most obvious is the search for a solution to a long-intractable problem: that rural India’s institutional infrastructure is woefully inadequate. The hope that ICT will help to manage rural India's social, political and administrative challenges and become a viable technology for the provision of health, education and other social services is thus ICT's strongest calling card. An additional expectation is that ICT will improve access to the large underserved market that rural India's 700 million people represent. Both expectations’ salience increases with the argument that India has the resources to build an ICT infrastructure, i.e., its large, skilled, cost-efficient IT workforce.

Over three months, from September to December 2004, our team from Stanford University and the National Informatics Center visited nine ICT projects, chosen for diversity and importance (see the list at the end of the article). We concluded that all the projects are still experimental. None has yet had a widespread socio-economic impact or even developed a catalytic, replicable approach. Under present operating conditions, financial self-sufficiency is, generally speaking, unlikely. The hope that ICT can build rural capacity for self-development has not been realized.

Some findings were as expected, such as poor infrastructure, high deployment and maintenance costs of the ICT infrastructure and inadequate content for eGovernance. A less expected finding is that EGovernance services are overwhelmingly the most needed but the least provided services – instead, most projects provide informational services, i.e., generic, non-customized services such as agricultural practices, weather forecasts and contact information; and, secondarily, they provide transactional services, i.e., the exchange of specific, customized informational services or funds between two or more parties, such as email or e-commerce.

The importance of eGovernance arises from the prolonged absence of self-sufficiency in rural areas, which has created an encompassing dependency of rural residents on locally elected officials and bureaucrats. The state needs to undertake two steps to help. First, it needs to parse the general rubric of eGovernance into components based on type, such as: (a) Generic information services about government projects and employment opportunities. (b) Customized information such as land records and birth certificates. (c) Approvals, such as for ‘below poverty line’ status, and grievance redress. (d) Social services: health, education, entitlement and other social services. (e) Mandatory services: taxation, updating land and population databases and (f) Exchange services: postal, banking and utility services

Second, for each type, the state needs a model for public-private partnerships in the creation and delivery of eGovernance services. Current approaches focus on using the private sector to bypass local officialdom, such as for delivering complaints to district officials. This is an arena most resistant to change. Instead, focusing on automation and back-end digitization of informational and exchange services, and outsourcing digitized social services to the private sector are some viable possibilities.

A second unexpected finding was that high deployment costs of an Internet infrastructure prevent projects from having enough resources to develop content. In addition, the weak (and costly) communications infrastructure has forced projects to store content locally than over the Internet.

These problems are because of the single-user model, i.e., the village kiosk is the only connection from the village. In no country, however developed, can a single user afford to pay for the entire transmission infrastructure. While this implies that public funds such as USO funds are needed, nevertheless a solution to using public funds needs to be carefully designed so as to retain incentives for competition and coverage within the public sector.

We recommend that:

1. The state should use universal service funds to deploy a network consisting of a data center at the state headquarters and a signal transmission infrastructure to the villages. All content service providers should be allowed to use the data center on a ‘nearly-free’ basis, eg., the first 100 MB could be provided without charge. The data center will be used to store content that can be accessed by a wide user base. Note that:

• The National Informatics Center is currently setting up data-centers at each state capital. The same should be made available for rural ICT.

• Remote storage has other advantages of access, updating, sharing with other groups and portability. For transactions with entities outside the village, remote storage is a necessity.

• Since all district and most block headquarters have fiber (by 2006, both government and private fiber will be available at all blocks), the subsidy will be required primarily to connect the village to the block, a distance usually less than 25km. For the ‘last-mile’, dial-up, cable/DSL and wireless technologies are all possible options.

• The private sector can be a licensee at all stages upto the delivery of the signal to the village.

2. At the village, the current single-operator system should be replaced by usage of the signal by multiple operators – NGOs, the private sector and government entities (such as the panchayat and postal system). These may be co-located in order to reduce the receiving-station costs and they may also share other infrastructure such as PCs. The local government should mediate this process to ensure that all those receiving signals have fair access. Local providers should then be able to compete with each other on the basis of content.

A framework of rules for managing the system upto local access should be provided to the state government by the Ministry of Rural Development (MRD)/ Ministry of Panchayati Raj Institutions.

Finally, we found that understanding needs and providing services requires low-cost training to enable rural users to become self-sufficient users of ICT. NGOs are best situated to provide such services, thus requiring them to be a key element of any viable approach.

We propose that a pilot project be implemented based on the above proposal.

List of projects reviewed: Bellandur Gram Panchayat Computer System, Boodikote Jagruthi Resource Center, eSeva APOnline Centers, Gyandoot G2C Network, HP iCommunity, ITC eChoupals, MSSRF InfoVillage Knowledge Centers, n-Logue Chiraag Kiosks, Wired Warana Village Project.

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