India’s National Strategy on Blockchain – A Step Towards $5 Trillion Economy

The Ministry of Electronics and Information Technology (MeitY) has strategized National Blockchain Strategy, sharing its vision for creating shared Blockchain Infrastructure for India. Blockchain technology has deep potential and can be effectively used in various domains e.g., healthcare, agriculture, education, finance, and so on. Strategy charts out creation of a geographically distributed national level shared infrastructure, which will be necessary for providing large scale citizen services and for enabling cross domain application development. Industry, Startups and Government bodies have to apply for becoming part of the National Level Blockchain Infrastructure and before onboarding, entities will have to clear the security Audit.

The Framework will host wide variety of Blockchain based applications in the various areas e.g. maintenance of electronic health records, education certificate chain, medication supply chain, agriculture etc and so on. Blockchain-as-a-Service will be provided using this technology.

Blockchain Technology will create a valuable foundation for future economic development and creation of new business. According to Gartner, numerous new innovative companies will start employing Blockchain technology by 2022, and at least one of these businesses will be valued around $10 billion. By 2025, the business value will grow to the size of approx.  $176 billion and can touch the figure of $3.1 trillion, by 2030. According to Gartner, this will be possible due to the fact that by 2030, at least 30 % of the worldwide customer base will be made up of things using Blockchain serving as the underlying technology.

Globally various countries are working to develop the national blockchain infrastructure and India too needs to advance in this direction. China has launched Blockchain-based Service Network (BSN) for enabling faster and cheaper innovation for its companies. Network will support in developing applications focusing on advancement of digital economy. China is already working in the direction of digitising its land records, digital identity for its smart cities and improving connectivity and data sharing between smart cities.  European Union is working on its ambitious European Blockchain Services Infrastructure (EBSI) projects. The project will create enabling ecosystem for member states. Estonian government is working on Keyless Signature Infrastructure projects, United Arab Emirates is working on Smart Cities which will be fully powered by blockchain based solutions. 

Monetary Authority of Singapore (MAS) is applying Blockchain technology in making and developing cross border payment solutions. Zug in Switzerland has started to accept Bitcoin for tax purpose. Brazilian government has started using the Blockchain solutions in Government contracts and voting. Canada is using it for distribution and tracking of Government, while Chile is using it for energy distribution. 

Global corporations like Amazon, Microsoft, IBM, Oracle, LG, Samsung are developing various Blockchain based applications. Given the speedy global development and global consensus for moving towards decentralised applications, India’s National Blockchain Strategy is a steep in the right direction.

Various protocols are available Globally for developing the Network and Applications Infrastructure. Each of the protocol is different and have different merits in terms of scalability, speed of processing transactions, cost involved in the transaction. Ethereum,   Polkadot, Ripple are few of the platform.

In India, MeitY is supporting Distributed Centre of Excellence in Blockchain Technology. C-DAC &  Institute for Development & Research in Banking Technology (IDRBT) are executing the projects.

Centre of Excellence (CoE) in Blockchain technology has been established by NIC along with NICSI for focussing on applications in the areas of Digidhan, Public Distribution System, blood bank, land registration, GST Back Office and Excise Management System. NITI Aayog & Gujarat Narmada Valley Fertilizers & Chemicals Limited (GNFC) has developed a system for fertilizer subsidy which is based on Blockchain.  In India, Technology Adoption, Regulatory Compliance, Identification of Suitable Use Cases, Awareness and Skill Set and Data Format are going to be the key challenges.

India’s position on Virtual Currency is yet to be ascertained and we will have a better picture as and when it is presented in Parliament. However India’s strategy for National Blockchain Strategy is a welcome step in the direction for enabling innovations and creating new business using the potential of Blockchain. A decade from now will be very different from where we stand today. India has a vision of $5 trillion economy. We currently stand at $3 trillion and it will not be overoptimistic to anticipate that innovative business models, build on Blockchain and Digital currency will be an important lever to achieve the vision of $5 trillion economy.

Bureau Galactik Views

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