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Economic Survey 2022: A recap of developments in the technology sector

Survey data not only gives a glimpse of the current state of major tech areas, but also sheds light on where they’re headed.

The Unified Payments Interface is now the largest retail payments system in the country, trumping networks like National Electronic Funds Transfer System (NEFTS), Immediate Payment System (IMPS), and others, according to the Economic Survey 2021-22 tabled in Parliament on January 31. The survey remained largely bullish on technology growth, hailing government interventions in areas of electronics manufacturing, drones, telecom, space technology, etc.

The survey came one day ahead of the presentation of the Union Budget 2022-23 that called for technology-led growth. It provides an important recap of initiatives undertaken by the government over the last financial year.

Survey studied volume of UPI transactions

Key data points:

  • 50% of UPI transactions were below Rs 200, an examination of data from the National Payments Corporation of India (NPCI) revealed
  • 24.26 million One Time Mandates, at an amount of Rs 44,381 crore, were carried out on UPI after the Securities Exchange Board of India (SEBI) allowed it as a payment option for IPOs. OTMs are instructions for banks to allow automatic debits when shares under an IPO are allotted.
  • Adoption of UPI QR code standards: Bhutan became the first country to adopt UPI standards for QR Codes, and the second (after Singapore) to have UPI acceptance at merchant locations.
  • Expansion to Singapore: Singapore’s PayNow and UPI linkage targeted for operationalisation by July 2022. PayNow is the country’s own payment system, which will allow interoperability with UPI without relying on a third payment system.
  • 304.6 was the Digital Payments Index in September 2021, as calculated by the RBI. According to the survey, a base period of March 2018 is taken to calculate the metric which further captured:
    • Payment Enablers at 25% weightage
    • Payment Infrastructure – Demand-side factors at 10% weightage
    • Payment Infrastructure – Supply-side factors at 15% weightage
    • Payment Performance at 45% weightage
    • Consumer Centricity at 5% weightage

Multiple applications cleared under PLI schemes for electronics manufacturing

Production Linked Incentive (PLI) schemes were approved for at least 5 types of products in the electronics manufacturing sector, such as:

  1. Electronic/Technology Products
  2. Medical Devices
  3. Mobile Manufacturing and Specified Electronic Components
  4. Telecom and Networking Products
  5. Telecommunications

Under these schemes, financial incentives were given as percentages of sales to boost domestic production.

Key data points:

  • 16 applications worth Rs. 36,440 crores were approved in the first round after applications were opened. In the second round, 18 applications worth Rs. 483 crores were approved under the scheme for mobile phones and electronic components.
  • 13 applications with a committed investment of Rs. 798.93 crores have been approved for medical devices by the Department of Pharmaceuticals.
  • Rs. 2,595 crore investments approved under the PLI scheme for large-scale electronics manufacturing, according to the June 2021 Quarterly Revenue Recover (QRR) data. The scheme provides 4–6% incentives for electronic goods produced in India, such as phones.
  • Rs.67,275 crore worth of production took place under the PLI scheme for large-scale electronics manufacturing, of which 31% or Rs. 20,568 crore worth of products were exported.
  • Rs 16.50 crores invested in laptops, tablets, servers, and all-in-one PCs, according to QRR data. The scheme extends 1%-4% incentives on sales to an eligible company for four years.

Telecom coverage, number of subscribers, and more

The relevance of the telecom sector has increased, the survey said, listing data points as indicators of the same.

Key data points:

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  • 1200.88 million telephone subscribers in India as of March 2021, the survey said, citing data from the Department of Telecommunications (DoT).
  • 55% telecom subscribers are based in urban India while 45% are based in rural India.
  • 833.71 million internet subscribers as of June 2021. 96% of these subscribers have broadband connections while the rest have narrowband connections which have lower speeds.
  • 14.1 GB was the average wireless data usage in gigabyte (GB) per data user per month for the first quarter of the financial year 2021-22.
  • 6.93 lakh mobile towers have been installed in India as of December 2021
  •  1.73 lakh Gram Panchayats (GP) have been connected by Optical Fiber Cable (OFC) as of 27 September 2021 under the BharatNet Project (BNP). Under the project, the government looks to provide broadband connectivity to every Gram Panchayat.
  • 5.46 lakh kms of OFC has been laid under the BNP as of 27 September 2021.
  • 4,173 Gram Panchayats have been connected over satellite media
  • 64,000 Gram Panchayats have Wi-Fi hotspot services.
  • 161 out of 354 villages in border areas have mobile network. These border areas are in Jammu and Kashmir, Ladakh, Himachal Pradesh, Uttar Pradesh, Bihar, Rajasthan, Gujarat, and Uttarakhand.

Changes undertaken to reform the telecom sector:

  1. 100% foreign direct investment (FDI) permitted on October 6, 2021 in telecom companies.
  2. One Bank Guarantee (BG) against different license service areas (LSA) has been allowed. LSAs are areas where a service provider has been allowed to provide services while Bank guarantees are documents from banks that assure payment of an amount- in case of default by a client, the bank pays the amount.
  3. BG requirement removed for payment of installments after auctions.
  4. Tenure for future auctions raised to 30 years from 20 years.
  5. Spectrum usage charge (SUC) removed for future auctions. SUC is payable by a telecom company to the government for providing mobile access services, as a percentage of their Adjusted Gross Revenue.
  6. 0.5% SUC levied on spectrum sharing removed, the survey said, indicating that the government was promoting spectrum sharing.
  7. Spectrum auctions fixed to last quarter of a financial year
  8. Moratorium or deferment approved for payments on past auctions for up to 4 years.

Survey reported a rise in space-tech startups, but data is unclear

47 space-tech startups are present in India as of 2021, up from 21 startups in 2020, the survey said. It cited data from startup registrations undertaken by the Department of Promotion of Internal Trade and Industry (DPIIT) in the sector as well as certain other startups which are ‘registered under other categories but are also involved in the space domain’.

However, in spite of the survey saying that there were 47 space-tech startups in 2021, the data (screenshot below) provided is not clear as it later totals the figure to say that there are 101 such startups.

The survey added that it expects the sector to capture a ‘larger share of the global space economy’, although it currently lags at a 2% share of the space economy.

Source: Economic Survey 2021-22

Steps taken to promote drones

The Drone Rules, 2o21 which were introduced on August 25, replaced the older Unmanned Aircraft Systems Rules (UAS) 2021 to liberalise policies around drone use, the survey said. The Drone Rules can catalyse ‘super-normal’ growth in the sector, it added. Here are the key takeaways of the Rules:

  1. Exemptions introduced for nano and micro drones
  2. Number of approvals required cut to 5 from 25
  3. Quantum of fees to be paid reduced and delinked from size
  4. Introduction of ‘Digital Sky platform’ as a single window platform for one-step clearances
  5. Requirement for prior security clearance removed
  6. Expansion in perimeter of free zones (denoted as green zones) for flying
  7. One lakh rupees limit for penalties
  8. Certification requirements for manufacturers doing research and development in green zones removed
  9. 500kg drones brought under the ambit of the rules

Steps taken to promote geospatial data production and acquisition

February 2021 saw the government introduce the following guidelines in an attempt to liberalize mapping rules for Indian companies, according to the survey:

  1. Self certification required to show adherence with guidelines, removing earlier requirement for external certification
  2. Mapping prohibitions imposed only for ‘specific attributes of highly sensitive areas’
  3. Foreign companies restricted from conducting ground-truthing, street view and territorial water surveying . Only Indian companies can also process data above a certain accuracy. However, foreign companies can license such data from Indian companies through APIs to serve Indian customers
  4. Data produced using public funds to be made publicly accessible for scientific, economic, and developmental purposes. This exempts certain classified data.

One Nation One Ration Card scheme’s coverage is 94%

“Presently, the facility of national/inter-state portability is enabled in 34 States/UT covering nearly 75 crore beneficiaries (94.3 per cent of total NFSA population).” — Economic Survey 2022

NFSA population refers to beneficiaries under the National Food Security Act. The ONORC scheme allows migrants to get ration and other entitlements from fair price shop (FPS) through biometric or Aadhaar authentication on electronic Point of Sale (ePoS) devices.

Social sector initiatives for digitisation

Across education, health, and labour sectors, the survey listed key digitisation initiatives undertaken by the government in the financial year 2021-22.

For the health sector:

1. Aarogya Setu: The mobile app used Artificial Intelligence, Algorithms, and Bluetooth Technology to help people detect their risk of infection, the survey said.

2. CoWIN 2.0:  CoWIN supported the vaccination drive by allowing the registration and tracking of beneficiaries, tracking of vaccine stocks, etc. the survey said.

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3. Ayushman Bharat Digital Mission: To bridge the gap between different stakeholders of the health ecosystem through ‘digital highways’ the ABDM was launched, the survey said. It comprises Unique Health IDs, Health Professionals Registry, Healthcare Facility Registry, Electronic Health Records, and other building blocks.

4. E-Sanjeevani: The Ministry of Health and Family Welfare (MoHFW) upgraded the E-Sanjeevani application to offer teleconsultations between patients and doctors, free of cost, during the pandemic. The survey provided figures in regards  to the uptake of this platform:

  •      3.74 lakh Common Service Centres (CSCs) have been integrated with the platform.
  •      36 States and Union Territories have made the platform operational.

For the education sector:

“Further, to overcome the challenge of digital divide and to continue learning during pandemic, Government took measures such as distribution of textbooks at homes, telephonic guidance by teachers, online and digital content through TV and radio, TARA interactive Chatbot, activity-based learning through the Alternate Academic Calendar released by National Council of Educational Research and Training (NCERT),” the survey said. It further listed the following steps taken by the government during the pandemic:

1. PM E-Vidya

According to the survey, the initiative tries to unify digital/online/radio education for multi-mode access. This included:

  • Access through DIKSHA platform. DIKSHA is an online portal that hosts teaching, assessment, and other logistical support material. A variety of content: 490 textbook-based Indian Sign Language videos, a dictionary of ISL, and 3,092 audiobook chapters have been made available through it, for hearing and visually-impaired students.
  • ‘One Class, One TV Channel’ through Swayam Prabha TV Channels
  • Use of radio, community radio, and podcasts
  • Direct-to-home channel for the hearing impaired, in sign language.

2. National Digital Education Architecture (NDEAR): Launched to provide a federated, inter-operable architecture for learning, teaching, planning, and administrative activities of the Centre, State and Union Territories.

For the labour sector:

1. Atmanirbhar Skilled Employee Employer Mapping (ASEEM) Portal: The ASEEM portal was launched to match skilled workforce with employers looking for them. According to the survey, it provides AI-based interfaces for individuals to access local jobs based on their profile, employers to predict their future demand, and a management dashboard with analytics for decision making.

  • 1.38 crore candidates have been registered on the portal including candidates registered on Skill India Portal (SIP) as of 31st December 2021.
  • 26.7 lakh migrants’ profiles are also available on the portal.

2. E-Shram Portal: Over 22.85 crore workers have been registered on the portal, which was launched in August 2021, to create a National Database of Unorganised Workers. The survey lists the top-ranked states based on number of enrolments:

  • 34.9% from Uttar Pradesh
  • 10.7% from West Bengal
  • 10.7% from Bihar
  • 5.7% from Odisha
  • 3.5% from Madhya Pradesh
  • 3.5% from Jharkhand

3. Maandhan portal: Potential beneficiaries under schemes Pradhan Mantri Shram Yogi Maan-Dhan (PM-SYM) Yojana and the pension scheme for traders, shopkeepers and self-employed persons can self-register themselves on the Maandhan portal. The schemes provide Rs 3,000 as monthly income after beneficiaries turn 60 subject to monthly payments.

For the MSME sector

Udyam Portal: Over 66 lakh MSMEs have registered themselves on the government’s Udyam portal which was launched in July 2020. According to the survey, Aadhaar and PAN details are required for such registration. It gives the following breakdown for the number of registrations on the portal:

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  • 62,79,858 are micro enterprises
  • 3,19,793 are small enterprises
  • 34,355 are medium enterprises

Budget 2022-23 focuses on technology-led growth

Here are the key tech-related announcements that were made by Finance Minister Nirmala Sitharaman while presenting the Union Budget 2022-23 in Parliament on February 1:

  1. RBI will launch a digital rupee in 2022-23
  2. 30% Taxation rate on ‘digital asset transfers’
  3. 5G spectrum auctions to be conducted in 2023
  4. 75 Digital Banking Units will be set up by scheduled cooperative banks in 75 districts
  5. A digital university will be set up, with collaboration from public universities and content available in Indian languages.
  6. Drones as a service will be promoted under a new initiative called ‘Drone Shakti’
  7. E-passports with embedded chips will begun to be issued

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Written By

I cover health technology for MediaNama but, really, love all things tech policy. Always willing to chat with a reader! Reach me at anushka@medianama.com

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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