India is a global IT powerhouse but a huge majority of the population remains locked out of the benefits brought by the digital economy, the World Bank said on Tuesday.
India’s vibrant business process outsourcing sector, centered in the southern hubs of Bangalore and Hyderabad, has made it the leading exporter of IT services and skilled manpower in the developing world.
Yet nearly a billion people have no Internet access, the biggest offline population of any country, World Bank economists said at the India launch of the World Development Report 2016, Digital Dividends.
Fewer than two in five Indian businesses have an online presence, compared with almost two-thirds of Chinese firms, the report found.
India needs to strengthen the “analogue foundations” of its digital economy—providing affordable Internet access, training workers in new skills and beefing up regulations to ensure competition, the authors write.
“Skills and access, that is the key. India has all the other elements but that is what will really make it an inclusive revolution for India,” said Onno Ruhl, World Bank country director for India.
One barrier to online access for India’s millions of poor citizens is cost—a residential broadband service is six to ten times more expensive than in China.
However, India scored highly on the government’s use of technology, largely because of Aadhaar, a vast biometric database that aims to give every citizen a unique digital ID which can be linked to bank accounts.
“Adoption of digital technologies shows great variation within the country: very high for government and relatively low for businesses,” the World Bank said in a press statement.