Exporting Indian innovation

We can use IT for better delivery of public services-be it government, health
care or education. It can also be used for improving national security

Nandan Nilekani has been recently inducted into the government by the Prime
Minister of India, Manmohan Singh to head the Unique Identification Authority of
India, a new agency set up by the government to issue national biometric
identity cards across the country. Nilekani is former co-chairman of Infosys.
Lately he has been on the global talk circuit discussing his book, Imagining
India: The Idea of a Renewed Nation, which describes the ideas that guided
India's development and the challenges to cementing India's future as a

global power.

If you were the Prime Minister of India, how would you use technology to
address growth and solve problems?

I think there are many roles for technology, particularly information
technology, in the Indian context. First, we can use IT for better delivery of
public services-whether it is government, health care, education, or whatever.
Second, we can use technology for identifying beneficiaries, especially the
poor, so the correct people get entitlements from government.

There is the whole issue of using technology for land records so that we can
have much smoother land transfers and reduce litigation. You can use IT for
improving national security.

You can use it for tax collection. There is a proposal in India to implement
the goods and services (GST) tax, which can only be implemented using IT.
Throughout government, technology can play a very big role.

Can India become an important supplier of new technologies, delivering
innovation to the rest of the world?

Already, it is. Many Indian companies have created innovative business
models that are fundamentally disruptive, for example, ICICI Bank and Bharti,
which are now getting exported globally. ICICI Bank offers services in the UK
and Canada and Bharti is seriously looking at servicing international markets.

What telecom innovations are you referring to?

Telecom companies have been able to create very profitable operations and at
the same time dramatically reduce the price of phone calls as well as the value
of each recharge. They have been able to create high volume, very low cost, high
quality solutions. And as they go and offer these abroad as a service, they will
be competing aggressively with local providers.

They have managed to come up with ways of sharing infrastructure, for
example, making investments in technology on a variable basis. Instead of
spending a lot of money buying capital equipment, they pay their technology
partners on the basis of the usage of the equipment-the partners are paid for
each minute that is spoken. So they are able to transfer a capital cost into an
operating cost. This has created a whole new business model that is very elegant
and disruptive. And this came out of necessity-everybody couldn't afford to
invest capital in rural areas.

What about innovations in banking and health care?

ICICI Bank is able to offer banking transactions at much lower cost than any
existing banks. So when they offer their transactions in a foreign country, they
are very competitive on phone banking and Internet banking, because everything
they have done efficiently leverages technology. In electronic banking and
mobile banking, the number of innovations is very high and can be transferred.

In health care, many of the Indian hospitals, such as Narayana Hrudayalaya,
have come out with the ability to do a high volume of operations, including
heart surgery, at a very reasonable price.

Beyond exporting efficient business models, can India become a major
exporter of new technologies?

Yes, many people are developing products in health care and communications
that could be exported. Some estimates hold that 750 million Indians will own
mobile phones in the next few years.

What impact can or might these numbers have on India?

Mobile phones are already having a huge impact in India. When you look
around you see people from all walks of life using them. Ninety percent of
mobile phones in India are prepaid and 40 percent have recharge of less than 10
rupees. I think this is empowering people in many ways. It is enabling them to
get employment; enabling them to find prices for things they are selling, so
they can get the best possible prices; enabling them to get information on
weather and farming.

One of the great visions is that phones will allow even the poorest-or almost
the poorest-Indians to secure bank accounts and loans on fair terms.

Yes, it can provide financial inclusion by giving everybody access to banking
services, to get a loan. It can provide for ways to get cash transfers from the
government to the poor. The mobile phone applications are limited only by our
ability to conceive of things that can be done. Yet many of the efforts in this
direction are still just pilot projects.

What has to happen to implement them at large scale?

The reason we have so many pilots is that every pilot is being done by
different institutions with different technologies. Very much like the U.S.
health care system today-there is no common way for hospitals to exchange
medical records. Similarly, if you really want to do financial services on a
mass scale, you need standardization of financial records, standardization of
citizen identification, rules for interoperability of data, and so on. Since
those are lacking, you end up with a lot of fragmented applications but nothing
which is scaled up.

The reasons for such challenges are often not technical-they are either
political or economic. In government departments there is a normal tendency not
to share data. We fundamentally need to get out of that mindset. Where
businesses are involved, there is commercial interest in not wanting to share
the data. Governments have a huge role to define the sandbox in which you will
play. They need to define the framework with common data formats,
interoperability, and formal technical standards. Within that, of course,
businesses can innovate and develop solutions. The key is aligning multiple
stakeholders in different segments to come together and bring about standards.

Let's talk about Infosys specifically. What challenges need to be overcome
to make Infosys the largest IT services company in the world?

I think Infosys is fundamentally extremely well positioned to become the
trusted partner of choice for business transformation for companies around the
world. We want to keep accelerating change in our business model because the
world is developing fast. We need to offer software-as-a-service and more
platform-based services. One of the solutions we now offer is procurement.

Instead of just providing the IT for procurement, we tell customers we will
take over the procurement function and share in any savings they are able to
get.

Infosys caught the IT services wave. Is there a new technology opportunity
for the young companies in India today?

The IT services industry is going through a fair amount of metamorphosis. We
are seeing the rise of things such as cloud computing, software as a service,
mobility-based solutions, and sensor-based transaction tracking where sensors
monitor goods and the movements of things. Indian IT services firms often claim
they have tons of innovative new technology- but that they can't talk about it
very much, because what they build is the property of their clients.

Could you talk, at least generally, about some of the emerging
technologies Infosys has built for clients?

Many of our applications, especially our newer applications, are based on
mobility-using mobile phones, synchronizing mobile phones. We are doing a lot
with social commerce using the context of social computing to give businesses
far more intimate contact with their customers.

We are also building an application where we are essentially making retail
stores more intelligent by putting sensors on goods so we can see what customers
are buying. Based on people's choices we can point out for them, on the mobile
phone, special offers in the aisles they are in at the moment.

Infosys has sometimes suggested that its real value to clients is in the
new business processes they've helped develop. Could you give us a specific
example?

We are working with Alstom, which is a French power company. We are working
with Cisco on things such as order processing, and we've been able to bring in
process transformation there.

David Talbot

Source:Technology Review