Smart cities and digital identity: India’s move towards a digital-first future

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The second-most populated nation on earth is in the midst of a digital transformation. Around 530 million Indian consumers are now thought to own a smartphone according to Zenith media and digital technology is making its way into the workplace and daily life. At the forefront of this transformation is India’s 100 Smart Cities Mission, launched in 2015, with a goal of developing 100 cities across the country that are citizen-friendly and sustainable. With around 70 percent of the world’s population forecast to live in cities by 2050, digital identity will play a big part in India’s future.

In 2009, the Indian government introduced an identity scheme called Aadhaar. It comprised the Unique Identification Authority of India, a 12-digit Unique Identification (UID) Number (called “Aadhaar”) that includes biometric data, allocating one to every resident in India.  By April 2016, more than a billion UIDs were in circulation, and the National Payments Corporation of India (NPCI) introduced the Unified Payment Interface (UPI), designed to make person-to-person (P2P) and e-commerce transactions quicker and easier. Naturally the UPI has significant implications in a connected, smart city environment, providing more secure authentication for citizens and also yielding substantial financial savings for government agencies and companies by eliminating ghosts and duplicates within systems.

The success of Aadhaar has enabled the expansion of digital payments and e-commerce in India and has also addressed key goals around financial inclusion along the way. As India’s smart city projects grow, Aadhaar and digital identity in general will come to play a larger role, helping advance financial access and improve information sharing. It will also be vital to helping people access many kinds of public services.

Digital identity and smart cities

Digital identity will be a key driver of smart cities in India, since all the data generated by Internet of Things (IoT) sensors and devices is designed to be used to make Indian people’s lives more convenient, efficient and productive.

Smart cities are, by definition, mobile environments, and the digital identity will effectively become every citizen’s link to both their public and social life, it can enable them to access all manner of new services and also has the potential to empower millions of Indians to engage with the modern world.

One of these services, not necessarily offered by the government but nonetheless important to India’s citizens, is banking. The future of banking in India is mobile, and with more people now owning smartphones, underpinning each individual’s security with a digital identity makes mobile banking for all a genuine possibility. In 2014, just 53 percent of Indians had a bank account – today that figure has leapt to 80 percent. Over one-third of people already use digital payments. As smart cities grow, these numbers are certain to grow with them.

What will the new digital identity and smart cities enable?

One benefit will be improved public services within smart cities. India’s Minister of Housing & Urban Affairs, Hardeep Singh Puri, said recently that initiatives like smart class rooms in Visakhapatnam and New Delhi, social equity centers in Bhubaneshwar and disaster resilience mechanisms, deployed in smart cities located in India’s coastal areas, have already enhanced life for people there. Cities are becoming cleaner thanks to the monitoring of cleaning work via connected CCTV cameras while the Intelligent Transit Management System in Ahmedabad has increased commuting and travel efficiency for citizens while also reducing operational costs.

This increase in intelligent public services will require public digital identities to both ensure the security of citizens’ personal information and also give them easier access to them.

Digital identity can also make everyday services better, such as improving public transport. India has already introduced schemes like Dial 108, which builds on smartphone proliferation to reduce response times to road accidents. States and municipalities throughout the country are looking at smart city solutions to enhance public transport: things like automated fare collection via mobile devices can help lower the 15 percent revenue loss inherent in the current manual systems. Using smart solutions and digital identities means public transport operators can automatically know who is on board public vehicles, can charge them accurately and also leverage data to plan services better. Research has shown that alleviating congestion at peak times by just 5-10 percent can potentially save big, densely-populated cities like India’s as much as $150 million per year.

No digital identity, no economic growth?

A recent GSMA report posited that for countries in Asia Pacific, no digital identity would mean no economic growth. The lack of access to different government platforms and inability to leverage existing digital identity systems to provide government services, would nullify the potential to foster digital, financial and social inclusion.

For India, it will be important to view digital identity as more than just a policy and convenience issue: it can be the very heart of the country’s digital transformation and give over a billion people the opportunity to interact with governments and businesses securely.

But security remains paramount

Of course when you do put so many people’s personal information into a giant database, you must ensure it is secure: India has struggled with that so far. Earlier this year Aadhaar was the subject of a huge hack, which led to the personal data of up to a billion people being available to buy online for around US$6. So as India takes the Aadhaar project forward, robust security will be essential.

Building a Digitally Empowered Society

India’s digital transformation is certainly happening apace. The country is adding nearly 110 million smartphone users every year and now has Aadhaar-compliant mobile devices with built-in biometric authentication.

India’s demographics are in favor of digital transformation too. India has among the highest numbers of young people entering the work force over the next two decades. These are young, technology-savvy workers who are familiar with the digital world and not married to traditional habits. They are far more likely to adopt digital public services under the umbrella of the digital identity than those who went before them. India is now moving into the future at an unprecedented rate, and the route it is taking to get there is digital.

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Steve Harris

I’ve been writing about technology for around 15 years and today focus mainly on all things telecoms - next generation networks, mobile, cloud computing and plenty more. For Futurity Media I am based in the Asia-Pacific region and keep a close eye on all things tech happening in that exciting part of the world.