Black money thrives in the cash economy. If we introduce traceability in financial transactions, it will be difficult to hide. We can do this using some simple available technologies. It is possible to carry out all transactions in electronic form, where money is transferred from the payer’s bank account to the payee’s. The back-end core banking system of almost all banks allows that. ATM withdrawals, any-branch banking and internet banking thrive on it. The internet, however, is used by a small section. Credit card (and debit card) based payments and transaction could be another way, but have not caught on much (except for use of debit cards for cash withdrawals).

But India has over 750 million mobile phone connections, and growing at 15 million per month. Over 500 million invididuals are believed to have mobiles. In a few years, mobile telephony could touch most of India’s adult population. It is now possible to link one’s mobile phone to a bank account. So, it is possible to carry out most transactions including money transfer, bill payments, balance enquiry and checks on past transactions. A bank’s computer uses the caller line identification (CLI) and a customer’s PIN to authenticate her, following which any transaction can be carried out using an application loaded on her phone. End-to-end encryption makes transactions secure. Transactions are instantaneous: for example, any payment is notified by sending an SMS to the payer as well as payee.

Since two people with direct experience, LIRNEasia international advisory board members Ashok Jhunjhunwala and KF Lai, were in town for the LIRNEasia@5 conference, I offered them as speakers to SLASSCOM. A well attended meeting that included local entrepreneurs such as Dinesh Saparamadu (hSenid) and Mifaan Careem (Respere) and a significant number of U of Moratuwa engineering students saw a fruitful exchange of views that has already led to the establishment of an entrepreneurs society at U of Moratuwa.

KF Lai talked about how he had been encouraged to start his own business while a government scientist, by the Government of Singapore. Ashok Jhunjhunwala, talked about how he has created a conducive environment for the incubation of start ups at IIT Madras. In the course of discussion we found that the Lanka Software Foundation had also created such an environment, albeit on a smaller scale in Sri Lanka. They both emphasized the need to have the burning desire for starting something new as an essential precondition for success.

LIRNEasia normally spends its CSR money in the disaster space. But we are happy that this little deviation is already beginning to yield results.

This was how a reader responded when Indian Express online carried a story on the dissemination of the findings of LIRNEasia’s broadband research at the GRT Grand Hotel convention centre in Chennai on November 3.

Another story in ‘The Hindu’ quoted Timothy Gonsalves PhD, Head of Computer Science and Engineering Department, IIT-Madras, our research partner from IIT Madras saying the implication [of the latency introduced by complex routing of network traffic] for consumers is that though a user may get close to the speeds advertised by the operator while accessing servers within India, the download speeds from an international server for even a supposedly fast broadband connection would only be in the 200 kbps range.

The event was attended by broadband operators, users and researchers. Helani Galpaya, Chanuka Wattegama and Timothy Gonsalves, PhD made presentations while Ashok Jhunjhunwala, PhD chaired the panel discussion.

Apart from the reported, the following were stories published by Indian, Sri Lanka and UK media.

“Broadband speed suffers most in accessing international servers” – The Hindu

Sri Lankan broadband users getting less: study – Lanka Business Online

South Asian broadband stuck in international bottleneck: study – Lanka Business Online

Developed countries getting better value from broadband – top 10 broadband

Sri Lanka’s broadband shows over advertising and under delivery – Sunday Times, Sri Lanka

The success and failure of policies and regulations need to be studied under such a backdrop. Each nation would have its specificities, and comparisons between nations may often be difficult. It is this
difficult task that the book takes up. It has done a great job in reminding us that the telecom demand is stronger than what most envisage. It points to the constraints posed by policies and regulations,
especially in reaching the BoP. It gives enough examples of what would indeed be possible only if one gets the policies right. It is a great book for those who influence policy and regulation. It is an interesting reading for those who are looking for novel business models to expand the market. Finally, it is a worthwhile reading for scientists and technologists who do not often understand the constraints posed by policy framework in limiting utilization and proliferation of technology.

Full review is here.

She mentions in several places that the SEC D&E consumers are willing to spend more money than expected on education, health and transport.  She also mentions ICTs.   In her talk she mentioned that many in SEC D are pulling their children out of government schools and putting them into private schools that teach in the English medium.  Her explanation, which I think is still a hypothesis, is the search for “escape velocity.”

The analogy is to the burst of energy required to break free of the earth’s gravitational pull.  These people and their children, she argues, are stuck.   If they do not do something unusual, they will remain in more or less the same socio-economic group.  They see education (in ICTs, in English, etc.) as something that will allow a child the break free of the gravitational pull holding back the family.   Maybe, actually break free; maybe, give the hope of breaking free.   If the child does break free, the whole family will be liberated.   They will move from SEC E to SEC C or whatever.

From a long time back people have been searching for the causal link between investment in ICTs and development.   If a dollar invested in ICTs gives 1+x dollars of economic growth, the case is made for greater investment in ICTs.   So we have studied transaction costs and all sorts of things, looking for the magic factor.

Perhaps we have not been asking the right question.   Ashok Jhunjhunwala’s slides showing a radical rearrangement of the urban and rural income quintiles (in the urban case, going from a pyramid shape to a classic bell shape within maybe 5-6 years of rapid growth; and in the rural case, changing the shape from an exponential decline to a more conventional pyramid) need to be brought into the discussion to fill this out.   His data seems to show that large numbers of Indians at the very bottom of the pyramid are moving up, changing the shape of the income distribution from a pyramid to a diamond, at least  in India’s urban areas.   The macro data shows a significant number of Indians gaining escape velocity.   

Rama, beginning from a completely different starting point of demand analysis, appears to see the same phenomenon. Is what she is seeing from the micro level and what Ashok is seeing from the macro that same thing?   Is this a general increase in mobility, or does ICT have something to do with it?   What kinds of questions can we include in our teleuse@BOP survey to capture this?   If we do capture it, how will it change the discourse on ICT4D?           

It was not long ago that Laloo Prasad Yadav Minister of Railways and former Bihar Chief Minister sarcastically asked what computers can do for his constituency, comprised mostly of agriculture communities. Had he been to Madurai with the CPRSouth participants on last Monday (Dec 17) perhaps he might have learnt.

This lady, with so many others, plays an integral role in ROPE (Rural Outsourced Production Enterprise) which sets up dedicated village-based contract production centers for its clients. Its mission is to integrate domestic and international markets with informal sectors of rural India and generate value for the skills and resources available in these sectors.

This lady and others like her, we were told, make INR 50 (USD 1.26) per day on this part time job of making banana ropes for products like window blinds, bags, mats etc. That per se does not put her above the USD 2 mark, but in rural India, it is a worthy extra income.

The project is one of Rural Technology and Business Incubator (RTBI) initiatives. A registered society established under the aegis of the Indian Institute of Technology, Madras, RTBI functions under the Chairmanship of Prof. Ashok Jhunjhunwala, Dept. of Electrical Engineering, IIT Madras. RTBI’s mission is to design, pilot and incubate business ventures with a specifically rural focus. Its vision is to facilitate /rural-inclusive/ technology and business development in the rural space.

Find more about RTBI here.

Find a full range of products manufactured under this project here.

LIRNEasia’s new book, ICT Infrastructure in Emerging Asia: Policy and Regulatory Roadblocks, was unveiled on the 16th of December at the IIT-Madras Campus. The first copies of the book were handed over to Chief Guests of the event, Professor Ashok Jhunjhunwala and Professor William Melody.

Edited by Professor Rohan Samarajiva and Ayesha Zainudeen and co-published by Sage Publications and the IDRC, this well-structured volume brings together scholars, practitioners, former regulators and policy makers to address the problem of expanding ICT connectivity in emerging Asia. It centrally engages the widespread claim that technology by itself—independent of policy and regulatory reform—can improve access to ICTs. In doing so, it shows that complex workarounds are possible, but they are significantly less effective than the appropriate policy and regulatory reforms.

More information on the book is available here. Media coverage can be seen here.

LIRNEasia’s first book, ICT Infrastructure in Emerging Asia: Policy and Regulatory Roadblocks, edited by Rohan Samarajiva and Ayesha Zainudeen will be launched on December 16 2007.

The Chief guests at the event will be Shri K.Sridhara, Member (Technology) & Ex-Officio Secretary to the Government of India, Department of Telecommunications, Ministry of Communications & IT, and Prof. Ashok Jhunjhunwala, Professor of the Department of Electrical Engineering, IIT Madras.

The book looks at the policy and regulatory barriers to the expansion of information and communication technology infrastructure in emerging markets, based on Asian experience and is co-published by SAGE Publications and the International Development Research Centre. More information available at http://www.lirneasia.net/projects/ict-infrastructure-in-emerging-asia/

Instead of resting on its laurels as the preferred IT services destination, technology players and academics in India must look to creating compelling products for the domestic and global market with an eye on cornering at least $15 billion worth business by 2015. This was the challenge thrown out by the National Association of Software and Service Companies (Nasscom) to the Indian IT industry, at its annual Product Conclave that opened in Bangalore on Nov 19, 2007. (Read the report in ‘The Hindu’)

Interestingly, last month Prof. Ashok Jhunjhunwala noted the same at the recent Wireless World Research Forum meeting in Chennai. He predicted India entering to the world leaders club as a design house in 2009 and a telecom product house by 2013. (See the presentation here)

As India knows well, the challenge of course is not just to find the right technology. The right products also need to have a price tag affordable to the millions at the bottom of the pyramid to attract the massive local market. It would be interesting to watch how India would face these dual challenges.

Business Process Outsourcing (BPO) at the Bottom of Pyramid (BOP) level is still not too common. Prof. Ashok Jhunjhunwala accompanied by a LIRNEasia team made a visit to Mahawilachchiya to have a close look at the first (still emerging) rural BPO there recently. On the same day, The Economic Times of India quoted Prof. Jhunjhunwala saying: ““Like manufacturing grew in China, services and manufacturing should grow in rural India. The sourcing and design can happen here (metros like Chennai) but the manufacturing should be taken to the rural areas and be managed through IT.”

Professor Jhunjhunwala has added that eventually people will set up their own enterprises in rural areas, thus mitigating widespread migration.Read the full story: http://tinyurl.com/2qugz2

Addendum by Rohan Samarajiva:

I happened upon an early account by Chulie de Silva of how it all began at Mahavilachchiya and Nivaththakachethiya that may be of interest to the readers of this thread (since it was, for a long time available on the web, I am assuming it is in the public domain): chulie_onwanni.doc

Ashok serves as Chair of CPRsouth, LIRNEasia’s principal capacity building initiative, and on LIRNEasia’s International Advisory Board.   He will visit Sri Lanka for the first time to deliver a keynote address at the South Asia Broadband Congess and Expo in Colombo, 4-6 September, 2007.  He is truly an inspiring public intellectual.

rediff.com: The inspiring story of an IIT professor

He revolutionised wireless in local loop technology in India. He founded the TeNet group (Telecommunications and Computer Networks) at the Indian Institute of Technology-Madras. And he is a professor at the Telematics and Optical Communication Lab at IIT-M. So who is he?

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Made in India PC for just about $100

The machine, launched by Chennai-based Novatium Solutions in 2004, costs a little over $100 as of today in the US currency, thanks to the depreciation in the greenback, but it was priced at less than $100 till a few months back.

Novatium is targeting 10 million users in the next five years for this innovative product, company CEO Alok Singh told PTI from Chennai.

The company has already started a successful commercial pilot for its NetPC computer in Chennai, he said.

“Since our trial was commercial in nature, we plan to stick to it. Going forward, we plan to expand into 6-7 big cities in the next year. Some of our immediate plans are going into two new cities in this quarter and two more in the next quarter,” Singh said.

Novatium was co-founded by US-based Analog Devices chairman Ray Stata, Netcore Solutions managing director Rajesh Jain and professor Ashok Jhunjhunwala of IIT Madras.

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CIOL : .NET & Windows : Make bandwidth available to all, says Kalam

NDTV’s Prannoy Roy moderated a discussion in which Ballmer, N R Narayana Murthy, Ashok Jhunjhunwala and Manvinder Singh of Ranbaxy participated. He started off by asking Ballmer about the contrasting personalities of the top two at Microsoft: small, shy and geeky versus flambuoyant and six feet six. Opposites make for the best partnerships was the reply.To a question on whether Google was making Microsoft change tracks and if we were going to get free software from Microsoft soon, Ballmer said the future held a mix of business models that would coexist and thrive, spurred by innovation.

Ravi Venkatesan kicked off the event, speaking of the contrasts in India: the millionaires and the malnourished children; the successful e-gov projects and the “graveyard of pilot projects.”