Leveraging digital infrastructure - making schemes deliver desired outcomes

Nandan Nilekani praises 2018 budget for leveraging the digital infrastructure. He could have faulted the government on many policies which can be modified now that identifying and targeting beneficiaries is possible, but the same are being continued or will be continued mindlessly.

https://economictimes.indiatimes.com/news/economy/policy/data-oil-to-help-run-the-economy-on-the-digital-highway-nandan-nilekani-non-executive-chairman-infosys/articleshow/62747902.cms?utm_source=twitter.com&utm_medium=Social&utm_campaign=ETTWMain

Here are a few schemes that can be improved with the help of sophisticated systems designed to  leverage the digital infrastructure available today.

1. Crop insurance – farmers and fields can be identified by using Aadhaar and GIS (satellite imagery – Geographical Information System); in case of crop failure, right compensation and timely disbursement can be made directly into the farmer’s account. The system will eliminate duplicate and ghost claims which have thwarted the crop insurance schemes leading to large scale farmers’ suicides across India. The cost – benefit of such a “sophisticated” system will be far better than loan waivers (last year Modi Government made loan waivers in excess of Rs.74K Crores; Rs. 34K Crores in UP alone). This system will be far more efficient than any insurance company’s systems and processes –the scheme can be implemented without bringing any insurance company in the loop!
2. Healthcare provision of Rs.5 lac per family – there is no need of bringing insurance companies in the loop. Using Aadhaar, families can be defined with non-duplicate members and direct cash transfer effected to empanelled (healthcare) service providers upon submission of their bills; the bills approval processes may be outsourced to insurance companies claims departments (efficient BPOs will come up and compete for claims processing). Big data analytics can reward efficient healthcare providers by directing more patients to them.
3. Free power to farmers should be stopped. Instead, DBT (Direct Benefits Transfer) based on scientific assessment can be made into farmer’s account. This will lead to avoidance of excessive water usage which is bad for the soil productivity and worse for the ecology (rapidly depleting water table).
4. Every child, using Aadhaar can be granted DBT for school fees – s/he can go to any empanelled school and receive credit for predetermined amount towards the fees. This will encourage competition among schools for higher quality education as the students will exercise choice.
5. Every individual entitled to low cost ration through the PDS should be free to buy the ration from any empanelled shop; the “sophisticated” system will make the payment to the shop to the extent of entitlement of the buyer. Shops will compete to provide better quality and low cost rations to customers as they will exercise choice; corrupt PDS shops will mend their ways very quickly.

One can think of many more examples of leveraging digital infrastructure and smart applications for disintermediation and creation of efficient and merit based ecosystem. In India we have enough talent to design and develop such systems.