June 2005

Policy Study for Rural Karnataka’s ICT Projects

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Rural Information and Communication Technology (ICT) projects could prove to be an effective mean of driving social, economic and political change in the rural areas. Despite Karnataka leading India's IT drive, the many ICT initiatives implemented in the rural parts of the state have not brought about any radical change in service delivery to this section of society.

Currently, rural Karnataka's ICT scenario is dotted with a large number of independent pilot projects, with most models based on subsidy schemes. Plans for any rural ICT initiative should primarily look at the economic viability of the initiative. Given the low population density in comparison to urban areas and the restricted paying capacity of a large percentage of the rural community, this is a challenge.

This challenge could be overcome if multiple service providers and enablers collectively adapt their service delivery mechanisms to create a profitable model, giving the rural community a combination of ICT based services. This combination of services should have a regional orientation and should benefit them to an extent that they are willing to pay the stated price.

There are currently no systems and policies to facilitate and bring about this much needed integration of ICT initiatives across the state.

Approach
ICT initiatives across rural Karnataka were compiled using various resources. Thirty six organisations were short listed including fourteen government departments. These included application providers from the sectors pertaining to agriculture produce marketing, public administration and education. Among the short listed organisations, there were also companies involved in research and manufacture of ICT equipment especially for the rural market, corporate organisations providing ICT services for the rural community, nationalised banks providing micro-credit services and NGOs working on rural ICT initiatives. It also included infrastructure providers and financiers (power and telecom).

Detailed discussions were held with senior personnel in these organisations on the nature of the initiative, its objective, geographical coverage, its current status and beneficiary profile, expansion plans, efforts involved in implementing these initiatives, problems faced and sustainability and replicability of the initiative.

The project team also met private entrepreneurs working towards providing a basket of services to the rural community by taking up a franchise of a government initiative.

Two villages where the people have some access to ICT initiatives were surveyed and selected so that the people would have a better understanding of ICT applications and would therefore be able to state their needs clearly.

Based on all these discussions and survey findings, recommendations on policy and systems for maximising the benefits of service delivery through ICTs were drafted. These were discussed with the various stakeholders during a workshop and their suggestions were analysed and incorporated into the final recommendations.

Major ICT initiatives across rural Karnataka
While there are many ICT initiatives in the state, some of the major ones are detailed below.

  • BHOOMI: The Bhoomi project, implemented by the Department of Public Administration and Revenue (DPAR), makes available a computerised Record of Rights, Tenancy and Crops (RTC) to all landowners at a kiosk in the taluka (sub-district administrative units) office, on payment of $0.25 (approx.) per RTC. In recent times, the DPAR is promoting private franchise models in which the franchisees have to bear the cost of the infrastructure and Internet connection. They can charge $0.3 to $0.5 (approx.) per RTC against the $0.25 charged at the taluka office. This is one initiative that has the capability of breaking even on Operation and Management (O&M) costs, primarily because of the essential nature of the service and the volumes (each landowner requires atleast one set of certificates per year and has to take as many certificates as the number of survey numbers in which he has landholdings).
  • The Education department has three parallel ICT programmes for rural schools.
    1. The 'Mahiti Sindhu' programme addresses computer education for high school (Std VIII, IX, X) students and teachers in 1000 schools of Karnataka. Each of the 1000 schools have been provided anywhere between six to fifteen computers with power backup, a printer and basic software.  Internet connectivity is available and a person has been appointed in each school to impart computer education.
    2. In association with the Azim Premji Foundation (APF), the Education Department is creating Computer Assisted Learning Centres (CALCs) in government primary schools across the state. APF makes a range of multi-lingual CDs to assist primary school children in grasping their curricular subjects (computer aided education). Each CALC has 4-5 computers, a printer and UPS.
    3. Intel has tied up with the Education Department to impart training to teachers to innovatively use computer technology to enhance student learning in the 1000 schools under the 'Mahiti Sindhu' programme.

    Apart from these, the Indian Space Research Organisation (ISRO) has recently launched a satellite dedicated to education services. 800 government primary schools in Chamarajanagar district have been selected for the pilot implementation of an interactive distance education project. Each school has got one computer and satellite connectivity.

  • The Department of Agricultural Marketing regulates market practices for agricultural commodities. Quantities and prices of agricultural produce traded in the different markets are available on a website that is updated daily. 112 of the 145 Agriculture Produce Market Communities (APMCs) have a computer which can be accessed by farmers to see the daily prices of the agricultural commodities. 
  • The Asia Heart Foundation has set up telemedicine links between a premier cardiac hospital and 23 hospitals across the country, ten of which are in Karnataka. Each telemedicine consulting centre has 2 computers and power back up. The hospitals are connected through ISDN fibre-optic lines or VSAT links. Sustainability is a key issue especially when looking at replicating this initiative across district hospitals and primary health centres in the state. As in education, the government is considered responsible for providing these services, free of cost.
  • The Safal Fruit and Vegetable Auction Market (SFVAM) of National Dairy Development Board has set up 100 farmers' associations or collection centres, for auctioning of fruits and vegetables. The associations are being given a computer and required communication infrastructure in a phased manner.


Findings
ICTs have made considerable inroads into Karnataka's villages. Despite this, the study found that awareness about the potential for using ICTs and the stated need is limited. Children's education and procurement of government forms are considered the two most useful applications and people are ready to pay for these services. They are also open to paying a nominal fee for access to better health services and for awareness on health issues. The villagers showed interest in utilising the ICT infrastructure for entertainment purposes. It is necessary to have public participation, so that the system is sustainable irrespective of the budget allocations and therefore replicable.

Private entrepreneurs are also only aware of some of the common applications. They need capacity building and networking assistance to be able to offer a larger number of required services. NGOs can play a vital role in driving change in their geographical area of work.

Discussions showed that ICT equipment installed by a service provider is used only for one specific application and since volume of transactions are low there is sub-optimal utilisation of installed infrastructure.  In the surveyed villages, it was found that within a 10 km. radius, there are 30 computers with 7 printers and adequate power backup, 3 trained computer teachers and a number of young people trained in basic computer packages. These computers are used for imparting education to approximately 500 students and generating an average of 500 RTCs a month. It can comfortably be done with less than half the currently available resources.

Discussions with private entrepreneurs who have taken up a franchise for the 'Bhoomi' kiosk stated that their average monthly expenses on Internet connectivity, electricity, space rental and helper's salary are $70 (approx.). Apart from this, the entrepreneur has taken a loan to invest in the hardware and software amounting to $1300 (approx.). Monthly outgoing is approximately $85, excluding profits for the entrepreneur himself. The major revenue generator currently is the issuing of RTCs, giving annual revenuesof around $135 to $210. This revenue is not enough to sustain private enterprise.

The DPAR charges $0.25 for each RTC. Private entrepreneurs are allowed to charge upto $0.25 extra per RTCs. Most villagers have lands in multiple survey numbers, so they require multiple RTCs. If a village is close to the taluka office, the villagers prefer to get their RTC from the taluka office. Discussions with the villagers and private entrepreneurs showed that it is far easier getting an RTC from the taluka office than from the private entrepreneur, with the latter requiring signatures from village accountants who are not always present in the village. This drastically reduces business opportunities for the private entrepreneurs.

Moreover, it was found that there are multiple franchisees for the 'Bhoomi' project in close proximity to one another.  It is better to handhold a few franchisees in specific locations until there is enough usage of ICT based service to allow competition to flourish. Not only is there no inter-sectoral integration, a lack of intra-sectoral integration was also evident in the schemes run by the Department of Education, which has installed substantial infrastructure under three parallel schemes.  Fear of misuse by other users prevents those responsible from allowing it to be used for any purpose other than that stated and therefore computers installed for providing education to high school children are not being used by primary school children and vice-versa.

The non availability of electricity through most of the day in the villages is a major bottleneck. Every service provider has provided power back-up infrastructure for operating the systems for a maximum of four hours, which is not adequate.

One must understand that while computer technology and the Internet provide large opportunities, many are not yet comfortable with it. This is primarily due to low literacy levels and that many applications are text-based and the text is not in the local language. The prices of agricultural commodities are rarely accessed by farmers on a website, but the same information, if sent as a message to a village resource centre where it is printed and displayed, will be read by far more people. Such information could also be sent through the mobile phones to customers on request. Television and radio are established communication technologies and in the recent past the usage of mobile phones in rural areas has gone up considerably.

Policy recommendations
In view of the above, it is recommended that

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