Grand Tamasha: Decoding 3 layers of India’s digital public infrastructure

Lawyer Rahul Mattha argues that India’s model offers avoids the pitfalls of the hands-off approach of the United States and the regulatory intensive European model, offering a powerful “third way” developed and developing countries alike can follow

Across the world, a growing number of countries are experimenting with novel methods of building and operating digital public infrastructure, but a new book by the lawyer Rahul Mattha argues that India’s model offers avoids the pitfalls of the hands-off approach of the United States and the regulatory intensive European model, offering a powerful “third way” developed and developing countries alike can follow.

Across the world, a growing number of countries are experimenting with novel methods of building and operating digital public infrastructure. (HT Photo)

Matthan made these comments on the season premiere of Grand Tamasha, a weekly podcast on Indian politics and public policy co-produced by HT and the Carnegie Endowment for International Peace. Last week, Matthan sat down with host Milan Vaishnav to speak about his new book, The Third Way: India’s Revolutionary Approach to Data Governance. Matthan is a partner at the law firm Trilegal and recently served as advisor to the Ministry of Finance during India’s G20 presidency.

Matthan explained that nearly all digital public infrastructure (DPI) systems—including India’s— consist of three layers: access, engagement, and empowerment. In India, the access layer in India is the country’s digital identity program, Aadhaar. “This is the first layer of any digital public infrastructure stack because it allows a population a gateway into what is to come next.” What comes next is the engagement layer, in India epitomized through the Universal Payment Interface (UPI), the ubiquitous payment backbone in the country. “Once you’ve got a digital identity, you want to engage with other people who also have access to the system. The payments layer is one way in which you can do that,” explained Matthan. “And once you have engaged for a period of time, you lay down a digital trail…and you can use [that] to empower you to avail of a loan or some kind of a service.”

Matthan acknowledged that the threat of people being left out of this system is real and cannot be wished away. “Anyone who uses this approach must start with the presumption that no one should be left behind,” explained Matthan. “Having said that, the nature of any sort of digital transformation is that it takes time. As fast as digital it, as we roll out digital infrastructure, there will be…an ever-decreasing percentage of the population that will be left out for various reasons” having to do with infrastructure, technology, or other shortcomings. Matthan cautioned that India should refrain from mandating the use of such a system “until you are reasonably sure that the entire population that is affected has access and has the ability to use this infrastructure.”

Regarding whether India’s DPI approach can pay dividends abroad, he described an evolution in India’s thinking. “The wonderful thing about the G20 last year is that many countries stood up and said, ‘Look we’ve also built this.’ And it was lovely to see the various flavors of DPI that other countries have built and currently operating,” said Matthan, indicating the Indian model is one of many possibilities. “Other countries are right to bristle when India stands up and says, ‘We’re the only ones who have done this,’” said Matthan. “But to India’s credit, over the course of the G20, it stopped saying that and we started talking much more about the ‘DPI approach.’”