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Draft document: Ver_001 Observations: E-Gov in India and delivery of services to citizens

My 10 years with

E-Governance and delivery of information and services to Rural

India

- Rajesh Prasad09304138357

[email protected]

of 21 - Rajesh Prasad, 09304138357, [email protected]


E-Gov in India and delivery of services to citizen

Introduction:The points and issues mentioned in this document are just some of the observed ones; and the observations are based on my continued assignments as implementer, consultant, program manager and service delivery expert for the past 10 years.

In the initial 3 years, working in Bihar, an enterprenur based model was adopted by us in setting up Soochanalays (information centers) in villages. Setting up of Soochnalays was a non-government supported initiative and was based on a aggregation of govt services, business services and BPO. Based on the proposed model, investments were invited and surprisingly, entrepreneurs were available in plenty to put in approx Rs 1.5 lakh per center. And that was a time when IT enabled service was a distant cry. A team of personnel were dedicated in collection of physical application forms from the Soochanalays and get them processed at block and district HQs. Officials too cooperated as they had no direct engagement with the COMPUTER. Caste, income, residence certificates and character certificates were the basic requirements. Slowly we added Learners Driving Licenses and that was a hit. Computer education, insurance and mobile recharges were the other services.

Mobile phones too had started their GPRS facility and I started experimenting. That was a time when IRCTC started its e-ticketing facility. I booked one on my AIRTEL mobile through the newly started GPRS facility. And with that booking, motivated the Soochanalaya operators to get their own mobiles for convenient connectivity. I managed two similar GPRS enabled mobiles and created a LAN in my office, connecting each mobile with three systems. Although slow, the facility provided connectivity to my office.

All this way back in 2004 – 2007. The best complement we got was when such Soochanalaya operators (rather entrepreneurs) acknowledged that they had moved on to a new path of livelihood which they had never thought of.

Starting May 2007, I got engaged with the Common Service Center as the State Anchor for the National Level Service Agency in Jharkhand. Since then, it has been CSC only for 7 years and things in the E-governance arena has moved a lot. NeGP brought many IT enabled project to light. Citizens had benefited. But then the issues and obstacles still remained the same. The reach was limited and the planners had limited themselves to display of success rather that actual delivery.

I had a deep understanding of the local conditions, local requirements and communication with the State was very convenient. Jharkhand adopted the entire CSC project concept in toto and thus behaved differently. As such, CSC became a network ready to be used. The State did not wait for individual components to be completed. Thus, even when just 30% CSCs were actually rolled out,



introduction of services started. Non-IT services started on a hybrid model. Govt approvals and legal / financial models were defined fast. VLEs started offering services and at the same time the State never shied away from experimenting. Thus VC based Jail e-mulakat started and won awards. Student and Forest data digitization were given to SCAs. The Rural Development dept slowly started using CSCs for MIS entries and for MNREGA payment disbursals. Slowly, E-District pilot was launched and all services were through CSCs. The ecosystem was vibrant and moving.

But not that the project was without problems. It faced all the issues that normally come in the way of Govt projects. Based on my continuous engagement with the CSC project, let me match issues that I have mentioned in the above document and suggest what would have been a better approach. The proactive steps taken by the State are also being highlighted.

E-Governance in IndiaIndia is a diverse country with disparities clearly visible at very small geographical intervals. While affluence and facilities are visible in cities, poverty and lack of convenience and facilities is equally visible just at the outskirts of the cities. While people in cities have comparatively better civic amenities, the people in surrounding areas do not have it at all. Power, road, job opportunities, cleanliness, education, health etc all fall under the same category and the disparity is uniform.

But one thing that has plagued all citizens equally is the lack of transparency and efficiency in availing services from their Government. Availing the Government services has been an equally difficult job for all citizens, be it in a city or in a village. Not long ago, I remember having frequented a government office regularly for over 25 days for the birth certificate of my first child. I got the service only after I finally obliged the issuing officer. And I am sure no one will be surprised to know that the certificate was issued within an hour and left me thinking as to why I wasted the 25 days just for such a petty amount.

This thought leaves many people who wish to avail services from the Government, to look at convenient ways leading to the rise of the middlemen.

Based on my personal experiences, let us look at some of the scenarios that people faced and are still subjected to:

Scenario 1: A person wants to deposit his house tax in time to the municipality. He visits the municipal office and gets trapped in the various discrepancies that the concerned staff brings to his notice. He is informed that although the tax would be just about Rs 250, penalties and other charges would be 10 times of that. The poor citizen either pays up or refuses to pay. In case he asks for details, he is asked to visit again at a time convenient to the municipal officer. Regular visits lead to little information and the citizen finally approached by a middleman outside the office who offers to get the entire issue settled for just Rs 1500. And the deal is struck and all parties, except the



citizen, gain in the process. The citizen is at least satisfied that he could save the additional Rs 1000 which was being demanded.

Scenario 2:Go to a railway reservation counter and you find a ling queue of people. When your turn comes, you hand over the application only to be told by the booking clerk that there is no vacancy. You are given a ticket which is Waitlist no. 200 and you are certain that it will not be confirmed.

You are approached by a tout who offers you a confirmed ticket for an extra payment of say Rs 1000. For an additional Rs 200 you can also get a window seat or a lower berth. And considering your urgency, you avail of this facility.

Scenario 3:A student passes his Class 10th Exam with flying colours and approaches a College where he has been offered admission. He needs a Caste or a Residence certificate and thus approaches the appropriate Block / Circle office. Understanding the urgency of the student, the office asks for bribes and the student obliges. He gets his certificate immediately.

I am sure all of us have gone through all the above scenarios either personally or have seen others go through them. The question that normally comes to our mind in such cases is the issue of extra payments, bribes, middlemen and the resultant corruption. While that is a valid concern, my queries were different.

And the question is “what does Governance mean to the people in the government”? As in the three examples cited above, in Scenario 1, while the citizen should have been encouraged by the Municipal officer to deposit his tax at the cash counter in two minutes, he was actually discouraged and threatened with penalties.

In Scenario 2, the booking clerk could have simply booked a ticket and cleared the queue at his counter. People would have got a ticket as per the availability.

In Scenario 3, the student had studied in a school and had a valid certificate. All his credentials are document in the school and the Board. Under such conditions, why should the college ask for a fresh Caste or Residence certificate again? These credentials should have been a matter of automatic proof.

On close examination, the use of power and authority for personal gains is the major reason why people in the government tend to behave in such a manner. The lack of transparency in the machinery acts as a veil which, keeping the citizen in the dark, enables the Govt functionary to force his way through.

Add to it the arbitrary processes. Every office requires a different set of documents. Banks, schools, colleges, government offices, employers; all offer similar set of services but require different documents. If documents are standardized, the templates are different. Things become so



difficult and confusing that a common man has no option but to get different documents for different serving institutions / organizations. A candidate willing to join the government, bank or army may have to submit three different Residence or Caste certificates in three different templates. And all these will be repeatedly issued by the same office.

So as demand is generated, citizens get subjected to the processes which lead to such inconveniences. The problem gets aggravated when the citizen has to meet the office staff at the Govt office.

The initial solution to this was considered to be the use of technology in service delivery. Use of Information Technology tools has been able to give rise to E-Governance; electronic governance with the objective of enabling low manual visits and interfaces. IT enables people to avail services from their home leaving the government office / serving office to offer the services without any bias or prejudice.

Progress in E-Governance In the last decade, E-Governance in India has made rapid progress. On the one hand, departments across the country, both at Central Govt and State Govt levels, have made many citizen centric services IT enabled. Many, rather most of the semi-government and quasi-government institutions have also adopted IT as a means of offering services, documents and information to their clients. This has led to a better and a more transparent ecosystem where a common citizen at least has the means of availing services and extracting documents and information from the opaque and highly inbound Government machinery.

Some of the prominent service delivery examples have been IRCTC, Income Tax dept, Municipal services and Municipal tax collection, issue of certificates and licenses through e-district, State Service Delivery Gateways etc, online payment mechanisms and online disbursal mechanisms. These platforms offer the basic services that citizens normally require on a regular or mandatory basis. There are other specialized services that also come in this category which have also enhanced the convenience of citizens.

All these developments led to some convenience to urban citizens. Rail reservations have more or less become a household affair and most of the urban travelers use IRCTC for rail ticket booking. For the less IT friendly citizens, IRCTC agents and cyber cafes have been useful. A normal salaried person now uses the Income Dept website for filing of returns. People have been using the various available portals for PAN card applications leading to rise in nos. of PAN card holders. Air tickets and bus tickets are also available online and some States have used technology for State transport bookings successfully. Although all these have been positive developments, despite all the expert advice and specialized services by IT leaders, there has been lack of vision and openness.

Let us see some examples:



1. Booking on IRCTC, I cannot see the availability transparently as can be seen in bus ticketing. I cannot choose a seat of my choice and the available option is such that I have to invest the amount a no. of times so as to get a seat of my choice. In bus ticket booking, I can select a seat of my choice and only then I need to pay. This makes things convenient and transparent. In case of IRCTC, although I cannot see the seat wise availability, the booking clerk at the counter can. So if I want two lower berths for my old parents, I can try once and then go to a tout. As such, connivance of the clerk and touts leads to an everlasting relationship which thrives on a traveler’s choice just because of a small missing facility on the portal. Alternatively, in case of Air ticketing, as a traveler, I have the facility to select a seat of my choice if I go for web-check in. By just slight modifications and additions in the IRCTC portal, railways can make vacancies more transparent and citizen friendly. A large chunk of touts will automatically be eliminated if this is adopted.

2. As a Class X pass out from CBSE, a student applies online to a College. He then is invited for admissions and gets into the manual processes. Barring some good universities, the manual processes are cumbersome and not in sync with the times. He has to submit certified copies of his documents including the Class X Certificate and marksheet. This despite the fact that both is available online on CBSE website and can be instantly verified.The student has to submit his Caste and Residence certificates although he may have been a regular student of the school for 10 years and his caste declared. Requirement of the documents may be essential, but depts. And institutions need to get in sync with the moving times and act accordingly. That will not only enhance citizen convenience but also eliminate a lot of work at their end too.

3. States have enacted the Right to Services Acts and have defined citizen charters with penal provisions if offices do not comply. But in reality, people remain unaware of the so called citizen charters. Offices take them for a ride and manipulate receipt and processing of applications for the notified services. Classic examples observed in various states range from physical manipulations and institutional manipulations. Offices in MP avoid giving acknowledgement receipts to applicants. Thus they have the option of entering application receipt and issuance dates in the online system showing compliance. In Bihar, the portal has automated SMS facility wherein all applications are shown as processed within defined timelines. This, as an institutional manipulation, uses IT to demonstrate compliance although compliance may not be actually done.

The present processes, even though IT enabled to some extent, are basically oriented in a way where the citizen basically needs to prove everything while all data remains with the



Governments. It is this orientation that is leading to the so called mis-governance and is leading to the rise of the middlemen despite all the IT enablement.

In sharp contrast, let us look at some of the private initiatives, which actually use IT as a tool to serve the customer.

1. Call a Whirlpool appliance customer care toll free no. and the executive greets you by your name. The caller’s mobile / phone no. is registered with all his details with the customer care and thus the courtesy. Place a complain and it is registered by the customer care executive giving you a ticket no. which is told to you by him and at the same time, sent via SMS to the registered mobile no. As a matter of verification, the executive confirms your address with a facility to update if the customer wanted to.

2. Call a Dominos and you do not need to repeat your address and name. All you need to order and wait for the promised delivery time. Convenient?

3. Call Airtel DTH for a service and you are promised a tentative time of visit and a satisfaction code. The executive / mechanic comes to your residence in the promised time. If your service is delivered satisfactorily, you tell the satisfaction code to the executive and he gets bonus points for the prompt service. Convenient and motivating?

The National eGovernance Plan:The Govt of India adopted the National eGovernance Plan, and focused mainly on the infrastructure development; SWAN, SDC and CSC. Simultaneously, IT enabled services were defined wherein integrated, central and State Mission mode projects were taken up. The objective was clear and focused. To make all services IT enabled and to facilitate creation of storage, distribution and delivery channels.

But as the implementation progressed, issues and bottlenecks started cropping up. The design and implementation approach adopted in NeGP also had inherent problems which started creating problems. In the long term, while it was seen that Consulting firms and IT firms were making good money and profits, the intended final beneficiary, citizens and the Government remained more or less stranded.

Let us look at some of the issues:

1. Despite all of the NeGP MMPs being implemented in the Public Private Partnership mode, there is a clear gap between the normal contractual assignments and the PPP assignments. It has normally been observed that although Private partners are invited and called in for the enrichment of the Govt projects, the midset of the project implementing machinery within the Govt does not rise above the vendor concept. Private partners get bogged down in the written lines and the intermittent Govt interference which lands them into buisiness traps.



A PPP project can flourish only if the Private Partner is considered as a Partner and not a Vendor. A private partner can then bring in all its expertise, struggle in areas where the Govt can not be of any use, adopt relevant best practices and create something that is beneficial to the citizens. The mindset too needs to be upgraded within the Govt. The normal practice observed across States is that Govts tend to bully the Private partners, often with partisan views, and lead to a situation where the actusl project implementation is stranded or delayed and thus loses relevance. So by the time projects see the light of the day, normal ecosystem outside the Govt gets enhanced leaving the implemented project of little use.

So the best way, for example, is to say “I want a State Wide Area Network which is spread across my State and is available to all govt offices 24 X 7 X 365”. List down the locations of the offices and give a minimum that can be acceptable at the start adding on gradually within a specified timeline. Now let Private Partners bid for it on a per node per annum rate. No expert advice by the Govt; no complelling them to use BSNL networks, no hardware and software specifications etc. Let the private partner choose its model and the technology and implement. Govt just mionitors the progress as per its requirement and starts using the network. The Private partner, with the autonomy, has to deliver and start getting its payments. And with that being the priority, business flourishes. The Govt benefits. Anyways, the above, though simple, needs a sea change in the Govt. The change is that the Govt machiery needs to understand that its knowledge in the domain is little and the Private partner, being an expert, can deliver. So, it should just look at the effectivity of the service that it wishes to have and not on the individual components. Do not look at their profits, look at the results that the partner has delivered.

2. In normal cases, a Project guideline or path is defined by the Central Govt and all States are directed to follow them. This start itself leads to project implementation bottlenecks. A single path cannot be applied in all geographical and demographic areas of a country as vast and diversified as India.Let me give an example.As per CSC project guidelines, penalties were defined and the agreements were signed. The agreement also defined timelines for setting up CSCs, without an objective study of ground realities. Soon, after start of implementation, the entire country faced the same problem; as assigned nos. of CSC could not be set up, how could the States move ahead. Being a BOO project, SCAs had set up some or most of the CSCs. So termination of the contract would lead to starting from the scratch. New partners would also be difficult to identify. So SCAs were asked to continue. And due to the delayed implementation, normally the penalties became higher than the payables. Repeated references to the Central Govt led to no assistance. And by then things got delayed and became irrelevant.



Could the private partners survive or even be interested in continuing ? Can a business environment be feasible under such conditions ? No. And the biggest loser is the citizen who could have availed convenient govt services.

3. Although seldom noticed, a major problem exists in the practice by the Central Govt to empanel consultancy firms, implementation agencies and even hardware suppliers. States have no room to maneuver and have to work under the indirectly created monopolistic environment. As a reason we see the high flying Consultancy firms creating such unrealistic DPRs, impractical and over-stuffed RFPs and partisan Contracts. States, during implementation phases, get to face unproductive or changing consultants as speed-breakers. The casualty is the project. In case of empanelled implementation agencies, States have little choices and even have to leave smaller agencies which may be better achievers in the past. Cartalization is also a natural outcome and no one has a way out. Hardware supplied by empanelled agencies have been seen to be normally a big issue when it comes to onsite warranty and repairs. Although empanelments are done by the Central depts, it does not take any responsibility in case the States face the mentioned problems. The question is; Why empanel all the above at the central level when the States have so different requirements and resources ? The Central govt depts tend to depend more on its own knowledge and less on the wisdom of the State govts.

4. Although the Central govt has the main say in all projects by providing funds, it evades being a partner. States follow the central guidelines, float standard RFPs, sign standard agreements with selected partners and follow all guidelines of the Central Govt as is issued from time to time. There is a lack of understanding of the fact that an Agreement, once signed, becomes a contractual document and can not be changed as per the directives of the Center. Private partners, although being unapproving of all such changes, normally keep away from openly objecting due to the financial implications.The Center should either be an active partner in all projects with all States, or just leave the entire implementation to the State. States should clearly be authorized to make changes in agreements as and when it and its private partner feels it necessary. The changes can be both, financial and non-financial in nature. Only with such independence can projects actually adapt to local requirements and flow in a more target oriented manner.

5. Flow of funds from the Center to the states also create confusing situations. The funds come to the States when the Center sends it, not when States actually need it. Despite being for IT, there is no automated fund flow management system at the center. As such, states have to face embarrassing situations when it cannot pay its partners due to shortage of funds. There are also times when States get funds but due to implementation related issues, have to keep funds parked and unutilized. In a recent example, all unutilized funds under all MMPs from all States were recalled. Funds were not released to them and as such, States felt a lot of heat.



6. A major issue that has limited the progress of actual service delivery and e-governance is the short sighted approach of all parties, especially the government as a whole. Efficiency of SWAN got limited due to the mandates making BSNL a major component in connecting nodes. CSC project too faced the same fate as BSNL was supposed to connect all panchayats through WiMax. After a lot of payments to BSNL and falied performances, VSATs were supplied with little results. In both cases, despite the complains of all parties with respect to the need for a proactive approach, connectivity still remains the main bottlenect. But due to the Govts’ preference of the BSNL route delivery of services to people remains at the mercy of the poor data cards and other options. In the spirit of a PPP project, the right way would have been to allow the private partners to design and develop a network of their own, that too with a viable business model. CSCs would have enjoyed good connectivity, meeting expectations of all stakeholders, including the deprived public.

7. Projects defined in 2006 as a PPP project had clearly defined viability and long term feasibility plans. But with time, and with changing Consultants and Officers, the business models went out of sight and projects have thus now been reduced to mere centrally sponsored projects waiting to be completed and thus reported. Had their been continuity in the concept and the implementation, many such projects would have stood the time and become self-propelled and self-sustainable initiatives.

8. Govt of India sponsored projects are normally seen in States differently. While the Project is inspiring for the State high ups, for the implementing dept / agency, it is just funds to be utilized. As such it is normally seen that projects are implemented, complete the funding life time and finally end. The actual output or the tangible benefit to the citizens or stakeholders is neither analysed nor emphasized properly. Govt of India too assesses performance of States based on the fund utilization and not on the actual benefits.

9. All initiatives under NeGP, State initiatives or even private initiatives have just one objective – provide convenienvce to citizens by way of using and facilitating use of technology in availing services. E-governance should thus have just one basis of assessment and appraisal – transactions and benefit to citizen.

10. And finally, a major issue observed across the country, it the Champion’s approach. A Champion, till the time he is there in the ecosystem, drives the projects, to great heights. But the progress sees a great downfall if the champion is not replaced by another champion. And normally the Champion is at the top of the pyramid. It would be rather more appropriate to create a team of champions at the middle and junior levels so as to keep the initiatives live and fruitful and less susceptible to changes in the hierarchy.



Case: Common Services Center project - the National perspectiveAn integrated MMP under NeGP, Common Services Center project aims at creating a network of 1 lakh ICT centers across rural India to facilitate delivery of government services to rural citizens with the help of ICT. The project, developed and designed under the PPP mode, is being implemented across the country and has both the sunny side and the dark side of it.

The basic concept of the CSC project as conceived may be enumerated as follows:

1. A PPP project with Govt of India, State and State Designated Agency, Service Center Agency and the Village Level Entrepreneur as the partners.

2. A Build Own Operate project with ownership lying at the SCA and VLE levels and Govt only to facilitate legal frameworks and services for delivery.

3. Entrepreneurship based franchise model so as to bring collective funds into the ecosystem.4. A National Level Service Agency was appointed as the Program Manager for

implementation of the project on a national basis. 5. Rollout of all CSCs was to be done in 12 months and SCA was expected to create the

entire infrastructure including facilitating connectivity, portal and service delivery platform.

6. Provision for revenue support to SCAs for 4 years for funding the CSC viability gap and NOT FOR CAPITAL INVESTMENTS OR INFRASTRUCTURE COST.

7. CSCs to mandatorily offer available Government services besides B2C. 8. An offset mechanism had been made part of the agreements which would have acted as

motivation for States to maximize G2C in the electronic mode. Offset mechanism was expected to nullify the payable revenue support in the long run, making the entire channel self-sustainable after the end of the revenue support funding.

9. Finally, CSC project would not be considered as a employment generation program or a social project. Its objective was to create a ICT network for delivery of Govt services across rural India on a self-sustainable business model.

Considering the above mentioned basics, let us look at the actual implementation.

Sl.no Basic point As was done As should have been done1 A PPP project with Govt of

India, State and State Designated Agency, Service Center Agency and the Village Level Entrepreneur as the partners

Despite being PPP, the vendor concept prevailed and instead of partnership, owner – contractor relationship prevailed. No best practices were brought in and DeitY and SDAs drove all initiatives.

DeitY and SDAs should have acted as facilitators and motivated the SCAs to act as partners to States. Govt machinery should have been sensitized to be more friendly and partners should have been allowed more innovative involvement.

2 A Build Own Operate project with ownership lying at the SCA

Contractually, SCAs are the owners of the CSCs. All delivery

Governments should have been sensitized to understand



and VLE levels and Govt only to facilitate legal frameworks and services for delivery

through CSCs should have appropriate business relationships. Try using a McDonald outlet for seling Tanishq jwellery without a business relationship ! Governments across the country tried to gain control over the CSCs and look at the VLE interests without any actual concern for the entrepreneur based franchisee model.

that enterprenuerial setups work on business models so as to attain sustainability.States should have respected the SCA VLE relationships and not interfered in their business models. Any delivery of service through CSCs should have been done through SCAs.

3 Entrepreneurship based franchise model so as to bring collective funds into the ecosystem

Entrepreneurship is all about investing in a proposal / project with the willing to accept all profits and losses. States started getting involved in the SCA – VLE business model and limiting the SCAs with State suggested models. Some States imposed on SCAs to adopt employee - employer models which finally led to failed implementations.

There should have been massive campaigns in the initial years informing citizens of the market driven model. Investments by VLE should have been made transparently accepted and that would have enabled better investments by SCAs.

4 A National Level Service Agency was appointed as the Program Manager for implementation of the project on a national basis.

The NLSA was responsible for CSC Program management with overall responsibility of bid management, project supervision, implementation, facilitating the PPP model, enabling a market driven and sustainable ecosystem and populating G2C.

NLSA started working in the right direction, but slowly, except for some States, got involved in the business of getting business for itself thus reducing its focus on the CSC project implementation. Instead of sensitization of Govts, facilitating PPP model, creating a sustainable business ecosystem, it becme a semi-Govt entity and started behaving like the Govt.

5 Rollout of all CSCs was to be done in 12 months and SCA was expected to create the entire infrastructure including facilitating connectivity, portal and service delivery platform

Timeline for rollout of 100% CSCs across States was contractually defined as 1 year with penalty provisions for delays. Payment of 50% of revenue support was also contractually allowed once 50% CSCs were made operational by SCAs. The term operational CSCs was defined as “as per satisfaction of

The timeline was highly impractical and was arbitrarily decided without much of thought on the diverse terrains and geographical / demographic considerations. Payments to SCAs got delayed and stranded as contractually 100% CSCs left little scope of relaxation. The



SDA”.Confusing payment and penalty provisions led to low cash flow conditions and the expected output was not delivered by the SCAs.

contract should have an inbuilt relaxation option (such as +/- 10%).Despite many SCAs achieving 50% target rollouts, release of payments should have been smooth. That would have infused cash flow in the ecosystem.

6 Provision for revenue support to SCAs for 4 years for funding the CSC viability gap and NOT FOR CAPITAL INVESTMENTS OR INFRASTRUCTURE COST

Post rollout, SCAs were to get revenue support for all operational CSCs for 48 months. Penalty was @ Rs 500 per week of non operations. Non-rollout penalty was @ Rs 100 per day of delay. Normally, rollout in States was delayed beyond expected timelines. Verification of CSCs was not done and that created an situation where SDAs could not ascertain the nos. of operational CSCs for payment of revenue support. In 2010, OMT was set up and OMT logs were considered as the basis of ascertaining nos. of operational CSCs. With the passing of time, normally non-operational and non-rollout penalties from the date of signing of contracts became more than the payable revenue supports. The project got jinxed as the signed contracts were to expire with little payments by Governments.

Some States requested DeitY for relaxations and advice. MP, HP, Rajasthan and Jharkhand took proactive steps and extended the contracts with SCAs for a further period of 4 years thus eliminating the past revenue support payments and penalties to ease the conditions.Central Govt should have been more proactive in facilitating States to take proactive steps in time so that the project could have continued with minimum disruptions.

7 CSCs to mandatorily offer available Government services besides B2C

Although all States promised a whole bunch of IT enabled services at the time of signing of CSC project contracts, lack of servicers through CSCs still plagues the project except for some progressive States. As the definition of operational CSC is related to G2C service delivery, it agin has a reflection on the revenue support payments.

Considering the fact that complete automation of services is yet to be achieved, CSCs are entities which should be used to its full capacity. The basic importance is of a facility where citizens can avail services with minimum interaction with the Govt offices. States should use



States stuck to allowing services through the CSCs only if the entire process is Electronic. Manual and hybrid, although available, were not allowed thus making the CSCs idle entities.

CSCs even if the services are manual / hybrid in nature. Some States like Jharkhand also used CSCs massively for data digitization, MIS and other G2G activities. This should have been the activity of the NLSA in which it failed completely. The casualty was the huge network which became non-viable and unproductive.

8 An offset mechanism had been made part of the agreements which would have acted as motivation for States to maximize G2C in the electronic mode. Offset mechanism was expected to nullify the payable revenue support in the long run, making the entire channel self-sustainable after the end of the revenue support funding

The offset mechanism, defined in the guidelines and MSAs, visualized sustained monetary benefit to SDAs and SCAs so that they increase the bunch of services being delivered through CSCs. The offset amount was expected to gradually nullify the payable revenue support thus making the channel self-sustainable in the post-revenue support period.

Except for a few States, none adopted this model due to lack of clarity on the offset mechanism. This reflects poorly on the NLSA as had it sensitized the States, none would have objected. To a large extent, Jharkhand’s model excels in this regards and can be a case study. In Jharkhand, offset was adopted as a matter of policy and the SDA and SCAs have earned handsome returns even from manual and hybrid services. With the present rapid pace of IT enablement and merger of major MMPs, it is expected that the offset will soon nullify the payable revenue support making the network self-sustainable.

9 CSC project would not be considered as a employment generation program or a social project. Its objective was to create a ICT network for delivery of Govt services across rural India on a self-sustainable business model.

The objective of the CSC project was very clear in the beginning. But with time and with changes in the govt machinery, the objective became obscure. All parties, Govt and Program managers started talking of the VLE and his benefits, his rights and earnings. SCAs were painted as villains and Govt and Program Managers started projecting themselves as the saviors of the VLEs.

CSC studies by various agencies have shown that although B2C services were expected to be the major pulling factor, sustainability of CSCs actually was better in places where Govt services had been enabled. Despite these findings, focus remains on B2C and allied services. Govts should have instead considered CSCs as private



Govt services, benefit to citizens and transactions demonstrating success of E-governance took a back seat.

outlets, more or less like cyber cafes, and concentrated on making electronically deliverable services a reality. By concentrating on just VLE interests, Govts have created an additional layer.

10 Role of the NLSA and SPV has been clearly defined and they were supposed to act as facilitators, manage the program impartially and promote the CSC concept amongst all stakeholders

The NLSA, riding on the reach in States, slowly lost focus of the CSC project and started developing its business from the E-Governance space. Most of these were non-citizen centric and infrastructural in nature, thus adding nothing to the CSC project. SCAs and SDAs were left to fend for themselves and thus there were grave deviations and lapses in the implementation. Things started moving only after the previous NLSA’s term ended. At the start, the SPV also focused on the project implementation, necessary corrections and started concentrating on locally relevant service aggregation with actual delivery to citizens in mind. But slowly, SPV too started acting just as aggregators and looking into all services with profit motives. Instead of respecting the contractual relations of SDAs, SCAs and VLEs, SPV started direct business. SCAs started objecting.

Central and State depts should have reigned in the then NLSA. By not doing so, the CSC channel became irrelevant with little support available. Extra intermediaries were brought into the service delivery channel making viability difficult. The same goes with SPV. The SPV is a private organization promoted by DeitY, SDAs and SCAs besides some other institutions. As States have shares in the SPV, they should make the SPV to concentrate on just merger of major MMPs, integration of major IT initiatives into the CSC project so that the citizens could actually get the intended benefits at the CSCs. SDAs and SCAs should get into agreements with the SPV so that there is a clear market defined revenue sharing contract. No distribution channel can sustain at the presently practiced models.

Case Study: CSC Project in Jharkhand 2006 till dateThe CSC project stated in Jharkhand in the initial phases and the bid process started way back in Aug 2006. Agreements were signed between SDA Jharkhand and SCAs in April 2007 although rollouts had started much prior to that ion Dec 2006. The State dept of IT, under the aggressive leadership of the then Pr Secretary, Sri R S Sharma, had tremendous clarity on the concept and thus Partners had little to be worried of SWAN and other projects such as online treasury, online



registration, hybrid certificate application, transport portals were all being set up and thus the SCAs had promising days ahead.

The three SCAs, M/s UTL – Orion eGov consortium, M/s Zoom Developers and M/s Alternative for India development started rollouts in the right earnest. SCAs selected a franchisee model foir CSCs and invited rural candidates to invest in the CSC enterprise. The initial investment was planned to be approx Rs 1.25 lakhs and even assured bank finances for the same. Being a PPP project, and having the required conceptual clarity, the Dept of IT and SDA carried on massive communication exercise and made the project clear to all Govt functionaries; starting from the divisional Commissioners, District Collectors down to the Block / Circle officers. Divisional level workshops were held in the period immediately after the signing of the agreement. All Districts were directed to appoint their District Informatics Officers as the project nodal officers. The State in the meantime set up the APEX committee, the Empowered Committee, the Divisional Monitoring Committee and the District committees, all having SCAs as the members for equality and collaborative participation. The service charges for citizens was also approved by the 1st

Empowered Committee and it had clearly defined service types, approved ratyes and shares of VLE, SCA and SDA as per the suggested project offset mechanism.

Soon, the rollout timeline ended and the issues started cropping up. All SCAs had reported having rolled out 98% of the targets. Verification of rolled out CSCs was initiated and random checks started. All 212 blocks were provided with funds of Rs 5000 each so that they could verify the reported CSCs (averaging approx 20 per block) physically.

1. Physical verification was very poor and no conclusions could be arrived at. 2. The verifiers had to verify the hardware and software deployment at the CSCs to ascertain

compliance of RFP terms; this was the main issue as no field functionary had that expertise.

3. Random calls were made to reported VLEs and especially in case of M/s UTL consortium, 60% of the reported CSCs were found to be fake.

4. The major consortium partner M/s UTL was directed to take charge and start afresh. 5. M/s Zoom Developers had also reported 98% rollouts but the hardware specifications

were not complied and connectivity was not facilitated. SDA deployed its team and only 20% of the CSCs could be considered for release of revenue support.

6. Palamu division, a left wing effected division, remained out of attention and thus no developments happened.

Although the rollout issues were a major setback, the Department started using CSCs for service delivery in whatever way they could. Districts were directed to use CSCs for all G2C and G2G activities at the approved rates. Rollouts continued in the meantime.

And institutionally, following were launched.



1. E-Nagarik sewa, a hybrid mechanism of certificate processing with tracking facility. It started in some districts and in the past 4 years, today has enabled about 2000 CSCs to get 50 lakh applications. The CSCs themselves have earned approx Rs 15 cr as service and allied charges while the SCAs and SDA have earned Rs 2.5 cr each as offset amounts.

2. E-Mulakat: Started as a pilot in one jail in Ranchi with a trial VC software on the SWAN (JharNet) network, it soon spread to 16 jails and subjails. It also received the Skotch Award foir 2011 for its smooth functioning in Dhanbad district.

3. Digitization of 17th Cattle Data survey for the Animal husbandry dept and 1500 CSCs earned approx Rs 1 cr as remuneration.

4. In Palamu division, district administrations rechristened CSCs as MNREGA Sewa kendras – cum – Pragya Kendras. MNREGA MIS entries, job applications and Job card issuance were enabled. Approved rates were paid as remuneration to VLEs.

5. District Legal Service Authorities in Palamu division appointed VLEs as DLSA volunteers to promote out of court settlement of disputes and participation of litigants in loak adalats.

6. Considering the State’s mandate to all its employees to submit salary bills online, VLEs grabbed the opportunity and facilitated the same for the govt functionaries located in distant areas.

7. In 2009, a tripartite agreement was signed between Commercial Tax Dept, SDA and SCAs and e-filing of VAT returns was started at 261 urban and semi-urban CSCs. The SDA had taken the proposal to the Empowered Committee and received approval. SCAs were thus permitted to set up CSCs in urban and semi-urban localities as per requiremernt of any service dept at ZERO revenue support.

8. In 2009, riding on the acceptance of the Rural development dept in using CSCs as standard BCs in villages, SCAs signed the BC agreement with SBI and BOI and launched kiosk banking in villages. This, with the help of the RD dept and DoIT, slowly eliminated the smart card and POS model and made payment disbursals more convenient and authenticated. By 2013, over 1100 panchayats were covered and slowly Aadhar enabled authentication and payments started. The project, called Panchayat bank project, received the National eGovernance Award in 2012.

9. In 2011, for the first time in the country, Jharkhand E-District pilot in Ranchi district made service delivery right at the panchayats with CSCs as the point odf delivery. No block or district facilitation centers and direct training to all functionaries ranging from the officials at the district HQs, Bloc/ circle offices, panchayat and revenue karmacharis and VLEs. The connectivity and hardware conditions of the entire 300 panchayats of the district went through a rapid upgrade and services extended to all panchayts and CSCs. in about 50 urban locations in the city. Certificates, RTI, pensions and municipal services were offered. The approved service charges and offset amount assured justified revenues to all parties. The State has now adopted the same model for the State wide replication of the E-district project. Till date approx 7 lakh applications have been received and Rs 1.4 cr has been earned by VLEs and Rs 35 lakh each by SCA and SDA.



10. In the meantime, B2C initiatives came and were added to the list. LIC prtemium collection, policy sales, General Insurance sales, BSNL recharge and product sales, railway ticketing, air ticketing mobile and DTH recharges etc all were done.

11. Some initiatives such as agreement with Dept of Posts for product sales could not deliver any output while IRCTC put up unrealistic conditions for appointing CSCs as agents.

In all the above, the stakeholders were assured of defined revenue shares through the offset mechanism. The earnings through the offset maintained the flow of funds into the ecosystem, thereby keeping it running and motivated.

But what was left to be tackled was the issue of verification of CSCs and release of revenue support. With the approval of the APEX Committee, the rollout timeline of the CSC project was redefined to Oct 2012 and thus revenue support period was extended to a period of 4 years thereafter (Oct 2012 to Sept 2016). With the redefinition of the rollout timeline, non-rollout and non-operational penalties amounting to approx Rs 24 cr was waived and payment of revenue support began. Incidentally, as per earlier calculation, payable revenue support was Rs 19 cr while overall penalties were Rs 24 cr. SCAs were at the verge of withdrawing themselves and the SDA was worried at the thought of having to either look for new SCAs or to controll the nearly 4000 VLEs itself. DeitY, despite several requests and reminders maintained the standard non-committal approach. The State was advised to take a call itself but as per the guidelines, the State had no option to make changes.

With the start of revenue support disbursal, OMT and OMT logs initially became the basis of payments and penalties. Gradually, after two quarters, transactions were made the additional basis and it was decided that gradually only transactions at CSCs would be the basis of payment disbursals. But then flow of funds had started and the ecosystem was now being driven with financial ease.

The State in this period, was moving rapidly ahead and Aadhar, MMPs, state initiatives were moving on priority basis. Additional services were enabled and CSCs were engaged in all of them.

1. Permanent Aadhar centers2. Complains and grievances3. Police complains4. Employment Exchange registrations5. Online payment gateway6. Registration dept services7. E-Panchayat 8. E-MIS for MNREGA9. E-payments



Of these only PEC gave good returns to VLEs, while the rest of the services did not catch up due to lack of awareness and SCA – VLE acceptance.

Now, let us see as to what proactive framework was created by the State in enabling implementation of the CSC Project:

1. Formation of the APEX Committee, Empowered Committee, Divisional Committees and appointment of District Nodal Officers in all 24 Districts. This enabled smooth and timely policy decisions, monitoring and local level coordinations. SCAs were part of the committees.

2. The Government through the APEX Committee, approved the service charges that CSCs would charge from citizens for services. Some departments objected to the charges considering the fact the Govt was obligated to offer such services free of cost. The charge to citizens was explained as service charge being paid to the CSC and not to the Govt.

3. Dept of Rural Development and Panchayati Raj offered space for CSCs in Panchayat bhawans at a nominal rent of Re 1 and all CSCs were authorized to be located in Panchayat Bhawans or other Govt buildings.

4. Projection of CSCs as the only channel for delivery of Govt services in panchayats and elimination of all additional channels.

5. Regular and repeated communication to all Districts regarding the concept, vision and planned way ahead.

6. Policy of non-interference in SCA – VLE business model. SCAs were given the liberty to set up viable CSCs and Govt acted as the facilitators with the responsibility of enabling the ecosystem and services and paying revenue supports.

7. Regular meetings of the Empowered and APEX committees and taking regular approvals for smooth implementation.

8. State approved setting up of urban and semi-urban CSCs at ZERO revenue support so as to cater to requirements of urban citizens. Urban CSCs were engaged in activities such as E-filing of VAT returns, Financial Inclusion, AAdhar PEC, Registration dept services, E-payments etc, thus enabling good footfalls and catering to local requirements.

9. Strict monitoring of deliverables as per MSA by way of monthly meetings, weekly reviews and regular communication between all stakeholders. Despite release of revenue support to it, the poor performance of M./s Zoom Developers led to its termination.

10. Provisioning SWAN to all feasible CSCs for intranet based services. 11. Coordination with BSNL for WiMax connectivity at CSCs. GoI funds for the same

promptly released to BSNL. 12. Identification of available services and introduction of innovative services for citizens and

Government based on the need and irrespective of the mode of delivery. E-nagarik sewa, a hybrid mode of issuance of certificates was started in 2009. Despite all the manual components, it slowly made the Govt offices ICT ready and the impact was seen in the successful implementation of the E-district pilot in Ranchi.



13. Merger of various MMPs such as E-district, E-panchayat, Commercial Tax etc with the CSC project as the delivery channel.

14. Elimination of smart card / POS model of Financial Inclusion and mandating CSCs as the disbursal outlets for all Electronic Benefit Transfers. By doing so, the State eliminated the cost of smart cards and POS that was being incurred and the kiosk bank model flourished at zero cost to State. The biometric authentication being done in the kiosk banking model eliminated a large nos. of unaccounted beneficiaries. Besides, the disbursal got ready for the Aadhar platform. Additionally, CSCs got a new stream of earnings.

15. Introduction of the E-wallet mechanism in major services thus enabling smooth flow of offset amounts from the CSCs to the SCA and SDA. As a bonus, the transactions through the wallet got reflected on E-Taal and thus created a platform for transaction based assessment of CSC operations.

Despite the above, problems and issues have existed. But the proactive approach of the State and its commitment to crating a viable network of CSCs enabled it to adopt corrective and innovative means of overcoming most of the issues. The issues may be listed as follows:

1. Although a PPP project, the partnership approach is only limited and the State always seems to impose upon SCAs. SCAs work on a market driven business model, but the State still tries to put in its priorities. Instead of the focus on citizen convenience, VLE interests seem to gain importance.

2. The entire rollout and revenue support related complexities came out of the unrealistic rollout timelines and uncapped penalty provisions of the MSA. SCAs continued working without revenue support for 4 years (2008 - 2012) after which, they agreed and the State redefined the rollout timelines. Had these been left to the State to define and finalize, it would have been more practical and the complexities would not have come up.

3. Although the State, SDA and SCAs signed agreements in April 2007, regular directives kept on being sent by DeitY and practical changes kept on being made in the implementation phase. Many of the directives were adopted in some states while many States did not. Appropriate modification in agreements did not happen and legally, the agreement terms would prevail if the SDA – SCA come into a dispute.

4. Despite the proven track record of BSNL, DeitY funded it to provide WiMax to all CSCs. Jharkhand too disbursed an amount of Rs 6 cr to BSNL for WiMax but results have been very poor. Besides, based on DeitY communication, SDA in Jharkhand directed all SCA to avail the Wimax from BSNL failing which revenue support would not be considered. Connectivity remained the main issue in the three years that have passed and BSNL still remains in the same sorry state of affairs. Had DeitY provided the same funds to SCAs, better newtworks could have been established.

5. The SDA in Jharkhand had a clear vision of the project and had plans for creating a viable channel which would have continued viably even after the GoI funds exhausted. By maximizing the services, by making CSCs the nodal delivery points in panchayats and by



adopting the offset mechanism, it was expected that CSCs, SCAs and SDA would be making good revenues and would be able to continue even in the non-revenue support period.

6. Although the changes at the top of the pyramid in Jharkhand happened, the project was luck to have most of the Heads as Champions. As the State Anchor / Project Consultant was the nodal knowledge transfer person and was continuously available for 7 years, there was no loss of signt of the vision and plan. Thus things moved in the same direction and progressed. But the involvement of people down the line was very poor and partisan approach prevailed. The Champion’s approach prevailed and project kept on being directed from the top.

7. The normal tendency of the government functionaries to gain authority and evade responsibilities is clearly visible. SCAs being the recepient of revenue support became easy targets as SDA started its efforts to impose and claim its authority.

8. The support of the field functionaries responsible for delivery of services has also been a major concern. Despite repeated State directives, a service as simple as e-Nagarik could not be implemented in about 70 of the 260 blocks. VLEs were used and connivance of Block officers and VLEs led to malpractices. Non-compromising locations were denied services. Officers also seem to be unconcerned about the sanctity of their authoriry and the importance Govt issued documents. In many cases, issuing officers share their DSCs and portal credentials with VLEs creating a very insecure and illegal environment.

9. Making CSCs the mandatory outlets for service delivery, a nearly monopolistic atmosphere is being created. While this is a good start, Govt should be aware of the tendency of people to use monopolistic atmospheres for personal gains causing inconvenience to the beneficiary.

Despite all these issues, the project in Jharkhand seems to be well on tracks. The test would be now when the rollouts are complete and the only deliverable is the uniform and mandatory use of CSCs in all ICT driven services. The platform is ready. Assessment of transactions at CSCs, benefits to citizens, awareness generation, motivating and rewarding good performers (VLEs, SCAs and Depts), good and viable returns to all stakeholders are the basic criteria that will have long term impact and sustained existance of the CSC channel.

But there has to be a slow but gradual transition towards an open atmosphere where all citizens have options to avail self-service facility or to seek assistance of VLEs in availing services at CSCs in case IT literacy or technology are the issues, but that should be the citizen’s option and not a compulsion.

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