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Blockchain & its utilisation in Public Digital Infrastructure

  • Category
    Polity & Governance
  • Published
    9th Dec, 2022

Context

The digitization of governance is led by the Government, which is least automated for using services and is affected by the Pandemic, Russia-Ukraine War, and the economic slowdown.

  • The digital infrastructure is a public good and must be governed by government agencies for ensuring accountability.

About

The Blockchain Technology:

  • The blockchain is a ledger maintenance technology that keeps track of every change to your digital data and renders it individually purposed, always verified, non-tamperable, and shareable.
  • Because such a ledger is verified, it does not require a third party to authenticatethe data presented every time you present your digital data into an application.

Digital Public Goods are open-source software, open data, open AI models, open standards, and open content that adhere to privacy and other applicable laws and best practices, do no harm by design and help attain the SDGs.

What is a Public digital Infrastructure (PDI)?

  • PDI refers to solutions and systems that effectively provide essential society-wide functions and services in the public and private sectors.
  • This includes digital forms of ID and verification, civil registration, payment (digital transactions and money transfers), data exchange, and information systems.
  • They are open-source, customizable, and localizable.
  • Benefits:increase resilience, avoid vendor lock-in, leverage existing solutions and adapt them to local needs, support interoperability between different platforms and solutions, and have the ability to respond swiftly and effectively to global crises.

Using Blockchain as PDI:

  • Public Digital Infrastructure (PDI) on the blockchain is built on the digitized data registries shared on it publicly without violating data privacy or private use. Applications built on this infrastructure will enable ease of governance, making it transparent and responsive.
  • This will also unleash the potential of the technology start-up ecosystem to create new governance and social ecosystem applications for the world from India.
  • Possible applications:
    • Government benefits like cash transfers are supported by foundational DPI.
    • MOSIP has been used for pandemic-related subsidy payments
    • It is an open-source identity platform that can then be used to access a wide variety of government and private services.
    • MOSIP allows national identity systems to be context-specific and based on local laws and decisions
    • MOSIP is representative of the adaptable, interoperable, and transparent qualities of DPGs
    • Funded by the Bill & Melinda Gates Foundation, Tata Trust, Omidyar Networks, and NORAD.

      Blockchain technology has been used as Public digital infrastructure by the Philippines, Morocco, and Togo, and piloted in Sri Lanka, Ethiopia, and Guinea.

Major advantages of using blockchain in governance:

  • Transparency: Blockchain allows traceability of information and ensures nothing is unduly modified. This is a big advantage in enhancing democratic governance and adds accountability.
  • Data protection: Blockchain allows users to own and control their data through private and public keys. The owners also decide when and how a third party can access this information.
  • Improved efficiency: The technology eliminates go-betweens from the process and reduces the risk of human errors and time consumed in hierarchical approvals.
  • Manpower requirements: Blockchain will significantly reduce the manpower requirements.

Blockchain Use Cases explored by NITI Ayog:

  • Land Records: Creating a new system to manage land record transfer and ownership
  • Pharmaceutical drugs supply chain: ‘self-regulation’ of the sector through blockchain enabled trust
  • SuperCert: Anti-fraud identity intelligence blockchain solution for educational certificates. It is creation of a block of student certificate – hashed version of the certificate on the blockchain.
  • Immunization Supply Chain: Building A New Immunization Infrastructure for India – Unified and Enhanced by Blockchain
  • Chit Funds: A blockchain based model to enhance trust and unlock value creation
  • Insurance (Medical, Automotive, etc.): A blockchain system would allow same-time access to the shared truth on patient health (past and present), processing status of the current claim.
  • EV Battery Swapping: Exploiting the ‘smart contract’ feature of blockchain applications would allow for more efficient swapping of batteries at charging stations.
  • Organic Farming: Placing information regarding the lifecycle of crops on a blockchain will help improving trust in the self-certification process and establishing traceability at the point of sale.
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