eHealth Centre (eHC) in Action

The eHealth Centre is receiving tremendous response for its on-ground efficacy.

A video of the eHC is on youtube at the following link :

http://www.youtube.com/watch?v=Tk2HABWop9g

 

Taxation Policies affecting the growth of domestic Indian IT Industry

Taxation Policies affecting the growth of domestic Indian IT Industry

Co-authored with Arijit Sen and Parminder Singh

Background

One of the alarming implications of India Tax system that is crippling manufacturing of Information Technology products in the country is the Inverted Duty structure. The present rates of SAD in Information Technology components increase the cost of a finished computer or laptop that is manufactured in India as compared to a direct import due to an inverted duty structure. Most components of computers like motherboards, cabinets, memory modules, graphic cards attract a CVD of 10.3% and a SAD of 4% leading to an effective duty of 14.73% as against 10.3% CVD for finished goods.  On some components like microprocessor, hard disc drive attract 5% CVD and nil SAD.

The total input duty on components is higher than the output duty on the finished product or duty on imported Finished Goods. The higher duty directly leads to a higher cost for manufacturers in excise exempt zones as such manufacturers cannot claim offset of input tax against output tax. For manufacturers in DTA areas, there is overflow of input credit due to higher input tax versus output tax which again adds to the cost.

IT companies that have established large manufacturing facilities in India that manufacture information technology hardware like desktop and laptops are operating at only fraction of their capacities. The low production in turn leads to further higher manufacturing cost.

The inverted duty handicap for IT manufacturing Industry has turned down the morale of other component manufacturers who want to set up their manufacturing base in India despite notification of incentives and schemes for IT manufactures including M-SIPS and National Manufacturing policy.

Impact of CVDs on imported finished IT products on Domestic IT manufacturing

Countervailing Duty (CVD) levied under section 3 (1) of the Custom Tariff Act is equal to excise duty levied on a like product manufactured or produced in India. If a like product is not manufactured or produced in India, the excise duty that would be leviable on that product, had it been manufactured or produced in India is the duty payable. If the product is leviable at different rates, the highest rate among those rates is the rate applicable. Such duty is leviable on the value of goods plus basic custom duty payable. If CVD on imported finished IT products is equal to excise duty levied on a like product manufactured or produced in India, it brings the cost of imported PCs on par with locally manufactured ones. Current rate of CVD on imported finished IT products is 10.3% which is equal to the excise duty levied on manufactured IT products in India.

Impact of CVD on imported components on Domestic IT manufacturing

Domestic manufacturing is impacted by the CVD on imported components. Even if PC manufacturers  absorb the cost, a negative impact on pricing will exist between the imported and locally manufactured product. The current rate of CVD on most components of computers like motherboards, cabinets, memory modules, graphic cards is 10.3%, whereas the current rate of CVD on some imported components of computers like Microprocessor for computer, other than motherboards, Floppy disc drive, Hard disc drive, CD-ROM drive, DVD Drive/DVD Writers, Flash memory and Combo drive is 5.0%

Factoring in the Special Additional Duty (SAD)

Special Additional Duty of Customs is imposed at the rate of 4% in order to provide a level playing field to indigenous goods which have to bear sales tax. The current rate of SAD to specified parts of personal computers viz., Microprocessor for computer, other than motherboards, Floppy disc drive, Hard disc drive, CD-ROM drive, DVD Drive/DVD Writers, Flash memory and Combo drive is 0.0%, while the current rate of SAD on most components of computers like motherboards, cabinets, memory modules, graphic cards is 4.0%

Burden Imposed on Manufacturers by the Present Duty Structure in India

The present rates of CVD and SAD increase the cost of a finished computer or laptop that is manufactured in India as compared to a direct import due to an inverted duty structure. Most components of computers like motherboards, cabinets, memory modules, graphic cards attract a CVD of 10.3% and a SAD of 4% leading to an effective duty of 14.73% as against 10.3% for finished goods.  On some components like microprocessor, hard disc drive attract 5% CVD and nil SAD.

The total input duty on components is higher than the output duty on the finished product or duty on imported Finished Goods. The higher duty directly leads to a higher cost for manufacturers in excise exempt zones as such manufacturers cannot claim offset of input tax against output tax. For manufacturers in DTA areas, there is overflow of input credit due to higher input tax versus output tax which again adds to the cost.

As a result, IT companies that have established large manufacturing facilities in India that manufactures information technology hardware like desktop and laptops are operating at only fraction of their capacities. The low production in turn leads to further higher manufacturing cost. This in turn has turned down the morale of other component manufacturers who want to set up their manufacturing base in India.

Proposed Fiscal Policy Changes to Achieve the Manufacturing Goal of the Government of India

The Indian government recognizes that for India, it is a must to increase the share of manufacturing in the nation’s GDP to at least 25% and create opportunities for approximately another 100 million citizens who will be joining the work force by 2020. As such, from a taxation perspective, a clearly defined policy is required that allows existing mother plants to be able to operate at their full capacities with  support from Government in terms of being deemed as Brownfield Clusters and given MSIP benefits that the government has outlined through the triad of policies in 2012. This will boost the investment sentiment of other component manufacturers to invest in India. Once the mother plants are operating at full capacity, the Government needs to engage with component suppliers so that a sustainable component eco-system is created in the country.

Specific tax policy changes that would promote domestic manufacturing in India

1)     Exemption from CVD on 7 components of Computer - microprocessors for computers other than motherboards, floppy disc driver, hard disc drive, CD ROM drive, DVD drive / DVD writers, flash memory and combo drives meant for fitment inside the CPU or laptop, etc which is an additional cost to manufacturers of IT goods in Uttarakhand.

2)     Removal of SAD on other components that attract CVD of 10.3% and SAD of 4%, as duty on components is than duty on finished goods for manufacturing units based in Uttarakhand.

3)     No additional tax burdens on any of the components of IT manufacturing in order to prevent Duty Inversion in DTA zones.

e-Benefits in e-Governance

http://www.youtube.com/watch?v=n1y7DY9yRnk&feature=player_embedded

The Issue of Internet Governance

The Internet is a critical socio-economic enabler, which has deep impact on the economy, social order, law and order and the fabric of the nation itself. Its impact is only going to amplify as we move forward, especially when things start getting connected to each other and when the next generation of the Internet, IPV6 enabled Internet, starts getting rolled out. It would imply that your automobile can get connected to the cloud computing facility of the manufacturer for automatic analytics of the health of the automobile.

As per some estimates (refer note on Internet Governance at IIGF, New Delhi), the number of Internet-connected devices globally crossed 6 billion in 2011, and is expected to reach 15 billion, twice the size of the world’s population, before 2016. More than 6 billion mobile phone subscriptions are in use today, and the number is expected to cross 8 billion by 2016.  Mobile data traffic reached 597 petabytes in 2011, twice the amount of 2010, and is estimated to cross 10 exabytes by 2016. Broadband subscribers, estimated at 1 billion in 2011, are forecast to grow at 40% per annum, and reach 3.5 billion in 2016. As a large part of the growth is to take place in the developing countries of Asia, India can be expected to be a major component and beneficiary of this growth trajectory.      

The Internet started as a means of sharing information amongst scientist working in different institutions. From that, it is becoming – if not already become --the communications backbone of the world. It is a major economic driver, provides banking and other financial services to world’s business, provides a global market place and is replacing the conventional print and visual media. Internet is now ubiquitous in today’s world. Cutting off an enterprise or a country from the internet would have severe consequences.

 

This of course immediately also brings out the dangers that are emerging in such an interconnected world. The Internet can be used to bring down the telecommunications network of different countries, its banks and even its’ power grid. In Iran, we have seen the use of cyber weapons by the US and Israel taking out physically 10,000 centrifuges. If this had been done using a missile, it would have been considered an act of war. How should we then look at the Internet – also as a strategic space which then country’s need to protect? (ref. http://newsclick.in/india/internet-governance-and-itu-issues-baku-and-dubai by Prabir Purkayastha)

Therefore, a clear governance structure for the Internet, that is aligned to the long-term growth of the Internet and that is aligned to the interests of the economy and national security, is necessary for a healthy socio-economic functioning of a modern economy.

Internet Governance includes, but is not limited to, the following key issues:

[I] infrastructure and management of critical internet resources, including administration of the domain name system and Internet protocol addresses, administration of the root server system, technical standards, network neutrality, and multilingualisation;

[ii] issues in the use of the Internet, including spam, network security and cybercrime;

[iii] issues of wider impact such as Intellectual Property Rights [IPRs], freedom of expression, data protection and privacy rights, consumer rights and International Trade; and,

[iv] developmental aspects, in particular, capacity-building.

From a socio-economic perspective, it impacts issues such as sovereignty over the Internet/ Free usage of Internet and interconnects, issues of Transborder data exchange and therefore its impact on Cloud Computing, issues of Data protection, the freedom of Internet, privacy, cyberwarfare and the issue of  global ban on use of Cyberweapons and cybersecurity.

Under the existing system of Internet governance, the International Corporation for Assigned Names and Numbers [ICANN] performs two principal functions:

(a)   The Internet Assigned Names Authority [IANA] function whereby it controls entries to the authoritative Root Zone File of the Internet

(b)  The management of the Domain Name System [DNS] and the allocation of Top Level Domain [TLD] names.

The function of allocation of TLD has been recently renewed as a perpetual contract, known as the Affirmation of Commitments between ICANN and the US Government. The IANA function has also been renewed for a seven-year period beginning 01 October 2012. The IANA function is overseen by the National Telecommunication and Information Administration under the US Department of Commerce. Technical standards are set by the Internet Engineering Task Force [IETF]. The central elements of the Internet's logical infrastructure, also called Critical Internet Resources, thus continue to be managed by private entities such as ICANN and IANA under contractual arrangements with the US Government (refer note on Internet Governance at IIGF, New Delhi.)

 

The United Nations established the Internet Governance Forum (IGF) in 2005 to discuss the issues of Global Internet Governance. However, UN/IGF does not have the organisational structure or the mandate to agree on decisions and the enforcement mechanism to implement them.

There is therefore an urgent need to bring in participation by Governments, especially from the developing countries, in order to establish a multilateral, transparent and democratic Internet governance mechanism that functions with the full involvement of Governments, the private sector, civil society and international organizations, without according a pre-eminent role to any single Government or organization. Government of India is hence rightly formulating the policies for engaging in the reforms process required for a global participative Internet Governance structure.

Imperatives for an Innovation Agenda

Imperatives for an Innovation Agenda in India  

 

In the fiscal year 2011, the number of applications for patents filed in India rose to 37,000 from 34,000 in the previous year. Now consider this—of these applications, 80 per cent came from outside India.

 

Even as India continues to make its mark as a ‘knowledge’ economy, the creation, application, commercialization and protection of knowledge—all need more work before India can be at the forefront of innovation in the world. Above all, there needs to be a national agenda for innovation, which penetrates down from policy to the individual user.

 

Before we delve into the strategy for innovation, let us see why innovation is pivotal to the country’s growth. Just 15 years ago, there was no World Wide Web or profusion of dotcoms and social networking platforms, no ubiquitous cellphones, no sequenced genome and no carbon nanotubes. Science and technology have been advancing in the past couple of decades, making people smarter and more capable every day. The internet has become a democratizing force today and globalization is a dominating reality. Both as a cause and consequence, it is inevitable for individuals, organizations and nations to innovate. For India specifically, innovation is critical to ensure that gaps between the oft-mentioned ‘two Indias’ can be narrowed and economic and social growth is more inclusive.

 

By finding more efficient ways to work, innovation can reduce cost and increase revenue. By finding simpler, more convenient and even aesthetic solutions, innovation can help enhance a citizen’s quality of life. Innovation places the information and communication technology (ICT) industry centre-stage, making it an engine of the knowledge economy.         

 

Learning from other countries

When it comes to policy, the US, UK, Europe and China are some of the leading examples of nations with clear innovation agendas outlined.

 

In the UK, the existing framework under the Department for Innovation, Universities & Skills (DIUS) has been performing well, especially on the lifelong learning and early-stage venture capital front. The Innovation Nation White Paper outlines the future of innovation in the country, providing intellectual leadership by suggesting new policies based on new imperatives. Highlights include provisioning for ‘hidden’ innovation and demand-driven ideas and fostering collaboration between public, private and non-governmental organizations (NGOs) to transform public services. Aside from this, it stresses on reforming the Small Business Research Initiative (SBRI) and incentivizing enterprises with investment and expertise to convert research into innovation. To prepare the next generation of innovators, it recommends getting educational institutions to emphasize on STEM (science, technology, engineering and mathematics).

 

The US, recognizes a vision and strong culture of innovation, and more importantly, successful commercialization of innovation in the country. The National Innovation Initiative (NII) outlines the next phase in this journey, focusing strongly on the three pillars of talent, investment and infrastructure. In both, the US and the UK, there is recognition of the fact that the focus of research is skewed towards certain sectors—health science and defence in the former and pharmaceuticals and aerospace in the latter. There is, therefore, a conscious move to even the playfield for innovation in all sectors.

 

The European Union (EU) stresses on innovation at both the Union level as well as the regional level. For Europe 2020, the three priorities identified include smart growth, sustainable growth and inclusive growth. The EU’s Innovation Policy places strong emphasis on social innovation, recognizing it as “an important new field which should be nurtured.” The Policy suggests creating a virtual hub of social entrepreneurs and supporting them with a European Social Fund (ESF).

China has been a strong science and technology innovation player. The Organization for Economic Co-operation and Development (OECD), along with the Ministry for Science and Technology have been reviewing the policies for innovation in the country and have come up with gaps that we, in India, would be quite familiar with. As its medium and long-term objective, China wants its dependence on foreign technology to reduce by 30 per cent and be among the top five countries in the world in terms of domestic invention patents granted, and the number of international citations of its scientific papers.

 

Imperatives for India

The innovation strategy for India needs to have four very clear objectives—enable innovation at the bottom of the pyramid (for and by the next billion), create an innovation ecosystem, focus on local capabilities for both near- and long-term benefits and harvest existing innovations so that the benefits reach a larger potential user base. This quadri-focal strategy is outlined in the figure below:

 

Even as the near-term benefits spark immediate interest, the long-term vision needs to be on creating a culture of innovation. And even as we invent solutions at the institutional level, we need to create a nurturing environment for innovations developed at the individual and grassroots level.

 

The four types of innovation need an organization created to identify and seed ideas to harvest them. Budgets need to be created to support innovations and interfaces evolved with other government agencies, the private sector and academia to foster them. To build the environment for innovation, the strategy needs to address the following factors:

 

Ensure research converts to innovation: Research is integral to innovation, but it doesn’t end there. For research to convert into meaningful innovation there needs to be a three-way understanding between the public sector, the private sector and the academia. Collaboration between industry and labs, creating a framework for jointly-funded research, creating a functioning lab-less research capability that leverages the existing facilities in the private sector, universities and the government itself, and ensuring feedback for research are the other important factors to keep in mind. What is most critical, however, is to ensure that research is done with a focus on the market and to ensure that the research is commercialized. Such research-to-commercialization cycles will get enabled if there is industry partnership in setting the research agenda. For a country like India, if it doesn’t lead to viable, accessible, affordable solutions to real problems, then the innovation agenda is inappropriate.

 

Create a strong legal structure: The intellectual property rights (IPR) ecosystem is a minefield that needs careful navigation coupled with a sturdy framework. For innovation to truly prosper, it is important that the IPR of all solutions and innovations are legally protected. One of the biggest concerns for small entrepreneurs and individual inventors is that they don’t know enough about existing IPR and end up inadvertently infringing on them or losing their IPR to larger corporations. These entrepreneurs need specialized legal and IPR support even as they are being incubated. Small enterprises and individuals need to have access to online IPR systems so that they can protect their IPR. Such systems should include online patent filing. Above all else, though, this is an area where awareness levels are extremely low. As we move towards an era where no new IPR can be created without requiring support from existing IPRs, there needs to be a concerted effort to educate people on IPR and make IPR a part of regular curriculum. For instance, perhaps IPR education should be part of engineering courses and be taught even at school level.

 

Enable business partnerships and incubation: The gap between idea and adoption is filled only by the successful commercialization of research. For this, there need to be strong linkages between research and industry. The industry, with its in-depth understanding of the market and resources that can help bring innovation to market, can help take the innovation to its logical conclusion. This can be through direct or indirect involvement. An organization could support incubation through new and existing qualified entrepreneurs, support technology acquisition through buy-outs, or even have summer-break programs for potential student entrepreneurs to work on their ideas. Institutions like HP Labs offer opportunities for talent to be nurtured and ideas to be incubated. However, in today’s complex world of technology, new innovations cannot thrive without access to existing IPR.  Therefore, to spur innovation, it is critical to provide access to IPR related to existing innovation. This can be through outright purchase of technology, patent swapping, buy-outs of relevant companies through government-sponsored industry consortiums, commercial arrangements where patents can be freely used or a combination of these techniques.

 

Encourage community participation: Inventions like jugaad are examples of demand-driven responses. Jugaad maximizes asset utilization by reusing the same pumpset that helps in irrigation, to also power the cart that helps take the farm produce to the mandi and provide locomotion to the villagers, thus optimizing the economy as a whole and making the local economy more efficient. In fact, jugaad is a symbol of community-driven innovation.

However, it is also a perfect example of how our policies stifle innovation. As per the Central Motor Vehicles rules, jugaad is illegal. Not only is jugaad illegal, there have also been no steps taken to introduce this innovative solution to other parts of the country such as the south or the east, thus depriving them of the benefits from this innovation. Innovation would get a huge leg up if government facilitates innovation and if one were to engage, besides research scientists and engineers, rural citizens, individual innovators, academicians, CXOs, government bureaucrats, district level officials and others. This engagement has to happen both, bottom up, for ideas to be harnessed on a larger platform, as well as top-down, to ensure a broader outreach for innovation, through a consciously created conducive environment and not just through serendipity. Conferences, workshops, awards, and other events are some of the ways to engage with the community to create a mass base for innovation.

 

Develop policies to incentivize innovation: There are three requirements on the policy front for innovation—formulation of appropriate strategies for promoting technological development, identification of trade and fiscal measures to encourage technology development, and developing of a framework for standardization, certification and accreditation.

Innovation needs a fertile environment where it can take roots. Incentives in the form of capital investment, finance and favorable taxation are critical. There also need to be policies for the government to enable procurement of innovation. Current procurement policies disincentivize innovation. Technology and IPR framework, availability of a talent pool and better access to market are all necessary to foster innovation as well.

Innovation, ultimately, thrives in an environment where there is high accessibility to technology. Democratization of ICT can go a long way in ensuring a platform for greater collaboration and also catapulting India to its rightful place at the helm of global innovation.

 

India offers a unique chance and a ready testing ground for new initiatives and services. Innovation aimed at inventing for the next billion will be most critical to develop, because that will help narrow the divide between the haves and the have-nots in the Indian state. The proposed US $5 billion India Inclusive Innovation Fund[1], to be launched by the Indian government later this year, is a step in the right direction. Innovation, however, will always be driven by people’s creativity and enterprise. And that’s what policy makers need to nurture.

 

 

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[1] http://www.innovationcouncil.gov.in/index.php?option=com_content&view=article&id=107:government-plans-rs5000-crore-india-inclusive-innovation-fund&catid=14:news&Itemid=13

eGov 2.0: Policies, Processes and Technologies (Book Launch)

Launch of the book by the Honourable Minister for Communication and Information Technology, Shri Kapil Sibal: http://www.youtube.com/watch?v=arfBOzvMlMk&NR=1&feature=endscreen

Book Review: http://egov.eletsonline.com/2012/04/e-governance-matters/

Governance in large countries such as India, Brazil, China, Indonesia etc face many challenges. These challenges are compounded by the fast changes brought in by globalization and by increasing expectations of the citizens.

To begin with, citizens are expected a greater say and a greater direct participation in governance. Citizens have seen how their voices have forced businesses to be more customers friendly but frustratingly, citizens find that their voices are completely lost to the government. In order to effectively meet these challenges there is needed a strong centralized administration support system supported by IT.

The adoption of IT by governments has typically been viewed as a four stage phenomenon, starting with the publish stage, the transact stage, the interaction stage and the integration stage. However, there has been a plethora of changes in technology, legislations and business models that has led to a new paradigm emerging in e-governance, which has been termed as eGov 2.0 and described in the book E-Gov 2.0: Policies, Processes and Technologies. It is the only known book on e-governance which describes high level policies and case studies as well as systematically walks through the policies, technologies, implementations and domain knowledge. eGov 2.0 is defined as an evolutionary step towards a more efficient, inclusive and participative government through adoption of a set of new trends in business models, operational models, financial models and technological models.

Governments should be more dependent on services for revenue generation rather than on taxes which is implied by the Concept of Service Oriented Administration or SOA. The monopolistic situation of the government gives it enormous revenue generation capability through providing services. For example, if the government provides an online land exchange, it can get the 1% service charge that is typically charged by brokers. In addition, it would help in increasing the number of transactions. Similarly, the online second hand vehicle sales system would not only reduce the number of stolen cars sold, but would also generate considerable income for the government. It is estimated that at commission of USD 100 per car sold and USD 10 per two wheelers sold, India can generate over USD 2 billion every year. There can be many such SOA initiatives that can be enabled through eGov 2.0.

The book e-Gov 2.0: Policies, Processes and Technologies is aimed at for people involved in conceptualization, planning and execution of e-governance projects. The book discusses the aspects to be borne in mind for embarking on the path for transformation to e-governance. How to leverage power of IT for providing solutions for effective e-governance in the present day context? Why cannot the e-Governance solutions help in direct participation of Citizens in the business of governance? Why cannot the 100,000 Common Service Centers take polls of people's views on each bill that is passed? Why should the government be largely dependent on taxes as its source of revenue when it has tremendous amount of data that can give it access to new monopolistic businesses? Why cannot we have revenue from e-Public Services? For example, setting up of a property exchange in lines of the stock exchange will not only bring in very high liquidity in the land market and help increase the GDP of the country but also bring in substantial revenues to the government that is currently going to middlemen in an imperfect market, with many a transactions landing up as civil cases in the already clogged court system.

Similarly, why cannot we have an online vehicle exchange system for second hand vehicles that will not only bring down the number of stolen vehicles sold but will also bring in substantial revenues for the government? Same is the case with setting up a mobile phone tracking system, number portability systems etc. Some of these systems will have fundamental enabling impact of new institutions such as the micro-finance institution.

eGov 2.0 will usher in greater citizen participation and will have tremendous uplifitng impact on the economy. Not only will it make the government more efficient by cutting out the non-value added processes but will also increase the efficiency of government's interface with the citizens, businesses and other institutions. It would also enhance the interactions between various stakeholders in the society by intelligent usage of ICT.

However, eGov 2.0 will fundamentally be a realization that the form and substance of governance needs to be changed radically. ICT will act merely as a tool and an excuse to bring in this change. The forces bringing in this change is basically people's expectations of governments delivering more from less and that service delivery needs to be personalized to such an extent that it not only serves micro-communities but perhaps is tailored to the requirements of individuals.

At the end of the day, eGov 2.0 will make people happier and bring the government's closer to Chanakya's statement in “The Wealth of Nations” that in the citizen’s happiness lies the happiness of the King.

IT enabled Land and Property Exchange

The principle of Keynesian economics and free market that information can be freely available is not valid in case of land and property in India

The issues of urban governance can be highlighted with the case study of Karnataka where multiple urban systems have already been implemented. Technology is opening up new models of governance including new business models for government, operational model, technological model and financial models which are leading to participatory governance.

One such area where these models are used is in land records. Increase in efficiency of land and property records will have considerable impact on GDP of the country. Primary source of income in rural areas continues to be agriculture. Some issues of land and property transactions are that it is broker driven, there are significant brokerages and manipulations because there is no transparency of information. There is non transparent market, distress sale and purchase which also lead to manipulation of prices. There is very limited liquidity and it is difficult to encash particular wealth. Finally we have deed based system rather than title based system which means that property can be sold multiple times based on deeds. In Karnataka, land records are mentioned in a dead language which have to be kept because new deeds have no value. Globally, people are moving towards title based system which is if the land is in a person’s name he owns it irrespective of what the previous deeds are. Between the time of registration and actual mutation, the land could be sold to many people as the registration system does not go and check whether property is sold or not. Registration and mutation are independent.

There is Sarfaresi Act which keeps track of all assets for which loan has been taken. It ensures that new urban property follows the system because much of the old properties are embroiled in the issue of whether the deed is clean or not, whether there are competing claims on land, and so on.

In Karnataka, land property records and management system works by three sections. One is land records which is responsible for managing ownership and rights, ownership records of non- agricultural land and property. Second is registration section which is registering all transactions taking place in land and property in public record. Third is service section which is managing spatial and non spatial data about land.

There are two kinds of properties- agricultural and non agricultural urban property. In urban section there is a request for pre mutation sketch done by urban property ownership record system. Then it goes to registration system Cauvery which is where you pay taxes and then it goes to Bhoomi system where mutation happens. Essentially, the four major steps are: agreement to sell is reached without the sale deed; the seller and buyer get together through a broker; pre mutation sketch is made; it is then brought to registration or mutation system. Same is the process of sale deed and detailed process of how mutation is done. All this is converted to online system.

There is a lot of pressure on the legal infrastructure because of large number of civil suites that  are based on land records. As per one estimate, 70 percent of cases in Indian courts are related to land and property issues. The Bhoomi project and reforms improved the quality of land records. But it is still built on a foundation which is very archaic, laid down by the British focussing more on revenue collection and in providing governance. Therefore, land and property transactions continue to be a significant source of litigation in courts.

It also has significant socio- economic impacts. The sub-optimally governed land and property system leads to considerable hardships for rural and urban citizens. Moreover, it leads to family disputes and impacts the well being of the citizens. Support system is critical to facilitate land acquisition system for developmental projects at appropriate rates and compensations.

At the end of the day, the benefits are that one gets service/tax oriented administration. If government starts looking for providing services and getting revenue enhancements because of the service provided, that would increase the revenue collected by the government. As the transaction hassles goes down, the number of transaction goes up and in turn tax and revenue collection goes up significantly. At high level we need to train people, legislative and administrative changes, and training of owners, how to manage digital signatures and digital ownership of land.

The major legislative changes that are required are three rights that government should grant- apriory right to owners to sell their property without any objections; buyers to qualify on terms such as eligibility to buy agricultural property apriory right to buy land; automatic mutation of property after a certain period