Government Information Quarterly 29 (2012) S82–S89

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Government Information Quarterly

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Fostering inclusive growth through e-Governance Embedded Rural Telecenters(EGERT) in India

Gopal Naik ⁎, Siddharth Joshi, K.P. BasavarajIndian Institute of Management-Bangalore, Bannerghatta Road, Banaglore, Karnataka, 560 076, India

⁎ Corresponding author. Fax: +91 080 26584050.E-mail addresses: gopaln@iimb.ernet.in (G. Naik), si

(S. Joshi), bas@iimb.ernet.in (K.P. Basavaraj).

0740-624X/$ – see front matter © 2011 Elsevier Inc. Aldoi:10.1016/j.giq.2011.08.009

a b s t r a c t

a r t i c l e i n f o

Available online 25 September 2011

Keywords:E-governanceTelecentersPublic private partnershipsICT

In the recent years, two significant changes have taken place in an effort to address rural poor: Businesses havestarted recognizing potential of rural markets and governments have started using telecenters for providingG2C services to rural citizens. In India, the national and sub-national governments have supported businessesto establish telecenters in rural areas to provide information technology enabled services. However, the focusso far has been mostly on B2C services and viability of telecenters is being questioned. We argue that sustain-ability of these centers can be enhanced considerably if government services are embedded. Also, designingthese telecenters with embedded G2C services would significantly improve effectiveness of their deliveryand strengthen government information network, to foster inclusive growth.

ddharth.joshi09@iimb.ernet.in 1 The terms telecehere onwards in the

l rights reserved.

© 2011 Elsevier Inc. All rights reserved.

1. Introduction

Recent discourse on development through markets and privatesector with emphasis on a development-through-entrepreneurshipmodel has been popularized by the concept of reaching the Bottomof the Pyramid (London & Hart, 2004; Prahalad & Hammond, 2002;Prahalad & Hart, 2002). The core argument is that private sectorshould target the vast, growing and largely untapped rural marketsin developing countries with low-cost services and appropriate busi-ness models. According to the advocates of this approach, increasingthe well-being of the poor while enlarging the opportunity for theprivate sector provides a win–win proposition for both. Last decadehas also seen a marked increase in the number of projects in develop-ing countries that use information and communication technologies(ICTs) for social, economic, and political development (Toyamaet al., 2004). A large number of these projects aim at bringing the ben-efits of ICTs to communities where individual ownership of com-puters is low and use of the Internet is infrequent (Best & Kumar,2008). This trend illustrates the high and ever-increasing expecta-tions placed on ICT in terms of bringing about improvement in qualityof life, empowerment and economic development for the rural com-munities (Hosman & Fife, 2008). The prevalent method of reachingout to rural areas in these projects has been telecenters (Heeks,2008) which provide shared public access, often intermediated byan operator, to information and communication technologies and ser-vices via computers and the Internet. Initial efforts in setting up of

these telecenters or Common Service Centres (CSCs)1 in India arebased on a variety of models ranging from fully public projects suchas Gyandoot by the Government of Madhya Pradesh, India, to whollyprivate projects such as ITC's E-Choupal.

1.1. National e-Governance Plan in India

Recently the Government of India (GOI) has envisaged the Nation-al e-Governance Plan (NeGP) to set-up 250,000 telecenters or CSCs inrural areas with following objectives (Chauhan, 2009).

1. Making all Government services accessible to the common man inhis locality, through common service delivery outlets.

2. Ensuring efficiency, transparency and reliability of such services ataffordable costs to satisfy the basic needs of the common man.

The CSC Scheme is envisaged to be a bottom-upmodel for delivery ofcontent, services, information and knowledge, that can allow like-mindedpublic and private enterprises – through a collaborative framework – tointegrate their goals of profit aswell as social objectives, into a sustainablebusiness model for achieving rapid socio-economic change in rural India(GOI, 2010). The sub-national (state) governments while implementingthe NeGP have invited private service providers with terms and condi-tions mainly aimed at providing B2C services. The experience of the 23states implementing the initial phase of the plan with 90,000 CSCs hasnot been encouraging with many of them closing down (GOI, 2010).Many telecenters have been providing only peripheral services such asmobile phone recharge and music download — not considered criticalin fostering development. Experience of Karnataka state in India provides

nter, rural kiosk and CSC have been used interchangeably frompaper.

S83G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

useful insights in this regard. Karnataka, center for software industry inIndia, hasmany distinctions in using ICT for e-governance. Bhoomi, an on-line land record system, and more recently Bangalore-One, a project toprovide G2C services in cities, are prime examples. In 2007, Departmentof Revenue, Government of Karnataka (GoK) set up 764 Nemmadi2

centers in rural areas throughout the state to provide G2C services via aPublic Private Partnership (PPP) model at Hobli3 level. The governmentprovides access to its database and authenticates the certificates issued,whereas private partner provides the logistics for issuing certificates.Now, GoK has decided to establish CSCs at gram panchayat4 level in partto fulfill the requirement of National e-Governance Plan of Governmentof India. Taking telecenters closer to people (from one telecenter for apopulation say 50, 000 to one for a population of 10,000) poses the prob-lemoffinancial sustainability of these centers. The literature on the finan-cial sustainability of these centers has drawn attention toward the needfor ways of stimulating demand for services among the local communitywith the argument often being made that this demand should bereflected in the community's willingness to pay for services (Harris,Kumar, & Balaji, 2003; Roman & Colle, 2002; Whyte, 2000). We forwardthis argument in this paper with the proposition that as the geographi-cal area and/or the population served by telecenters is reduced, finan-cial sustainability of these telecenters requires expansion of servicebasket, of which most crucial aspect is to embed government services(G2C and G2G5).

The rest of the paper is organized as follows. Section 2 describes ourmethodology and this is followed by a conceptual framework for finan-cial sustainability of telecenters throughwhichwe show that as telecen-ters cater to smaller populations, provision of a cluster of complete andintegrated services becomes critical for their financial sustainability andthat G2C services play a vital role in the proposed design. Section 4 pro-vides a discussion of how market creation can take place in rural areasvia telecenters followed in Section 5, by evidence of market creationbased on an action research project initiated to explore the financial sus-tainability of these CSCs at gram panchayat level, supplemented by evi-dence from Akshaya project in Kerala State in India. Section 6 discussesthe impact of service delivery through telecenters on the functioningof government at local levels. Finally, Section 7 concludes the paper.

2. Methodology

Ourmethodology is to first develop a spatial revenuemodel to arriveat a financially sustainable design for telecenters. To illustrate the mainarguments of the paper,weprovide data from twoprojects—Apilot pro-ject which includes 15 telecenters run at gram panchayat level in Tumkurdistrict in Karnataka State and the Akshaya project in Kerala State. Thedata on the pilot project was collected over a period starting Dec. 2010and July 2011. In Tumkurdistrict, interviewswere conductedwith femalestudents in secondary schools in 3 gram panchayat areas and data wascollected from these schools on the gender-wise break of students at-tending private tuitions. The data for two Akshaya centers in Trivandrumdistrict was collected during field visits made in July 2011.

3. Conceptual framework

Using a Spatial Revenue Model similar to the one used by Naik,Basavaraj, and Joshi (2010) we can represent the financial sustain-ability problem as recovering adequate contribution toward fixedcost. That is, denoting N as the number of households in an area, Sthe number of services offered by a telecenter or a CSC, pi and ci the

2 Nemmadimeans ‘deriving happiness by being hassle free’ in the local languageKannada.3 Hobli is an administrative unit comprising of 15–20 villages with a total population

of 20000.4 Village panchayat or gram panchayat is the smallest local government unit in rural areas

in India comprising of 3–5 villages with total population of approximately 5000–10,000.5 G2G services are defined as the transactions between governments at various

levels or various departments or agencies or bureaus of the government.

per unit price and variable cost, respectively, of providing a particularservice of type i to household j, and C as the amortized fixed cost, theCSC's financial sustainability requires

∑N

j¼1⋅∑

S

i¼1dij pi−cið Þ≥C

where, dij= f(pi,zij) is the quantity of services demanded at the tele-centers and is dependent on price, and other household specific fac-tors (zij), like per capita income, literacy levels, etc. and

∂di∂pi

b0;∂di∂zi

b0 or∂di∂zi

N0 dependingonwhatzirepresents:

As we reduce the geographical area served, the number of house-holds (N) decreases and the revenue loss has to be compensated for,with an increase in either S (number of services), di (demand for servicei), or pi (price of service i). Increase in pi is difficult as it has a negative ef-fect on the demand di, especially when the demand for services is elastic,as is the case for most of the services offered by CSCs, and factorsinfluencing demand other than price are external to CSCs. Thereforethe above equation makes it clear that as telecenters are rolled out insmall geographical area, the number of households that a center is serv-ing (N), decreases, which necessitates increase in the number of servicesto be provided (S) or increase in the demand by each household, di, orboth for achieving financial sustainability. This is particularly importantwhen the share of fixed cost in the total cost is high. The number of ser-vices that can potentially be delivered through a CSC depends on theneeds of the various stakeholders — citizen, government, and businessand technical feasibility of delivering those services in rural areas. Thevolume of services demanded would depend on the quality of the ser-vice, the price of the service as well as how integrated and completethese services are. For example, if CSCs are able provide informationabout a new agricultural technology, farmers would seek this informa-tion if the CSC is also able to provide information on the cost of technol-ogy, how this technology can be procured,financed and used. The farmerwill be further facilitated if there is also information about how the resul-tant product, say Bt cotton, can be marketed. Therefore, unless a largecluster of complete set of services is provided in an integrated manner,it will be difficult to sustain telecenters in remote areas. Since govern-ment is a major provider of several important services in rural areassuch as health, education, agriculture, drinking water, women andchildwelfare, etc. clustering, integrating and ensuring completeness of ser-vices in telecenters necessitates embedding services provided by thegovernment. Such e-Governance Embedded Rural Telecenters (EGERT)can, by functioning as information networks, facilitate improved flowof information between government and citizens leading to substantialdual gains. First, providing government services enables telecenters toprovide integrated and complete services, increases the trust of the citi-zens in the telecenters (Kuriyan & Ray, 2009) and increases the footfallsenabling cross-selling of services. Second, these telecenters can providegovernment services more effectively utilizing efficiency of the privatesector and thereby strengthen last-mile governance. Thus a sustainabledesign of telecenters needs to embed government services in order to in-crease the scope of rural service delivery as well as to improve effective-ness of their delivery for fostering inclusive growth.

4. Market creation by telecenters

Across the world, the percentage of poor that reside in rural areasis quite high and the rural poor frequently live in remote areas withsparse populations (Kenny, 2002). This implies that access to qualityservices for the rural poor is constrained by distance and high oppor-tunity cost involved in traveling to urban centers to avail them. In thissection, we argue that CSCs are particularly well placed in stimulatingdemand for services in rural areas and making them affordable.

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Demand can be created or increased by bringing the following char-acteristics to service delivery by the CSCs.

• Role of distance and convenience: Currently rural people are re-quired to travel long distances to avail certain services like tuition,English language coaching etc. The provision of these services at vil-lage level would not only reduce cost for the rural people, but willalso be more convenient. More importantly, the girl child can'tavail these services if the place is far off and/or timings are late inthe evening, whereas telecenters can provide access to these ser-vices to the girl child closer to her home.

• Reliability: As the services and information are provided at the village/community level andnot by aprivate company agent or salesman locat-ed elsewhere, people will trust the information and consider it reliable.The permanency of the centerwould also instill confidence in people asthey can follow up any problem with them. For instance, a contractfarming agreement through the CSC would be preferred by farmersover a direct contract with the company located in a distant place.

• Affordable cost: Once information becomes available and the ser-vices are profitable, there will be more private players offeringthese services. For example, once the content for educationalcourses has been prepared, it will become easier and cheaper forother players offering educational services to enter the market inrural areas. Consequently, the cost of providing these services willalso go down for the businesses.

• Adequate information: Certain services will encounter a fillip be-cause of availability of greater information. For example, exporterscan, through the CSCs, get information about crop sown by farmersin a particular area and might enter into a forward contract withthem. CSCs would thus create market by acting as an interface.

As the demand increases, the PPP model providing such serviceswould become viable and more and more private players will enterthe market reducing the cost of provision of such services. Followingexamples illustrate how above characteristics brought to bear by theprivate sector through the CSC as vehicle can lead to market creation.

4.1. Market creation in education

Traditionally, a girl child has always been treated differently inmost states in India. Where a boy is seen as a money earner andhence, it makes more sense to invest in his studies, a girl is assumedto take care of household chores and studies don't matter much inher life. However, the scenario has changed in recent past with par-ents realizing the importance of education. With different educationaland promotional schemes launched by both state and central govern-ments, enrolment of girls in schools has increased (GOI, 2011).

However, few factors remain which act as a hindrance to bettereducation of the girl child. Distance and cost are two of the most im-portant factors that affect this decision. As long as education is easilyaccessible at reasonable rates, parents are willing to send girls for ed-ucation. Another very important aspect is the social constraint. Forcultural as well as security reasons, a girl is not usually allowed tostay out of house during after hours in most of rural India. Thus, thegirl child is often denied in tuitions or English speaking courses be-cause of the distance required to travel and the late timings of theseservices, which are inconvenient for her. Table 1 which presents

Table 1Gender-wise break of students in secondary school and students taking tuition.

Panchayatarea

Students in secondaryschool

Students taking tuition

Total Boys Girls Total Boys Girls

Bidire 70 35 35 7 5 2Hosakere 200 105 95 12 8 4Alilughutta 137 73 67 21 18 3

data from schools in 3 panchayat areas in Tumkur district in theState of Karnataka illustrates this.

The ratio of boys to girls taking tuition is highly skewed towardboys while the composition of students going to government-run sec-ondary schools shows no such pattern. During the interviews con-ducted with female students in these areas, the main reasons thatwere cited by them included the accessibility of coaching institutesand social constraints. In our interaction with the female studentsthey felt that tele-education could serve as an effective substitutefor private coaching classes and could aid them in getting coachingat the school itself. If educational services like tuitions for boardexams, English speaking courses etc. are provided at the communitylevel by CSCs via e-learning courses then they can attract enough stu-dents to make the service financially viable and in the process providemuch needed help to a girl child. Educational services, in general,would be helpful to all children pursuing secondary or higher educa-tion since quantity, availability and quality of teachers at these levelsin public schools is often not even up to the minimum standards.

4.2. Market creation in insurance

Insurance has low penetration in rural India. One of the impedi-ments in providing insurance to people in rural areas is the accentuat-ed moral hazard and adverse selection problem caused by lack ofreliable information about people and their practices in these areas.The cost of obtaining information about agricultural practices in caseof crop insurance or living practices, medical history etc. in case oflife insurance, is very high. Now, consider the casewhen CSCs functionas agents of the insurance company, the cost of obtaining this informa-tion is reduced considerably because the CSCs are much closer to thepeople being insured. At the same time, since these services are pro-vided by CSCs which have a permanent presence in the village, peopleperceive them to be more reliable and can follow up easily on prob-lems related to insurance claims. The problems of moral hazard are re-duced because insurance companies can nowmonitor the practices offarmers etc. more closely and regularly by having a local person as theagent. The problem of adverse selection is mitigated because villagecommunities being close-knit, information about risk in providing in-surance to a person is known more accurately.

4.3. Market creation in health

People in rural areas, especially doing manual labor, do not getproper treatment for a lot of diseases such as skin diseases, eye-related infections and disorders etc. because of the absence of special-ists in these areas and inconvenience in traveling to the nearest healthcenter which is costly and time-consuming as well. Setting up of atelemedicine center at the CSC would solve these problems of accessby providing affordable care by saving time and making it convenient.Thus a market can successfully be created for certain health services.

4.4. Market creation in agriculture

A farmer engaged in agricultural activity requires many services atvarious stages of crop production. At the beginning of the season, thefarmer needs crop advisory services related to seeds, fertilizers, typeof crop, soil testing etc. Because of the dependence of agriculture inIndia on rainfall and the inherent uncertainty involved, farmersneed crop insurance as well. Farmers also have many training needsregarding farming technologies. All these services can be integratedand provided by the CSCs. The CSCs can also become the interfacefor farmers and business buying the produce. An exporter for exam-ple, would be able to gather from CSCs information about the cropsown by farmers in a particular area, the condition of the crop andthe total production in that region. Seed companies would be ableto know which seed would be in demand in the next season. CSCs

Table 2Monthly average expenses and revenue for pilot CSCs in Karnataka.

Average monthly expenses per CSC (INR) Monthly revenue per CSC(INR)

Equipment (laptop, printer,webcam, biometric and UPS)a

3050 RTC(G2C)b 860

Power 200 RDS(G2C)b 790Connectivity (standard schemesof BSNLc)

1100 Panchayat admin(G2G)d 5000

Spacee 500 NREGA(G2G)d 5000Salaryf 6000 Oxigen(B2C)g 500Supervisory and related expenses 3750 Tele-education(G2C)h 3200Training of personnel (amortized) 120Stationary 600Total 15,320 15,350

a EMI calculated for 18 months lifespan and 12% interest rate on total investment ofRs 50,000.

b Calculated based on actual data for the month of May and June 2011. CSCs share is50% of the revenue from these services which are charged at Rs 10/land record copyand at 15/RDS service which is mainly a certificate.

c BSNL is a public sector telecom company having extensive network in rural areas.d Government has agreed to pay this for collection and digitization of data.e Rental value is imputed, as the local body is providing space free of cost.f Representative salary of one well qualified operator or two semi qualified opera-

tors, both arrangements prevailing in the existing CSCs.g Oxigen services are mobile phone recharge of various companies and payment for

television channels.h District administration has agreed to pay Rs 80 per student out of which Rs 32 will

be the share of CSC.

S85G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

can also facilitate contract farming. For example, certain special cropsare not grown by farmers because their demand is very limited anduncertain. Retail houses can procure those items only by way of con-tract farming but because of the lack of trust among farmers and theuncertainty in prices of these crops, farmers are unwilling to growsuch crops. CSCs can help bridge the trust deficit. Retail houses can in-terface with the CSCs to contract farmers for these special crops.

As these examples illustrate, CSCs by bridging the gap betweenbusinesses and rural population, can become the front-end andchange the nature of service delivery. This will cause a rightwardshift in the demand curve. Fig. 1 demonstrates the comparative staticsof the market in presence of telecenters. As the business model be-comes viable and cost to provide these services decreases, more andmore private players will enter the market and the supply curvealso shifts rightward. The shift in the supply and demand curve willlead to shift in the equilibrium point from A, virtually no marketwith quantity q1, to a point B, where both businesses and consumersare better off with quantity q2.

However, such market creation needs proper assurance to thepeople about the service quality, convenient location and facility ofgetting grievances addressed locally. For example reliability of tele-medicine services will be more if the service point is located in a Pri-mary Health Center or in gram panchayat (village level, localgovernment body) premises. This can happen only when the govern-ment services are also embedded in the CSC services. As part of suchan arrangement CSCs can be located at gram panchayat and govern-ment services related to agriculture, education, health, social security,etc. are delivered through them.

5. Empirical findings

In this section, we present empirical findings from two e-governance projects — A pilot project in Tumkur district in State ofKarnataka and Akshaya Project in State of Kerala. The pilot project inKarnataka involved functioning of 15 CSCs which offered a cluster ofservices catering to a population of roughly 10,000 each. For theAkshaya Project, data was collected for 2 Akshaya centers in Trivan-drum district, each center catering to a population of roughly15,000 each.

5.1. Financial sustainability

Table 2 provides the data on average costs and revenues for 15pilot CSCs being run as part of the aforementioned pilot project inKarnataka State in India. The CSCs cluster various G2C and G2G

Quantity

Pri

ce

A (p1, q1)

(No viable market)B (p2, q2)

(Viable market)

D1

D2

S1

S2

S3

S4

Fig. 1. Market statics with increased access to information (Naik et al., 2010).

services like issuance of certificates, panchayat administration work,education programs etc. in addition to various B2C services.

As the data in the above table shows, a bulk of the revenue for thetelecenter comes from government (G2C and G2G) services. Govern-ment services from various departments of State government andlocal government bodies have to be clustered for the telecenter tobe able to break-even. The data from Akshaya Project in Kerala Stateprovides further evidence in this regard. Table 3 shows the averagemonthly expenses and revenues for Akshaya centers operating inrural areas.

We observe that in both the projects the share of fixed cost in the totalcost is high, indicating the need to enlarge the bouquet of services offered.The mix of services provided by both the centers differ widely butthe figures provided above illustrate how clustering multiple servicescan make these centers financially sustainable. If only a subset ofthese services is provided, these centers do not break-even. Also, amajor component of the revenue is contributed by government services.

Table 3Monthly average expense and revenue for Akshaya centers in Trivandrum District,Kerala.

Average monthly expenses per CSC (INR) Monthly revenue per CSC (INR)

Equipment (laptop, printer,webcam, biometric and UPS)a

6100 E-pay (G2C)b 1700

Electricity 1000 E-ticketing (G2C)b 7000Connectivity 1000 Ration card issuance (G2C)b 2500Spacec 1000 IGNOU (G2C)b 1000Salaryd 8000 Intel learning program (G2C)b 3500Maintenance 500 DTP (B2C services like

printing, Xerox etc.)e3000

Total 17,600 Total 18,700

a EMI calculated for 18 months lifespan and 12% interest rate on total cost ofRs 100,000.

b Figures as reported to the District Office, Akshaya Project.c Rental value is imputed since the space is owned by the entrepreneur running the

telecenter.d Represents salaries paid to two operators.e Figures obtained from entrepreneurs during interviews conducted in month of

July, 2011.

Fig. 2. Break-up of revenues coming from educational and others G2C services.

S86 G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

5.2. Market creation for educational and training services: Akshaya cen-ters in Kerala

TheAkshaya Project in State of Kerala in India is illustrative of howed-ucational services can form amajor source of revenue for the telecentersvia market creation by tapping into latent demand. Currently, Akshayacenters are delivering the following educational services, each of whichcaters to a latent demand for which markets have been hitherto absent:

a) Intel-Learning Program (ILP): ILP is a short-duration (15 days)group-based study program conducted for students between 6and 16 years during summer vacations. In absence of other educa-tional opportunities during the summer break from school, thisprogram provides an avenue for learning for students.

b) E-vidya: E-vidya is an advanced level e-literacy program providingcomputer training to adults.

c) Kudumbashree: Kudambashree is a training program for womenself-help groups.

d) Malyalam Computing (MC): Malyalam Computing is a programfor training people in word processing in the local language tobridge the language divide.

e) IGNOU courses: Undergraduate, Diploma and Post-Graduatecourses from Indira Gandhi National Open University (IGNOU)are offered through Akshaya centers. Some of the Akshaya centersalso function as study centers from these courses.

f) Medical Transcription: A job-oriented training program whichtrains graduates in medical transcription.

Apart from meeting unfulfilled educational needs, these servicesalso form substantial source of revenues for the telecenters. Table 4shows the revenue generated, at the State level, from these educa-tional services for the period from May 2010 to June 2011.

The data indicates that, these educational services contribute to-ward one-fourth of annual revenues of the telecenters (Fig. 2).

6. Implications of e-governance embedded rural telecenters onlocal governance

Information can play a crucial role in improving the interaction be-tween government and rural citizens. The advantages from availabilityof information accrue not only to citizens but can also help in substan-tially improving the following aspects of public service delivery.

1) Planning: With more accurate data at each delivery point, infra-structure can be planned better. For example, with accurate dataabout usage of health services, the stock of drugs required at a Pri-mary Health Center (PHC) can be inferred.

2) Execution: With more frequent data at the delivery points, servicedelivery can be executed better by reducing the time between re-alizing the need of action and taking the action itself. For example,with weekly data of stocks of drug at a PHC, the stock can bereplenished whenever it goes below a desired level.

3) Monitoring: Availability of accurate and frequent data can help infine tuning or course correction required for government programs.Detailed data about health and nutritional indicators of a village canhelp in evaluating the effectiveness of government interventions.

Table 4Revenue from Educational Services in Akshaya Project

Revenue from e-learning for the year May-2010 to June 2011

Particulars Income (in INR)ILP 9,500,000E-vidya 3,419,870Kudumbashree 3,200,000Malyalam Computing 2,000,000IGNOU Courses 1,718,676Medical Transcription 800,000

4) Evaluation: With more accurate and detailed data, the evaluationof a program can be more appropriately conducted. For example,with more accurate information on the size of land holdingsunder NREGS,6 the total asset creation through the employmentprogram can be more accurately assessed and the return onmoney spent in the program would be more accurately known.

Fig. 3 illustrates the effect of access to quality information for gov-ernment on various aspects of service delivery.

6.1. Local governance

Government agencies at local levels need to collect, collate and passon information which is then used by various agencies of the govern-ment for purposes of planning, execution, monitoring and evaluationof government programs. In India, the task of data collection, entryand maintenance is performed by local government employees and is-sues like same data collected bymultiple officers or same data collectedmultiple times by the same officer leading to data redundancy are rou-tinely observed. Most of this information is maintained in hand-writtenform and not stored electronically and hence sharing data across multi-ple departments becomes very difficult and time consuming. Resultant-ly, these data related tasks consume most of the time of the personnelin-charge leaving little time for them to take care of other important re-sponsibility entrusted to them.

The traditional flow of information from government to citizens(and vice-versa) follows a hierarchical approach flowing from stategovernment departments/agencies to the gram panchayats, whichin-turn interface with the citizens for provision of services and vice-versa. Fig. 4 shows the traditional flow of information and servicesfrom government to citizens.

This traditional process of service provision which uses hierarchicalflow of information is time consuming and entails high administrativecost for the government. Information passes through too many levelsof government before reaching the rural citizen. Also, over time thelinkages at lower government levels have weakened because of lack ofadequatemanpower both quantitatively and qualitatively. For example,in Karnataka, 43% of the field level jobs in agriculture department arevacant. Hence, while the linkages from the state to the district and dis-trict to the taluk7 level government are still strong, further linkages fromtaluk to village panchayat and village panchayat to the citizen are veryweak leading to last mile problems in service delivery.

6 NREGS is a Government program of India which guarantees employment to onemember of every household for a minimum of 100 days in a year.

7 A taluk is an administrative unit smaller than a district but larger than a village.

DepartmentsSTATE

1 2 3 4 5

1 Revenue2 Rural Development3 Health4 Education

DISTRICT5 Agriculture

TALUKA

GRAM PANCHAYAT

RURAL CITIZEN

Fig. 4. Traditional flow of information to a rural citizen.

Better Planning ofGovernment

Services/SchemesAccess

- Cost - Connectivity- Capacity- Adequacy - Reliability

Information

Easy Monitoringand Evaluation

Effective Delivery

Fig. 3. Role of information in the government.

DepartmentsSTATE

1 2 3 4 5

1 Revenue2 Rural Development3 Health4 Education

DISTRICT

5 Agriculture

TALUKA

1 2 3 4 5

BUSINESS

GRAM PANCHAYAT CSC

S87G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

6.2. Potential role of telecenters in improving governance at local levels

CSCs can be extended to provide G2G services by making them thefront end of collection of information. In the proposed PPP, the datacollected by the CSCs at the village level can be uploaded, directly aswell as through different levels of government, to a central database.Following are some of the examples of G2G services that can be inte-grated with telecenters.

• National Rural Employment Guarantee Scheme (NREGS): In manyvillage panchayats, the village panchayat secretary spends 6 h aday in maintaining records. S(he) maintains 60 record books on adaily basis having enormous redundancies. This data can be collect-ed by the CSCs and uploaded regularly.

• Anganwadi Worker (AWW): The household health and nutritiondata collected at the Anganwadi (Child Care Centers) by Anganwadiworkers can be collected by the CSCs.

• Crop-updation: This activity is being carried out by village accoun-tants at present. The crop area is mostly inaccurate and often arbi-trarily recorded. Using GPS enabled hand-held devices, this datacan be accurately recorded.

• Public Distribution System (PDS): Real time data regarding the al-lotment and disbursement of food items through PDS can be availedthrough these kiosks the CSCs.

• Sarva Shiksha Abhiyan (SSA)8: As part of the program, local govern-ment personnel need to collect data on attendance, mid-day meal

8 Sarva Shiksha Abhiyan (SSA) is a government program providing free education tochildren.

provisions, students' performance and teacher availability. CSCscan provide efficient ways of collecting this data.

The transfer of responsibility of these services from government toCSCs would change the way information flows through governmenthierarchy as illustrated in next section.

6.3. Change in flow of information because of telecenters

In the presence of CSCs a large portion of the data can be collectedby them, digitized and uploaded to a central database. This wouldchange the nature of business processes involved in both service de-livery and program implementation mitigating future risk for func-tioning of telecenters (Aichholzer, 2004). The flow of information inthe presence of rural kiosks or CSCs is shown in Fig. 5.

The advantages in collection of information through telecentersare as follows.

• Reduction in data redundancy: Consider the example of Sarva Shik-sha Abhiyan (SSA), where personnel spend a lot of time manuallywriting information regarding daily attendance, mid-day meal, stu-dent performance etc. Each time the personnel need to copy thename of all the students. If data is collected using electronic sys-tems, such redundancies can be reduced.

• Faster: In the above example, the attendance can be taken usingbiometric systems and uploaded to the information system, whichwould make the process faster.

RURAL CITIZEN

Fig. 5. Flow of information after the provision of common service centers.

Rural Information System

State

District

TALUKA

GRAM PANCHAYAT

Dept1 Dept2 Deptn

Field Office

CSC

Back Office Front Office

EXISTING ARCHITECTURE

Citizen/Village

DataCapture\Digitizationand Service Delivery

Secured Data CustodiansData controlled by biometrics

Ministries/Dept. Heads

CEO/District Collector

EO/Tahsildar

Gram PanchayatSecretary/Village

Accountant

State

District

Taluka

State DataCentre

District DataCentre

Taluka DataCentre

Gram PanchayatData Centre

Fig. 6. System architecture and information flow.

S88 G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

• Facilitate data aggregation: Continuing with the above example, ifsuch information is uploaded daily in the information system forevery school, district-wise, state-wise and country-wide attendancefigures for each week or month can be produced easily.

• Increase frequency of data collection: If the process of data collec-tion is electronic and thereby faster, data collection can be donemore frequently giving a time series on say health numbers or at-tendance in primary school etc.

• Cost efficient: The cost, if the government implements these sys-tems in each department on their own is very high and often notfunctional. By involving private sector, overall cost for these pro-cesses can be reduced.

• Accurate and reliable: Data on crop area as well as programs likeNREGS used to record asset creation are inaccurate and unreliable.Better quality data can be obtained using GPS devices with timeand date stamping and a camera facility.

• Enhanced data sharing and inter-government co-ordination: Oncethis data is available in electronic format, data sharing among vari-ous government departments, and agencies for policy implementa-tion can be made possible, thereby enhancing co-ordination.

• Strong networks at grassroots level: In addition government de-partments will be able to build a strong network at the grassrootslevel to obtain accurate, detailed and timely data from citizen onthe programs being implemented as well as develop a robust citizendatabase.

• Reduction of burden on government employees: Once relieved ofthese laborious manual data collection procedures, government per-sonnel can focus on their principal administrative responsibilities.

Table 5Illustration of crop advisory provided based on the forecast of weather conditions.

Observed weather condition atNallur Hatti Village

Forecasting of disease or pestor physiological changes

1) Mild cloudy weather.2) Low temperature prevailingthroughout the week.

1) Flowering and fruit set decreases when light induration of sunshine hours are less.2) Possibility of powdery mildew incidence.

Fig. 6 illustrates how the information can be collected, collatedand transmitted to various levels for each government department.

The data collected from the telecenters at the gram panchayat levelwould be added directly to a central database. All other data capturedat the taluka, district or the state level would be integrated into thecentral database. This architecture will need to be fine tuned foreach department depending on the nature of the program and datarequirement suiting the business processes involved.

Based on this analysis, a consortium of citizens, government, aca-demic institutions and IT companies is initiating pilot projects in 15gram panchayats in Gubbi taluk of Tumkur district in Karnataka statein India to demonstrate the creation of viable markets for many ofthe services illustrated in the paper.

6.4. Illustration of various government schemes

In this section we provide specific examples of how CSCs can con-tribute toward improved implementation of various developmentprograms.

6.4.1. National Rural Employment Guarantee SchemeNational Rural Employment Guarantee Scheme is a public works

program of Government of India that guarantees 100 days of manualwork at minimum wages to all household seeking such employment.The special character of the program is that it is funded by the federalgovernment and is implemented by State governments. State govern-ments in turn depend on district administration for planning andmonitoring of the scheme. Gram panchayats (village level elected

Symptoms ofobservation

Control measures

tensity and White powderypatches on the leafpetioles and panicles.

Spraying of Wettable sulfur-3 g/lit orhexacanazole 1.0 ml/lit can prevent theoccurrence of powdery mildew diseasein Mango.

S89G. Naik et al. / Government Information Quarterly 29 (2012) S82–S89

local bodies) are the final government arm that interfaces with therural citizens in implementing this program. Gram panchayats arein-charge of issuing job cards, collecting applications from job cardholder for work, selecting projects, allocating work to individuals, dis-bursing wages, etc. The program involves large fiscal expendituresand a crucial question often raised is on the issues of proper account-ing of works completed and asset created as part of the program. Typ-ical work undertaken under the program includes building of roads,metal spreading, digging for irrigation works etc. The informationon work measurement is collected by gram panchayat officials andis considered very inaccurate in nature. There is considerable leakagein the system due to inability to properly audit the completed work. Alow-cost technology solution to the problem is use of hand-held GPSsystem which can map out co-ordinates of a field and upload the dataon a weekly basis providing highly accurate data on the size of theasset created. As of now, such capacity is unavailable at the gram pan-chayat level and creating this would be expensive and ineffective. TheCSCs can effectively take up this task of work measurement and assetcreation which will facilitate the planning, monitoring and executionof the program at the district and the State level. This will also facili-tate sharing of accurate information about the work undertakenunder the scheme and the social audit of the program at the sametime providing the CSCs with steady source of revenue stream.

6.4.2. Mango crop protectionAdoption of new technology of farming or a shift from one crop-

ping pattern to another always requires support services which pro-vide farmers with expert advices on all aspects of farming. In theabsence of this, the risk of crop failures is very high. Over the yearsthere has been a consistent decline in the capacity of agricultural ex-tension services to provide adequate, useful and reliable advice onvarious aspects of farming like which seeds to use, fertilizer applica-tion, crop protection etc. This has opened up a gap for expert advicewhich is usually filled in by fertilizer or pesticide vendors who oftentake advantage of this asymmetric information situation to boosttheir own sales leading to crop failures and indebtedness amongfarmers. Some of these gaps can be addressed through CSCs withthe use of ICT. An example is mango crop protection advisory serviceprovided by CSC at Nallur Hatti Village, Tumkur District. The datagathered from the installed weather station provides inputs on localweather conditions based on which forecast for potential adverse ef-fect on the Mango crop is made. Farmers are provided with observ-able symptoms to look for, to check for the onset of such adverseconditions and remedial measures to take. Table 5 provides an exam-ple of one such advisory.

7. Conclusion

In the developing world, the telecenters have become the pre-ferred mode of providing e-governance to rural citizens because oflow e-literacy, individual ownership of computer and Internet pene-tration. At the same time entrepreneurs have been testing variousbusiness models to provide services in rural areas. These telecenterscan also improve governance at the lowest levels of administrationby substantially improving the process of collection and managementof data related to various government programs. The presence of tel-ecenters can become a conduit in facilitating the provision of a wider

range of services and can also improve planning, execution, monitor-ing and evaluation of programs at the local levels in these areas. How-ever, execution of e-governance plan often focuses only of B2Cservices ignoring G2C services making them unviable at villagelevel. We have illustrated how e-governance embedded rural telecen-ters can help achieve multiple objectives of effective government ser-vice delivery, sustainable rural telecenters and inclusive growth.

Disclosure Statement

In the publication of this paper, there is no conflict of interest, actualor potential.

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GgaD

opal Naik is a faculty at Centre for Public Policy, Indian Institute of Management, Ban-lore, India. He is also the Chairperson, of the Centre for Excellence for Urbanevelopment.

Siddharth Joshi is a Doctoral Student at the Centre for Public Policy, Indian Institute ofManagement, Bangalore, India.

K.P. Basavaraj is a Research Fellow at the Centre for Public Policy, Indian Institute ofManagement, Bangalore, India.