Story highlights
The ‘State of India’s Digital Economy 2024’ report by the Indian Council for Research on International Economic Relations shows that the state of digitalisation is better than economically-advanced countries.
India is the third-largest digitalised country in the world, just behind the United States and China, says a new report by a Delhi-based think tank.
The ‘State of India’s Digital Economy 2024’ report by the Indian Council for Research on International Economic Relations shows that the state of digitalisation is better than economically-advanced countries.
While the United Kingdom is ranked fourth, Germany – Europe’s largest-economy – is at the fifth position. South Korea is placed sixth while Japan is ranked ninth. Australia (seventh), Indonesia (eighth) and France (tenth) make up the rest of the list.
India’s digital infrastructure does well at the aggregate level, given the massive size of the population.
At over 700 million, India has the second-highest number of internet users in the world. This is more than twice the size of the United States’ population.
The country does particularly well when it comes to providing affordable data connection and utilising internet-based services like payment apps on a regular basis.
Where India lags in internet connectivity
However, at an individual user’s level, India ranks 12th among the G-20 countries.
The report puts the digital divide in the following manner: “While India as a nation is vastly digitalised, the average user is not.”
For instance: At an individual user’s level, Fiji, with 88 per cent of its 0.9 million population connected to the internet, is ranked better than India, where only 52 per cent of the 1.4 billion population is connected to the web.
The difference in the aggregate and individual level of digitalisation exposes India’s digital divide, indicating that there is a great scope for improvement.
India’s gender gap in internet connectivity at 10 per cent, is higher than the world average of 9 per cent.
The rural-urban divide is even higher at 58 per cent, compared to the world average at 49 per cent, adds the report.
How are the countries and states measured?
The report is based on the CHIPS framework:
Connect takes into account affordability, quality and accessibility of internet facilities.
Harness tracks how internet services are being used in the real economy.
Innovate looks at the investment landscape in the tech world.
Protect looks at measures taken for safe and secured internet facilities.
Sustain measures efforts towards making the digital economy more environmentally sustainable.
These five pillars are further divided into 16 sub-pillars and 50 indicators.
Countries and states are rated out of 100, with zero means no digitalisation and 100 means fully digitalised.
India’s third position is largely due to its exceptional performance in the Connect and Harness categories.
Moreover, the gap between India (39.1) and the top two countries – US (65.1) and China (62.3) – is huge.
How India’s states perform
There is wide variation in the overall performance of Indian states.
Karnataka tops the list of digitalised states, followed by Maharashtra, Telangana, Gujarat and Haryana.
On the other end of the spectrum are the states of Bihar, Jharkhand, Odiisha, Madhya Pradesh and Assam.
Among the Union Territories and smaller states, Delhi leads the list while Arunachal Pradesh ranks at the bottom.
The ranking of states and Union Territories tell the story of regional economic disparity in India.
“Richer states and union territories in India have relatively higher levels of digitalisation than poorer states,” says the report while noting that the gap is shrinking.
However, a closer look at the report shows that no state or Union Territory ranks high in every category.
Chhattisgarh, which is ranked 17th in this year’s list, leads in the sub-categories of gender inclusion and public services (through the internet).
The report notes that the regional disparity in the level of digitalisation across India is less than that for G-20 countries.
“Uniform national-level policies, common infrastructure and homogeneity in cultural norms and consumption patterns implies that state performances are likely to be less unequal than in other countries,” states the report.
