Indian Government Releases National Blockchain Strategy


Indian Government has published National Blockchain Strategy dubbed “Blockchain — The India Strategy”. It explains the different use cases of blockchains in India together with some conclusions of the pilot projects in progress. NITI Aayog, National Institution for Transforming India, explains that the generic characteristics of distributed ledger technology could represent a paradigm shift in India’s political economy.

03 February, 2020 | AtoZ Markets – The Indian government has taken several initiatives to improve both the ease of doing business and living. The government is also streamlining and simplifying processes, primarily by leveraging technology and proactively rationalizing various regulatory and other requirements. However, further improvements are still needed. According to NITI Aayog, Blockchain presents the potential for achieving the vision of the Indian government.

Indian National Blockchain Strategy

NITI Aayog has published its national draft document of blockchain policy. The policy document is in two different parts. The first part, entitled “Blockchain: The strategy for India.” It explains the different use cases of the blockchain in India, together with some conclusions of the ongoing pilot projects. The second part will be published in the coming weeks and will mainly concern several recommendations for the use of blockchain technology in India.

The first part of the strategy document is toward:

  • Enabling Ease of Business, 
  • Ease of living and 
  • Ease of Governance

The policy document aims to respond to these needs. The document analyzes the value of blockchain in facilitating trust in interactions between the government and the private sector. Moreover, NITI Aayog’s experiences in implementing of the blockchain show the potential use cases that the ecosystem can take into consideration. Governance in India is facing unique challenges, given the scale, diversity, and complexity of the processes involved in providing various public services.

The document targets stakeholders, such as the government, business leaders and citizens, to demystify the concepts surrounding blockchain technology. It aims to create a concrete national action plan for blockchain technology.

NITI Aayog explains that the generic characteristics of distributed ledger technology (DLT) could represent a paradigm shift in India’s political economy. It is also essential to understand that the mechanism of decentralization or peer-to-peer exchange is a spectrum and not a binary concept. It must also be understood separately from government regulation. Networks completely regulated by governments can also decentralize and equip with peer-to-peer exchange and, fully centralized systems. It can also be unregulated and operate beyond the limits of the law.

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Pilots and POC Project Overview

NITI Aayog pursued pilots and proof-of-concept (POC) project in four areas. It will assess the potential of blockchain technology in providing better efficiency and understanding of possible obstacles in implementation. These are:

  • Track and trace of drugs in the pharmaceutical supply chain
  • Request verification and approval in the delivery of the fertilizer subsidy
  • Verification of university certificates
  • Transfer of land registers

According to NITI Aayog, the problem/pain point was to reduce response times for reimbursement of subsidy payments and transport requests. The existing workflow filled with inefficiencies, including multiple registration systems, limited visibility for inventory and low trust in the data generated for subsidy and freight requests. However, there was a valid problem, deeply embedded in the business rationale.

However, according to NITI Aayog, the private and public sectors need some legal and regulatory changes to build a large-scale blockchain.

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