India's digital public infrastructure (DPI) is experiencing a divergent trajectory across key sectors, with financial services leveraging its potential while healthcare adoption remains largely in pilot mode, according to a recent study. The "State of Digital Public Infrastructure in India" report, jointly released by IIM Bangalore and Protean eGov Technologies Ltd., provides an evidence-based assessment of DPI evolution, highlighting both progress and persistent challenges.
DPI, defined as a set of open, interoperable, and scalable digital systems, is designed to enable efficient access to services for citizens, businesses, and governments. In India, these systems include Aadhaar, UPI, DigiLocker, and various platforms for health and public services. The report emphasizes that DPI has evolved beyond a mere collection of digital utilities, becoming a unifying architecture that fosters unprecedented ease and trust in interactions between citizens, institutions, and markets.
The financial services sector has successfully moved into a "leverage phase," capitalizing on a robust Payments, Identity, and Consent framework. Aadhaar-enabled eKYC, UPI, and consent-based data sharing through the Account Aggregator framework have collectively facilitated new credit flows, real-time payments, and innovation for consumers and MSMEs. UPI, in particular, has emerged as a dominant force, driving 49% of global real-time payments and processing approximately ₹200 lakh crore in FY24. The success of Direct Benefit Transfers (DBT) supported by Aadhaar, covering 328 schemes across 56 ministries, further underscores the transformative impact of DPI in the financial realm. By 2022, the government saved over US$ 27 billion through the efficiency and transparency gains from DBT. As of October 2024, UPI processed 16.58 billion financial transactions, highlighting its crucial role in India's digital transformation.
In contrast, the healthcare sector faces significant barriers in achieving widespread DPI adoption. Despite initiatives like the Ayushman Bharat Digital Mission (ABDM), which aims to establish a unified digital health ecosystem, the healthcare sector is still in a nascent stage of DPI implementation, grappling with structural and operational challenges. ABDM intends to support healthcare facilities in adopting the digital health ecosystem, making the benefits of digital health accessible to all citizens. The mission also focuses on creating interoperable Electronic Health Records (EHRs) to facilitate continuity of care and improve health outcomes. Key components of the digital health mission include the creation of Ayushman Bharat Health Account (ABHA) and the establishment of a unique identity (ABHA ID) across healthcare providers.
Several factors contribute to the slower adoption of DPI in healthcare. These may include a lack of digital literacy, especially in rural areas, and concerns regarding data security and privacy. Moreover, the fragmented nature of the healthcare ecosystem, with a mix of public and private providers, poses challenges in achieving seamless data sharing and interoperability. However, digital health technologies are transforming healthcare delivery across India, addressing critical challenges and expanding access to care. Telemedicine platforms, such as eSanjeevani, are overcoming geographical barriers and reaching remote populations with high-quality healthcare.
To accelerate DPI adoption in healthcare, the National Health Authority (NHA) has launched the Digital Health Incentive Scheme (DHIS) to incentivize stakeholders in the digital health ecosystem. This scheme aims to encourage healthcare providers to adopt digital health solutions and promote the digitization of patient health records. The Ministry of Health & Family Welfare has also taken key initiatives to establish a National Digital Health Eco-system to ensure citizen-centric health service, quality of care, and universal health coverage.
Looking ahead, India's DPI model is poised to serve as a benchmark for developing economies. By leveraging open systems and fostering private innovation with regulatory support, India's DPI framework can enable countries to scale services while maintaining inclusivity and trust. As India continues its digital transformation journey, addressing the challenges in healthcare and promoting equitable access to digital infrastructure will be crucial in realizing the full potential of DPI.
