Center for Digital Economy


The term 'Digital Economy' was coined in Don Tapscott's 1995 book The Digital Economy: Promise and Peril in the Age of Networked Intelligence[1]. Digital Economy is characterized by increased reliance on digital technology. In one sense it is a worldwide network of economic activities, commercial transactions and professional interactions that are enabled by information and communication technologies. It is different from Internet economy which mainly focuses on the economic value derived from the Internet. The three main components of the 'Digital Economy' concept are[2]:

  • e-business infrastructure (hardware, software, telecoms, networks, human capital, etc.),
  • e-business (how business is conducted, any process that an organization conducts over computer-mediated networks),
  • e-commerce (transfer of goods, for example when a book is sold online).

However, with the advent of web II and web III technologies, such as social media and IoT, these boundaries have become further blurred. In the new economy, digital networking and communication infrastructure provides a global platform over which people and organizations devise strategies, interact, communicate, collaborate and search for information.

The Indian digital environment is characterized by the following:

  • Increased penetration of Mobile phones, smart phones and Internet in the society
  • Increased presence of ICTs in the life of common people
  • Increased electronic and mobile commerce activities
  • Increased reliance and promotion of the Government over use of ICTs through its Digital India program

Considering the changing scenario, we consider Digital Economy as having the three main components:

Government of India’s Digital India program has given boost to the use of digital infrastructure for financial inclusion as well as micropayments. The plan for providing country wide access to digital infrastructure including hi-speed wifi and so on has given boost to digital economy in India. However, this brings a number of questions that need to be carefully examined. For example, what is the impact of Digital India programs at the grassroot level. One of the notable reforms in Digital India program is the launch of GeM (Govt. e-marketplace), a portal for Government procurement that is supposed to facilitate MSMEs in their endeavor to participate in procurement activities. The notable question remains is has there been any ground-breaking impact on the beneficiaries through the use of ICTs or digital platform. The center for digital economy would examine such issues in the project and consultancy mode.

The second leg of the Digital Economy is the increase electronic and mobile commerce in India. The tech savvy young generation is more drawn towards online purchases for even simplest of items. The increased online generation has in-turn further enhanced electronic commerce and mobile commerce in the country. A large number of payment banks have mushroomed in the country including Government’s own BHIM (Bharat Interface for Money). How are these impacting our economy? The center for digital economy would look into such issues through whitepapers, publications and projects in this area.

The third and the main leg characterizing Digital Economy is the increased production of data at every level. Our economy is going through the transition phase for understanding and analyze such data. Government of India has itself launched its own open data portal where the data is available for analysis. Considering the increasing production and strategic importance of data, the center for digital economy would look into providing consultancy, training and research in the field of data analytics.

[1] Tapscott, Don (1997). The digital economy : promise and peril in the age of networked intelligence. New York: McGraw-Hill.

[2] Mesenbourg, T.L. (2001). Measuring the Digital Economy. U.S. Bureau of the Census.