B20 Summit India: Rajesh Gopinathan On Inclusion Of Technology In Global Ecosystem

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Former TCS MD and CEO Rajesh Gopinathan speaks about inclusion of technology in the global ecosystem and the need for digital literacy.

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00:00 We are at the B20 India Summit and I am talking to Rajesh Gopinathan, who is the co-chair of

00:06 India Task Force on Digital Transformation. Rajesh, thank you very much for joining us on NDTV and BQ

00:13 Prime. To start with, you made some certain recommendations, can you take us through those

00:18 recommendations for digital transformation? Given the vastness of digital transformation,

00:22 we are focused on making sure there is continuity between what has been done in the past B20s and

00:26 what we are recommending and focusing on how to ensure that the implementation is brought front

00:32 and center. So there are four foundational areas that we are talking about. First is connectivity.

00:38 I'm saying connectivity should be seen the way we look at electricity. Today, governments globally

00:43 think about providing good, reliable electric power as a fundamental requirement, both from

00:49 an economy perspective as well as from a regular societal perspective. We need to think about

00:55 connectivity in the same way, universal connectivity, high quality, reliable and future proof. And

01:01 everything that we do on the regulatory environment needs to enable the deployment of this level of

01:07 connectivity globally and that's going to be a critical requirement for economy-wide

01:11 transformation. That's number one. Number two is digital literacy. Similarly, education has

01:20 always been a localized subject, but the sheer skill requirement and the portability of capabilities,

01:27 if you can get the educational standards to a common minimum, is very high. So we are suggesting

01:32 the creation of a global minimum standard for digital literacy and some form of an institutional

01:38 intervention to have accreditation at an institute and at a teacher level so that skills that have

01:44 been imparted can be relied on by industry and by businesses globally so that we can

01:51 confidently seek out talent anywhere in the ecosystem. Third is related to MSMEs. Traditionally,

02:00 MSMEs have always lagged technology progress and it has been a trickle-down effect for technology

02:06 adoption. There is an opportunity and a need to change that mindset and say that MSME technology

02:13 adoption on the digital side should be kept apace with industry rather than seeing it as a trickle

02:18 down effect. For that, making financing available to them when they want to invest in digital

02:23 transformation and also taking from the success of the India digital stack, making sure that

02:29 basic digital toolkits on a sector-specific level are made available for MSMEs to actually power

02:36 their digital transformation. And last but not least, cybersecurity. Security will again be a

02:42 sovereign subject but if each of the 20 countries were to agree on a common minimum cybersecurity

02:49 standard, the actual effectiveness of compliance will go up. Right now, the cost of compliance

02:54 is very high. Effectiveness is probably slightly lagging. We could actually increase the efficiency

03:00 of compliance so that we can actually take up the overall effectiveness of the cybersecurity side

03:05 by harmonizing global cybersecurity standards. So, these are the four main recommendations.

03:10 What kind of learnings that we have from the India digital stack which has been created

03:15 and how much of that can be actually, you know, said tomorrow can be adopted very easily by the

03:22 G20 countries as a base? I think what we are suggesting in MSME is essentially a take-off

03:27 from the India digital stack. We are saying sector-specific digital toolkit. Now, the India

03:32 digital stack is actually an economy-wide digital toolkit because elements of it can be individually

03:38 used by businesses and businesses can innovate on top while government provides that infrastructure.

03:43 We are suggesting that the same thing should be done in industry after industry and whatever has

03:48 been built by India, India has been offering it globally that can be used. And in other industries,

03:54 similar kind of investments need to be made. Some of those investments per se will be made by

04:00 private players and government regulatory framework should be open to that and should govern that

04:07 rather than prevent that or be afraid of it. So, supply chain infrastructure in a manner in which

04:13 will the large global corporates will be the natural ones that will actually deliver that

04:18 to a larger MSME. Go on that rather than regulate against it and have effective focus on what you

04:27 want to govern rather than prevent it. My question was on financing and investment

04:31 which was there. You spoke about briefly, where will that financing come from? Which are the

04:36 players that can be? I know Uday Khodak spoke about 0.2 percent of your profits can be used

04:42 for this purposes. But how do we make it much more democratized with respect to financing of that and

04:52 not depending just on the companies? So, in fact, I believe that capital

04:56 availability is the least of the problems. Capital is available. Now, the issue that is there is that

05:01 the user population is so heterogeneous that there is friction between the availability of capital

05:08 and the actual access to the capital. If you try to create common standards, the ability for capital

05:15 to find the right business will also increase and then we need to have enabling mechanisms. So,

05:20 like for the MSME, it should be as easy for them to get financing to make a digital investment

05:27 as it is for them to today set up a factory. If you want to set up a factory, you are likely to

05:31 get a loan because there is physical collateral and there is a regulatory environment for it.

05:35 If you want to invest it in building, upgrading your IT systems, you are unlikely to get it as

05:40 easily because the regulatory environment to actually think about whether this is real or not

05:45 is currently lacking. Is not it even more better to look from a point of view of a supply chain

05:53 point of view like a big company bring which has hundreds of vendors and those vendors will have

05:58 hundreds of sub vendors which is there and using tech stack to do it and integrate it. How easy is

06:04 it for them to do it and if I am going to say that okay we are not just talking one country,

06:10 we are talking across geographies. How do we reduce the frictions with respect to taxation,

06:17 with respect to capital flows, all those things will have repercussions. Is there a way to

06:25 reduce those frictions? So, technology adoption in the MSME structure center is being driven in

06:31 many instances through this kind of downward push from the large, the mega corporates at the top.

06:39 What we are suggesting is that that is the natural flow of things. So, we need to regulate it,

06:45 but we should not be afraid of that and we should actually encourage the formation of those

06:52 networks and the standards that they put. But rather than every single person coming up with

06:58 their own standard, it would be even better if those global standards are available, then these

07:02 networks can also start converging into those standards and those standards can be effectively

07:07 governed. And what about use of new technology like AI and all, we are talking a lot of being

07:13 talked about AI, how it can be used at the bottom of the pyramid, MSMEs, I was attending one of the

07:21 Chandra's session, where Shantanu was sharing it and he was talking about how a lot of, in the

07:28 MSME space, a lot of AI can help them bring in more efficiency. How can that adoption happen

07:36 very easily for them, because they are already lagging behind on technology, we are talking of

07:41 adoption of AI. But Sajid, typically, if you make access available,

07:46 adoption by MSME is quite high. So, I mean, it is a very trivial example, but if you look at it

07:51 today, no trader in India does not have a WhatsApp presence, for everyone by default will use that

08:00 channel. So, once something is available on an ease to use basis, there it was a technology

08:05 ease to use. Similarly, if you make it available, MSMEs automatically, it is a very democratic

08:11 environment, they will end up using it. So, access and ease of use is a bigger driver,

08:18 we do not need to encourage them to use it, they will use it as long as you make it available. And

08:24 it is in a manner in which it cuts across boundaries. Who will regulate that? Who will

08:29 regulate it? That is a big question which everyone is asking. But what do you want to regulate?

08:34 That is the whole point that regulate the networks in terms of think what is the governance that you

08:40 want to achieve. So, if you want to regulate at a data level, the data protection laws, that is

08:45 fine, keep it transparent, make it inclusive. So, think about what you want to regulate,

08:49 rather than be afraid of the network, because the network is the reality of the digital future.

08:57 And encourage the networks, but zoom out and regulate it at a meta level, rather than at a

09:02 micro level. And also create the enabling blocks, so that certain blocks like KYC,

09:10 the fundamental blocks make it available in forms that can be consumed. So, you are regulating from

09:17 that side, you are regulating from the top side. Rajesh, it was a pleasure talking to you today.

09:21 Thank you very much for joining us. My pleasure. Thank you, Sajay. Thanks.

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