MeitY Releases “Estimation and Measurement of India’s Digital Economy” Report

 

India’s digital economy has been experiencing rapid growth, contributing to the national income and employment landscape. The Ministry of Electronics and Information Technology (MeitY) has released a very important report titled “Estimation and Measurement of India’s Digital Economy,” aiming to quantify this sector’s impact. This report is crucial for policymakers and businesses in strategising for future growth.

Definition and Scope of Digital Economy

The digital economy encompasses all economic activities that utilise digital technologies. It includes both new digital industries, such as tech platforms, and the digital share of traditional sectors like banking, education, and trade. This integrated nature makes precise measurement challenging, especially within conventional national accounts.

Recent Estimates and Findings

According to the report, India’s digital economy accounted for approximately 11.74% of the national income in 2022-23, equating to INR 31.64 lakh crore (around USD 402 billion). This figure positions India as a leader among developing countries in measuring its digital economy, utilising the OECD framework and the input-output approach recommended by the Asian Development Bank (ADB).

Key Contributors to Digital Economy

The digital-enabling industry, which includes ICT services and telecommunication, is the largest contributor, making up 7.83% of Gross Value Added (GVA). New digital industries, comprising major tech firms and platforms, contribute nearly 2% to GVA. Additionally, traditional sectors like banking and education contribute another 2%, denoting the pervasive influence of digitalisation across the economy.

Employment Impact

The digital economy employed approximately 14.67 million workers, representing 2.55% of India’s workforce in 2022-23. This employment figure puts stress on the sector’s role in job creation and its potential for future growth.

Future Projections

Projections indicate that India’s digital economy is set to grow nearly twice as fast as the overall economy, potentially contributing to one-fifth of national income by 2030. The growth will primarily stem from digital intermediaries and platforms, along with increased digitalisation across various sectors.

Challenges in Data and Measurement

The estimates provided in the report are considered conservative due to limited data availability. Key areas lacking comprehensive data include smaller digital platforms, informal sector digitalisation, and the digitalisation of traditional sectors like health and logistics.

Importance for Policymakers and Businesses

The insights from the report are vital for effective policymaking and strategic business decisions. Accurate data on the digital economy allows for targeted interventions, promotes innovation, and enhances competitiveness in a global market. Policymakers can leverage this information for informed decisions that support digital growth across the economy.

website: popularscientist.com

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