The ever-emerging landscape of blockchain is expanding at an incredible pace, and governments worldwide are adapting this new-age solution in their digital developments. Among all the countries, India – as a leader in the information technology (IT) sector – has adopted blockchain technology as a major primitive and built significant developments.
With the ever-increasing interest in Bitcoin and other cryptocurrencies, Indian users have created one of the largest country-wise user bases for blockchain products. This has also influenced the launching of several blockchain-based initiatives within the country.
In this article, we will discuss different initiatives taken by the Indian government and state agencies to embrace blockchain through novel developments. These developments are launched in various sectors, including public services, payments, government databases, and other real-world use cases. Let’s get into it and discuss some of the best applications in detail.
Before going further, here is a quick note on what blockchain is and why it’s becoming popular.
What is Blockchain?
Blockchain is a decentralized database that uses the fundamental values of distributed ledger technology (DLT) to store, secure, and share digital data. Unlike traditional databases, data on Blockchain is not stored in a particular server nor can it be managed by any single entity. Here, the data is stored in blocks, which are interconnected and secured via hash cryptography algorithms.
Blockchain Applications Launched By Indian Governments
Many countries worldwide have recognized the potential of blockchain technology in various domains and are actively assessing its value proposition. Following are the major 6 blockchain applications and initiatives launched by Indian state governments and central government agencies in recent times;
1. CBDC – Digital Rupee
When it comes to government and public applications of blockchain, Central Bank Digital Currency (CBDC) always comes to the forefront. The Government of India is also not an exception to this, which announced the launch of CBDC in the Union Budget session held on February 1, 2022.
The official document from the Reserve Bank of India (RBI) said that CBDC (Digital Rupee) will give a big boost to India’s digital economy and enable a ‘cheaper and more efficient currency management system.’ The government officials also stated that the CBDC pilot launched by the RBI is based on blockchain technology.
2. New Town Kolkata Development Authority (NKDA) uses NFTs
The statutory authority under the State Government of West Bengal, the NKDA launched the novel application of land mutation using NFTs. This initiative included certification of a land area of 27,000 acres, which was represented by 5,00,000 NFTs on Polygon Supernets. These NFTs (Non-fungible Tokens) provided proof of property ownership records, eliminating the need for lengthy paperwork and document submission to government offices.
The other municipality corporations in West Bengal also followed similar footsteps by launching blockchain-based platforms to issue birth certificates and other documents.
3. First-Of-Its-Kind Blockchain Module
NITI Ayog, a leading Indian government agency, launched a first-of-its-kind blockchain module in partnership with 5irechain and Network Capital. This module was launched with the aim of achieving efficiency in information sharing, educating people, and embracing blockchain technology.
The official blockchain module document shared by NITI Ayog included a thorough explanation of blockchain technology, aspects of decentralization, an understanding of cryptocurrencies, blockchain wallets, smart contracts, and different case studies.
5irechain is a sustainability-focused blockchain network that helped the government agency by providing technical support for this blockchain module. In addition to this, the mentorship and career exploration platform Network Capital played a vital role in crafting and conceptualizing this module.
4. IndiaChain
NITI Ayog is also working on the country’s own blockchain known as the IndiaChain. This blockchain network will be open, and India-specific and the government intends to use it for various applications such as personal identities and record keeping. Not only will the government use IndiaChain for launching services, but it will also allow business corporations and private companies to build blockchain-based solutions, Just as UPI is enabling a ground base for various FinTech products.
The plan for IndiaChain was officially released in 2020, and since then, it has been in the development stage. The Indian government is a direct stakeholder in IndiaChain, among others, including academic institutions, corporate companies, and non-profit organizations. This project’s scope is beyond just public services, as it will allow a variety of participants to benefit from the fast and secure transfer of data and information.
IndiaChain will serve as a secure and efficient digital infrastructure nationwide once launched. With this, India will also become a leading nation in empowering and adopting blockchain technology for public applications.
5. Maharashtra Launches Blockchain Sandbox For E-Governance
The government of Maharashtra launched the “Blockchain Sandbox” in February 2020 with the aim of making e-governance much more advanced and efficient in the state. The Maharashtra Information Technology Directorate, a state government agency, developed and established the project.
The Maharashtra government has also developed a variety of blockchain solutions in the area of health, supply chain, and other uses. The state government also launched an initiative using the layer 2 blockchain network Polygon to issue caste certificates to citizens.
6. Tamil Nadu Blockchain Backbone
The state of Tamil Nadu also launched a blockchain infrastructure in June 2023 to publish and share tamper-proof documents. The Nambikkai Inaiyam (NI) project is a blockchain-as-a-service platform that allows the state government to secure public documents and data. NI is put forward to improve the inter-organizational workflows among several state agencies and departments. All the departments can access the blockchain infrastructure using an API gateway or by running a node.
Indian Government’s Stance on Blockchain Technology
The Indian government is very optimistic about the use case and applications of blockchain technology. Although the country shares skepticism towards cryptocurrencies, it has been taking a keen interest in blockchain developments.
In December 2021, the Ministry of Electronics & Information Technology (MeitY) released “National Strategy on Blockchain,” in which the agency stated the potential integration of blockchain solutions across various government sectors. This initiative acknowledged the importance of blockchain technology and suggested several public applications that could be deployed on top of it. This also hinted at setting ground for establishing the “National Blockchain Framework,” which will be used as a hub to launch public services in the domains of finance, healthcare, agriculture, and e-governance.
Role of India in the Blockchain Industry
India is a leading country when it comes to IT development. With this emerging technology of blockchain, the country has become a major hub for blockchain-based development solutions. Alongside the government, several private companies and business corporations are exploring potential applications that could put India among the leading countries in adopting blockchain.
As mentioned earlier, the Reserve Bank of India (RBI) is also skeptical about cryptocurrency, but it has been working on the CBDC to make blockchain-based payment transfers available. Other leading government organizations, such as the Telecom Regulatory Authority of India (TRAI) and the Securities and Exchange Board of India (SEBI), are also exploring the adoption of blockchain in their workflows.
Final Words
While blockchain adoption is growing across different industries, governments across the world are seeking its potential use in economic development. Countries like the USA, China, and Singapore have already incorporated blockchain in their different fields to enable seamless data transfers and information sharing. India is still in the early stages of adopting blockchain, and it is expected to become a leader in this field. Let’s see how blockchain leads India to newer heights with ever-extending developments.
FAQs
Does India have a CBDC?
Yes, India launched the CBDC pilot in February 2022. The Indian CBDC is called Digital Rupee, and it is currently functional for bank transfers.
What is IndiaChain?
IndiaChain is an Indian government-backed blockchain infrastructure that will enable different sectors to deploy blockchain-based applications.
Where does the Indian government stand in terms of Blockchain adoption?
The Indian government is embracing blockchain technology in various sectors with several state governments and agencies launching blockchain-based applications for public use.
