Navigating the Digital Frontier: Exploration of Global Digital Transformation

The OECD defines digital transformation as the process of using technology for the desired economic and societal effects. Thus, while often used in business parlance, digital transformation holds significance not only for business firms, but also for governments, public sector companies and different organizations involved in tackling global challenges. Digital transformation at its very core is about transforming processes for global prosperity.  

Evolving Realm of Digital Transformation 

While it took humans 9,000 years in moving from agriculture to the first industrial revolution, it took just 100 years each for the second and the third industrial revolutions, and less than half of that for us to reach the fourth. While the third industrial revolution has been dubbed as the digital revolution, the fourth industrial revolution is about digital transformation. Digital transformation is not limited only to the industry but goes well beyond to encompasses all sectors. It is improving not only the processes, but also the scale of impact and opening new possibilities in terms of end goals.  

Global Impact 

Today, digital is touching every aspect of our lives. According to the World Economic Forum, digital transformation is expected to provide US$100 trillion of additional value to the world economy by 2025.  

It is altering manufacturing, logistics and supply chains in a way that is bringing efficiency, enhancing ease of doing business, reducing cost of doing business, and improving overall service delivery.  

It is improving the way government’s function and provide public services. It is helping them collect, collate, and analyse important data to build evidence-based policies, along with allowing targeted public service delivery. Digital transformation is also altering how governments operate – reducing discretion and corruption and breaking silos thus improving efficiency.  

Within the banking and financial sector, digital transformation has allowed deeper financial inclusion and digital currencies are the next big leap governments are making in this direction.  

Synergy with Sustainable Strategies 

There is also a growing synergy between digital transformation and sustainable strategies. According to the World Economic Forum, 20 percent fewer emissions could result from scaling up digital solutions in hard-to-abate industries. Apart from this, changes in sectors like health and education are also helping reduce inequalities and moving the world towards greater inclusion and global prosperity. The COVID-19 pandemic, apart from all the other disruptions, has dramatically accelerated this digital transformation from both the service provider and service consumer sides.  

Digital Transformation in India: A Case Study 

According to a study released by the Reserve Bank of India, between 2014 and 2019, India’s digital economy grew 2.4 times faster than the Indian economy, with strong forward linkages to non-digital sectors. The report also mentions that digital output multiplier has increased over time highlighting the role of investments to drive growth. Currently, 62.4 million (11.6 percent) workers are employed in the digitally dependent economy in India.  

This digital journey of India has been powered by the expansion of smartphones, internet subscribers, unique digital identity in the form of Aadhaar, opening of millions of bank accounts, and building a seamless digital payments model of Unified Payments Interface or UPI. These digital public goods are transforming the lives of millions in India. The Indian government is now looking at further scaling up these successful models and also offering them for replication at the global level. Many countries have shown interest in adopting some of these models.  

During the COVID-19 pandemic India relied heavily on the digital delivery of essential services such as vaccines, healthcare, and education. This digital push into various aspects of public service delivery has been continued through wide ranging reforms including the intent on the systematic introduction of India’s digital currency.  

There is also a growing synergy between the government and the new age tech-startups in India which are focusing on digital technologies and automation standards for solving societal problems. With India keen to share its successful models with the world, there is an opportunity for India and the world to collaborate for building a citizen-centric and inclusive digital economy at an affordable cost.  

Global Collaboration 

While the world undertakes this transformation which has far reaching benefits in moving towards global prosperity, it is equally important that the challenges that come with it, be it regarding digital education and skilling, cybersecurity, data storage and privacy, be adequately addressed. Given the border-less nature of these challenges, inter-country and multi-stakeholder cooperation is important. 

CII’s Global Economic Forum, organized in partnership with the Department of Economic Affairs, Ministry of Finance, Government of India, featured a key track on ‘Digital Transformation.’ This track aimed to emphasize the growing importance of digital technology in revolutionizing global processes for prosperity. Digital transformation is not only enhancing the processes themselves, but also expanding their impact and introducing new opportunities for achieving end goals.