The Indian Prime Minister Narendra Modi recently spoke about the transformative potential of blockchain technology and emphasized on the need for “rapid adaptation.” It is rare to find the head of state praising technology publicly.
The primary role of blockchain is to do for transparency what the Internet did for communication. The blockchain technology increases trust between two parties especially big deal in economies that with low counterparty trust.
Over 80 percent of Indians have jobs in the informal economy, which depend much on the interpersonal trust than formal contracts, which has only left them so vulnerable to fraud and deception.
India had a bribery rate of about 69 percent and was ranked the most corrupt nation in Asia in 2017. They have loan frauds averaging to approximately $2 billion annually, and to hedge against this, the interest rates on business loans usually run high, up to 20 percent signifying low trust.
India has been optimistic on blockchain for quite a while now, and currently “the city of destiny” which is relatively not known to the world is emerging as the country’s blockchain hub.
India’s Andhra Pradesh State launched ‘FinTech Valley Vizag’ in 2016, an initiative which aimed at transforming Vizag, or Visakhapatnam into a topnotch fintech ecosystem to bring together investors, entrepreneurs, academia, and government.
By later 2017, FinTech Valley Vizag had attracted about $900 million worth of investments and also created up to 5,500 jobs, even though it was targeting the creation of 500,000 jobs by 2020. Andhra Pradesh has so far become the first state in India to implement the blockchain technology in governance.
The state has initiated two major projects so far: streamlining registration of vehicles and managing land records. Blockchain’s central promise is to protect the digital assets of the state as well as it’s the digital transactions, while also preventing any possible tampering that could be caused by outsiders.
Andhra Pradesh state has collaborated with private companies to assess use cases. For instance, it has secured over 100,000 land records via Indian blockchain startup named Zebi Data, which also works with other states like Maharashtra and Telangana.
Swedish blockchain startup called ChromaWay is also in a partnership with the state to offer land registry solutions, leveraging lessons from projects abroad such as those with Lantmäteriet, Kairos Future, a consulting firm and Sweden’s land registry authority.