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Blockchain Technology

to address this aspect; for example, it initiated the Smart Cities Mission (SCM) in

June 2015, intending to accelerate development in the urban sector and to improve

quality of life by providing local development and technology to use as a way to

build smarter citizen solutions (PricewaterhouseCoopers, 2017).

In July 2015, India launched a “Digital India initiative” with technology being

the prime focus to make service delivery efficient and robust for a digitally empow­

ered nation. At the present time, many emerging technologies can boost eco­

nomic development and provide a better quality of life to citizens, but blockchain

is one technological breakthrough that is considered impactful across industries

(PricewaterhouseCoopers, 2018).

8.3.1  Blockchain: The India Strategy

In January 2020, the government of India’s think tank NITI Aayog released a pro­

posed discussion paper entitled “Blockchain: The India Strategy – Towards unify­

ing Ease of Business, Easy of Living, and ease of Governance”. This paper initially

analyses the value of the blockchain in giving trust in government and private sector

partnerships, followed by observations on blockchain use cases, potential acquisi­

tion challenges, and studies of NITI Aayog driver experience in blockchain use,

indicating potential cases for the ecosystem. It specifically talks about leveraging

blockchain to create a new system for land records management, the pharmaceutical

drugs supply chain and educational certificates to fight fraud.

In the development of one use case, NITI Aayog partnered with Gujarat Narmada

Valley Fertilizers & Chemicals Limited and is functioning in the direction of exe­

cuting a proof-of-concept (PoC) application that is exploring the use of blockchain

expertise for fertilizer subsidy administration. These technologies will benefit from

reduced time distribution of grants, transparency, eliminating the need for more

approvals and distribution of documents, and the effective marketing and distribu­

tion of fertilizers. It will enable NITI Aayog to propose policy recommendations and

actions to strengthen the funding mechanism, making it transparent and rewarding

(NITI Aayog, 2020).

8.3.2  Vajra Payment Platform by NPCI

Due to the lack of a regulatory framework around its implementation, India initially

banned the usage of bitcoin/cryptocurrency, but in March 2020 the ban was lifted as

a positive move towards the financial sector. Recently, the State Bank of India (SBI),

India’s major government bank, in cooperation with a few other commercial banks

and companies, has launched a blockchain initiative called BankChain, whereby it

intends to reduce fraud and make transactions more transparent in the banking sec­

tor (RP, 2018).

National Payments Corporations of India (NCPI) recently announced the launch

of a blockchain-based payment platform called Vajra. Vajra is a permissioned block­

chain platform, where only the registered members within the network can become

part of the blockchain network.