Blockchain & Indian Economy: An Impeccable Marriage that can Propel India's Growth in Every Segment
Demonetization that was introduced to target wealthy tax evaders actually affected the average Indians; with Indians pictured queuing for hours at banks or ATMs. In fact, the decreased GDP growth in recent quarters found its root in the cash crunch that emerged from the demonetization policy. Puny as the policy might have been for average Indians, though, there were shining spots for proponents of a cashless economy. The World Economic Forum reported that the number of digital transactions in India improved following the demonetization policy. However, there are sundry challenges confronting the propagation of a cashless economy. According to certain media reports, Indian consumers are moving back to cash-based transactions because of remonetization& high digital transaction expenses. For instance, it costs a merchant between 4,000& 8,000 to set up a card-swiping terminal in India. If the Indian government wants to boost its cashless economy, Blockchain can be its ally in this endeavour.
Alas! The current debate in India has, lamentably, focused too massively on trading & speculation, looking at cryptocurrencies as an investment tool, rather than recognising the potential of Blockchain technology. Only 0.5 percent of the people in India are into Bitcoin, the cryptocurrency that popularized the Blockchain technology.The Indian government has legitimate concerns around money laundering, tax evasion & capital flight using cryptocurrencies. In 2018 Budget Plan, Finance Minister ArunJaitley said cryptocurrency shall be regarded as an illegal tender. Even the RBI has warned about the potential financial, legal, customer protection & security-related risks in cryptocurrency. Well, at their position they are also right, but there are many countries that have taken nuanced steps in regulating the technology, and are focusing on stopping illegal activity without throbbing innovation.
Solving India?s Sundry Concerns
Notwithstanding the meteoric acceleration of Fintechservices in India, financial inclusion remains to be a grave issue mainly due to identification processes. According to ASSOCHAM-EY?s report, 19 percent of the Indian population continues to be unbanked. Based on the cashless technologies employed today, most people would need a bank account in order to live in a cashless economy. Blockchain resolves these challenges by creating digital identities for the unbanked.
Blockchain has the potential to make processes more democratic, secure, transparent, & efficient. The immutability of a Blockchain makes it nearly impossible for changes to be made once established, which increases confidence in data integrity and reduces opportunities for fraud. Streamlining the cross-border payments, while the traditional process takes up to three business days in transferring funds across borders, Blockchain expedites the same process within 20 seconds, thanks to its decentralised aspect.Not only the economy, but the Blockchain is also now the fastest-growing skill set demanded on job sites, with job growth rates at 2,000-6,000 percent and salaries for Blockchain developers 50-100 percent higher than regular developer jobs. However, India's leading institutes are yet to adopt Blockchain courses that resulted in a huge dearth of people skilled in Blockchain in India.
Blockchain offers marvelous opportunity for India across jobs, capital, solutions to India?s problems, and global strategic positioning. Looking at the positives from Blockchain technology, the government needs to take the plunge in the domain and generate an environment which will foster innovation in this particular area.
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