Intelligent Village –

Vibrant India

Building Foundations for Rural Entrepreneurship

 The Rural Scene
• About 2/3rds of India’s rural
population engaged in
agriculture, accounts for less
than 1/4th of the National
Income

• In 600,000+ villages
(about 1000 people per village
with per-capita income of
Rs. 20 per day)
– per capita GDP of Rs 10,000
per year 120
102.1
Number of HH in millions
100 135 million rural
80 households
• Of the 135 million Rural 60

Households, nearly 102 million 40

17

have a per-capita income of

20 10
3.9 1.9 1 0.3 0.3
0

Rs. 300 per month 3 9 13 18 26 42 65 112

HH Incom e in thousand Rs/m onth
 Can we make a Difference?
• Can technologies make a significant
difference?
– Can it bring to them health & Education
– Can it significantly enhance their
incomes?

Remote Eye Care with

Aravind Hospitals
Components of Our Rural Development Strategy

National Rural
Employment
Guarantee Programme
National - (NREGP) Act – Bharat Nirman–
eGovernance Plan– targeting lack of enhancing rural
enabling ICT as a opportunities infrastructure
tool for development
Comprehensive
Rural Development
Strengthening Sarva
Strategy Shiksha Abhiyan with
National Rural
Health Mission with Universalization of
Rural Sanitation– Midday Meal
improving rural Right to Information programme – raising
health & well-being Act – enhancing levels of literacy and
transparency educational attainment
Government of India’s NeG Plan

NeGP Vision

“All Government services available to the common man in his

locality, throughout his life, through a one-stop-shop (integrated
service delivery), ensuring efficiency, transparency, & reliability”
 National Action Plan on e-Governance
CSC - A
Network of
Rural
Citizen
Database Service Points
Road Central across the
Pensions Police
Transport Excise length
India and breadth of
Portal
India
HRD
Networks
CM
Core
Land Insurance Banking Land
Policies
Records Regn
BPR Gateway
Archi-
tecture
DCA21 Passport
Visa
Commrl Income
Treasuries
Taxes Tax

Agriculture
Do ‘CSC Type’ initiatives exist in present times?
What we’ve looked at so far…
Yes! A host of them and Successful too!

The CSC is an attempt to integrate and scale-up

such Initiatives through National eGovernance Plan
The ‘CSC Scheme’ – Rationale, Objective

• CSC - an important component of the NeGP is a network of

service points across the length and breadth of rural India

• CSC aims to provide access to information, backed with

relevant infrastructure and end-to-end services that would
allow rural population, the opportunities to enhance their
quality of life

• By enabling access to a large number of services like

e-Government, education, health, credit, etc. the CSCs
offer a solid foundation for the economic prosperity of
rural India
The ‘CSC Scheme’ – Rationale, Objective
Contd…

• A “CSC” is an internet kiosk in a village with

PC+Internet+Printer, etc.

• A CSC would be serving the people residing in the village where

it is located and also a catchment of population 5-6 villages
surrounding the CSC Village

• Range of CSC Services – B2C(Sale of Agri-Products, IT Training,

Railway Tickets, DTP Services, Digital Photography); G2C (Form
Downloads, Land Records, Certificates, Online Application
Regn., Mandi Rates)

• The CSC Operator (Village Level Entrepreneur) will be selected

from the village and provided training. VLE will be responsible
for running the CSC business and providing services to the villagers.
 Who drives the CSC Scheme?
• Government of India
– Department of Information Technology (DIT) - Nodal Agency
for NeGP –CSC Scheme- Implementation
– IL&FS – National Level Service Agency (NLSA) - is currently
managing the massive initiative of setting up CSCs in
1,00,000+ villages in the country

• State Governments
– State Level Agency (SLA) responsible for coordinating
implementation of CSC Scheme

• Grassroots
– Service Centre Agency (SCA) – Promoter of Rural ICT
Initiative – Prime Driver of Business and Service Channel
Manager
– Village Level Entrepreneur (VLE) – CSC (Village Kiosk) Operator
 Challenges for the Scheme
Explicit

• Low levels of educational attainment of the rural populace

• Lack of awareness of ICT advancements

• Poor socio-economic status

Implicit

• Lack of understanding of PPP frameworks

• Lack of appreciation of alternate viable livelihood opportunities

• Lack of exposure to innovative practices, technological illiteracy

 Opportunities Ahead………..

The Evolution Path

• CSC to evolve into a full-fledged catalyst for a two-way

exchange of goods and services between rural India and the
world

– CSC as a Focal Point

– Value Sourcing from Rural India
– Value-added Products/Services
– Achieving the Service Pyramid
Aiming at the Services ‘Pyramid’

Building Livelihoods Data

Collection,
Rural BPOs
Quality of Life
Entertainment &
Community Radio

Social Development Education, Healthcare,

Agricultural Extension, etc.

Income Opportunities E-Commerce / Online

Marketplace/Market linkages

Save Costs
E-Government Services/Utility Services
Opportunities for Saving Costs

Government Services
• Land records
• Registrations
• Government certificates and forms
• Electricity bill payment
• Grievances redressal mechanism

Commercial Services
• Data entry (affidavits, estimates, resumes, etc.)
• Printing, photocopy, bill payments, online ticketing, digital
photography, document scanning, etc.

Banking and Finance

• Extension counters for lead banks and micro-finance
institutions
Income Opportunities, Quality of Life
Income-Building
• Agri-Procurement – e.g. ITC-IBD, Godrej Agrovet, Tata Chemicals,
Chambal Fertlizers, IFFCO…lately…Reliance and Bharti
• Data Collection
• Vocational Training and Entrepreneurship – e.g. MICO Bosch
• eCommerce – national/international handicrafts procurement
agencies, trade portals such as e-Bay
• Bill Collection, Public Grievance Handling

Developmental Services
• Education and health services – Apollo Hospitals, Aravind Eye
Care, AISECT, NIIT

Quality of Life Services

• FMCG Goods – e.g. toothpaste, nail-cutters, soaps, baby food, OTC Medicines,
• Community radio
• Cable Service Providers –community television
• Astrology, matrimonial services, employment services, etc.
Example: A VLE through CSC will offer a Farmer….

HARVEST & TRANSPORT PRODUCTION RISK

MARKET INFO, OF PRODUCE facilitation COVERAGE &
Price Info & PRICE RISK
Linkage COVERAGE
facilitation

STORAGE CREDIT
facilitation facilitation

INPUT facilitation
KNOWLEDGE /
Extension Services IRRIGATION Seeds, Fertilisers,
Facilitation/ Alternate facilitation Pesticides, Farm Machinery,
farming Soil Testing
Example: IETS Partnership with ITC

ITC-IBD and IETS

working together on promoting
e-Education
(Pilot in 11 villages in Yavatmal)

Value Proposition

– Sanchalak: Round the year revenue potential and social standing

– Student end: Access to education solutions, which help improves

their quality of education and their academic performance

– Teacher: Access to programs which helps improve their ability to

deliver quality education and increase their revenue potential
Government Support….Viability of Rural Kiosk

• Government has underscored the need for support to achieve

sustainability around e-Government services in rural kiosks

• Emphasis is on achieving ‘optimum support level’ that neither

discourages or over-incentivizes the SCA/VLE, leading to under-
performance

• Over the first phase of the project (i.e. first four years of operation) the
‘minimum’ Opex is nearly 2.5 times of the initial infrastructure cost

• Clearly, the bigger challenge is to cover the revenue gaps and associated
risks which arise in rural markets

• To that effect, Government of India (DIT) has proposed a revenue-based

governmental intervention and support, rather than a capital subsidy.

• Essentially the Government support will take the form of:

– Guaranteed Provision of Government Services:Viability Funding
– Debt Service Reserve Fund : Liquidity Support
Government Support…Technology & Connectivity

• Technology Architecture framework being drafted for hardware,

software, connectivity options at
• CSC Level
• SCA Level
• SPV Level

• The framework would be made available to the SCAs as well as

States

• Initiated discussions with BSNL and other telecom operators for

leveraging their rural footprint

• Assessing various options on Language Interface for providing

multi-lingual capabilities

• Interacting with State Governments to assess their SWAN

implementation status
Business Model for the CSC Scheme

• The SCA will drive the CSC business. Headquartered at a

District or Taluk, the SCA will manage the CSCs set up in
select villages, manned by VLEs

• SCA and the selected VLE will enter into a business

agreement

• SCA will invest in physical infrastructure, develop portfolio of

B2C, G2C services, tie-up with Technology Service Providers
(TSPs), facilitate bank linkages for the VLE-CSC, train the
VLE on new contents, mentor the VLE

• VLE using his clout in the village needs to assess the felt
need for ICT-based services, build social capital and
business opportunities, make CSC the one-stop-shop for the
villagers
Business Model for the CSC Scheme
Contd…

VLE Business Model

• VLE will invest an amount ranging between Rs. 15,000/- and Rs.
30,000/- as ‘Deposit’ with the SCA.
• VLE will spend on Selection and Training expenses ~ Rs. 2500/-
• VLE will have to part with a Revenue Share + Fixed Monthly service
Charge to SCA

In return…VLE will have

• Income from CSC Services

• Infrastructure Support for CSC – PC, Internet, Printer, etc.
• Access to Training and Mentoring
• Bank-linkage – Handholding support from SCA Field Staff for
Loaning Process from Banks
• Revenue-Shortfall Support from Government through the SCA
Business Model for the CSC Scheme
Contd…

SCA Business Model

• SCA will invest in Physical Infrastructure, CSC Hardware

and Software

• SCA will incur Operational Costs

In return…SCA will receive

• Revenue-Share + Fixed Monthly Service Charge from VLE

• Revenue-Shortfall Support from Government

Critical Enabling Factor ...Rural Entrepreneurship

• To carry out all the activities outlined before…a single

critical factor stands out …i.e., “Rural Entrepreneurship”

• Rural entrepreneurship, is community based, has strong

extended family linkages and a relatively large impact on a
rural community.

• A rural entrepreneur is someone who is prepared to stay

in the rural area and contribute to the creation of local
wealth.

• The economic goals of a rural entrepreneur and the social

goals of rural development are strongly inter-linked.
Rural Entrepreneurship - A Novel Approach

• How does a Rural Entrepreneur or Village Level Entrepreneur (VLE)

get Created?

Usually, Personal Characteristics +

Socio-Economic Aspects make a…VLE..

• However, VLE can also be created through a set of supporting

institutions and through deliberate innovative action…. And this is
where IETS steps in….

Deliberate Innovative Action … in terms of Education and Training.

Rural Entrepreneurship Training greatly affects supply of rural
entrepreneurs….thus is indirectly an important source of rural
entrepreneurship.
 Who can be a VLE?
Geography-wise
Candidate belonging to a Rural Location – Village, Gram
Panchayat, etc.

Occupation-wise
Any Occupation….One who is running a small business in village,
educated unemployed youth, retired government functionaries, Ex-
Servicemen, farmer, etc.

Socio-Economic Condition
Not relevant…

Personal Traits
Self-disciplined, willing to serve the community, willing to learn and
earn by put learning to practice
CSC – An Opportunity for Army Personnel
to Build the Rural Foundation
• The CSC Scheme presents a good opportunity for the Army
to retrain and redeploy its strong workforce in peace-time
grassroots initiatives

• CSC provides a unique opportunity for Post-retirement

pursuits. Every year around 20,000 army personnel of
various ranks, retire from their Commissions.

• CSC Scheme is all about Nation Building and Social

Entrepreneurship which is all about serving Village
Communities through Rural Entrepreneurship

• Army recruitment drive could be further decentralized using

CSC as Centres for Awareness Building, Promotion and
Receiving Applications

• CSC can provide a unique platform to forge a win-win

partnership [Advanced Technology + Disciplined Workforce
at Grassroots] aimed at Rural Prosperity
 How to participate in CSC? Contd…

• IL&FS-IETS is exploring the possibility of associating with

the Indian Army in bringing the ex-servicemen and retired
army personnel irrespective of their ranks into the CSC
fold.

IETS believes…
• The Indian Army provides a rich resource-base of
disciplined, capable and determined human force to
reckon with for peace-time nation building activities

• A large number of Army personnel serving across the

country in different ranks complete their commission term
every year and return to the civilian fold – in most cases
settle in rural areas
Thank You!