For long, international affairs have had groupings of democracies, a democracy being a fundamental pillar of the world order after the Second World War and the end of colonialism.
This essay argues that there is an additional grouping emerging now—digital democracies—and India is a natural leader of this group. As is evident from the name, it is the practice of democracy, both at the level of the nation state and the citizen, using digital tools.
Digital democracy is, in a sense, the next phase of democracy as it encompasses all the opportunities and challenges of asserting sovereignty for nation states. It is important to understand that countries must now cooperate not only in politics, trade and humanitarian issues, but a vital aspect of cooperation is transborder technological cooperation to assert sovereignty, including to multinational tech giants.
The most important task in such an era is the construction of technological architecture as a public good—which is owned not by any one private entity. In building and deploying such architecture at scale (for more than a billion people), India has shown unique innovation skills and achieved unprecedented success.
According to recent independent research reports, digital transactions in India could rise to $10 trillion in value by 2026. Two out of five transactions in India are estimated to be using digital tools, and it is set to rise exponentially in the next few years.
Whether in financial technology or identity architecture, India is today building bigger and better digital public infrastructure at scale than any other democracy in the world.
It, therefore, is the natural leader of the world of digital or digitising democracies. India is not only building such technologies and infrastructure at home, but is also pitching to deploy it around the world. The India pitch is mass-use digital technology that can be utilised as public infrastructure by countries to digitise their governance processes and public goods delivery mechanisms.
There is an underlying logic to this—democracies must cooperate both non-digitally and digitally to take on the challenges of the so-called decentralised Web3 world of blockchain and artificial intelligence that is emerging. India can and should lead such cooperation. It has both the size and the cutting-edge technology and can offer both expertise and scale.
The use of digital technology among democracies is one of the most important platforms for public diplomacy today and this will become more necessary in the near future.
A country with the size and complexity of India can showcase not only how technology can be used but also how to effectively curb its adverse impact and misuse. Therefore, this is one area where India is a natural leader. It can bring to the table the full weight of its enormous expertise in running programmes like Aadhaar, direct-benefit transfer, and ongoing efforts to improve digital health and education. Apart from this, India has innovations like the Unified Payments Interface (UPI) (which powers fintech and has created a unique level playing field) and is working towards creating a unified digital platform for commerce.
This leadership role for India, already apparent, is set to expand considerably in the years to come as democracies that extensively use digital tools come together to boost ease of living for their citizens and tackle crises that require worldwide collaboration.
Chief Economic Research Officer at Invest India, national investment promotion agency of GoI