India 2025: Potential Impact of 12 Empowering Technologies

India to grow needs to adopt technology at a bigger scale. Ironically, large parts of the country still remain untouched by its power. However, this can change and technology can become an important driver of both economic growth and social development.

India needs to have a broad-based economic growth and more effective public services, to cater to the aspirations of millions of Indians for a better future. A recent report by Mckinsey says that technology can make a difference, as it can be one of the important factors for the change that India needs. The spread of digital technologies, as well as advances in energy and genomics, can raise the productivity of business and agriculture, redefine services such as education and healthcare and contribute to better living standards to the lives of million of Indians by raising the education levels and improving the healthcare facilities.

A McKinsey Global Institute (MGI) report identifies a dozen technologies, ranging from the Mobile Internet to Cloud Computing to Advanced Genomics, which could have a combined economic impact of USD 550 billion to USD 1 trillion a year in 2025.

The report has clubbed the various technologies into three broad areas:

  1. Digitizing Life and Work — Mobile Internet, Cloud, Automation of Knowledge Work, Digital Payments, and a Verifiable Digital Identity
  2. Smart Physical Systems — Internet of Things, Intelligent Transportation and Distribution Systems, Advanced Geographic Information systems (GIS), and Next-Generation Genomics
  3. Energy — Unconventional oil and gas (horizontal drilling and hydraulic fracturing), Renewable Energy, and Advanced Energy Storage

The 12 Empowering Technologies

The following chart shows the various technologies that has a potential for rapid adoption in India, that will help India transform:



Sectors Getting Impacted by Them

The impact that the above mentioned services will have on the various sectors in India is as follows:

  • Financial services: India’s banking sector has used technology to digitize business operations and to create new delivery models and services, such as online brokerage, mobile banking, and online insurance sales. Just 36 percent of Indians have access to a bank account. The government pays some USD 100 billion per year through paper based channels. Around 300 million Indians could gain access to banking services and raise their incomes by 5 to 30 percent due to better access to credit and the ability to save and make remittances.
  • Education and Skills: Technology applications can improve the quality of teaching and raise vocational attainment. School performance can be improved through e-administration, digital identity-based attendance systems, and online teacher certification and training. Blended learning with MOOCs (massive open online courses) can bring high-quality courses to students, and learning simulations can boost hands-on training in nursing and other disciplines. India could have about 24 million more high-school and college-educated workers and 18 million to 33 million more vocationally trained workers by 2025 as a result of digitization in the education sector. 
  • Health Care:  Based on international standards, India has about half the doctors, nurses, and health-care centres it needs for its population, and existing facilities are not geared to delivering optimal health outcomes. Disruptive technologies could transform delivery of public health services by 2025, extending care through remote health services (delivering expert consultations via the mobile Internet), digital tools that enable health-care workers with modest skills to carry out basic protocols, and low-cost diagnostic devices that work with smartphones. By 2025, the total economic impact could be USD 25 billion to USD 65 billion a year, including USD 15 billion that could be saved through systems to reduce the problem of counterfeit drugs. Some 400 million of India’s poor could get access to better care through technologies that bring medical expertise to modestly skilled health workers in remote areas.
  • Agriculture and Food: Hybrid and genetically modified crops, precision farming (using sensors and GIS-based soil, weather, and water data to guide farming decisions), and mobile Internet-based farm extension and market information services can help create more than half the USD 45 billion to USD 80 billion per year in additional value the sector could realise in 2025.These improvements could raise the income of as many as 100 million farmers and bring better nutrition to 300 million to 400 million consumers.
  • Energy: Around 300 million people still lack access to electricity in India. Globally disruptive energy technologies will have tremendous potential to improve sources of power in India as well as unconventional oil and gas development and solar technology might generate value of USD 10 billion a year by 2025. The largest benefit would come from smart metering, which could save USD 15 billion to USD 20 billion a year by 2025 in reduced transmission losses.
  • Infrastructure: India has a widely acknowledged infrastructure deficit that successive governments have attempted to address. Overcrowded roads, aging rail lines, and port systems using antiquated technology all slow the flow of goods and people and limit the growth potential of the economy. Smart highway systems and electronic tolling can reduce road-travel times by 10 to 15 percent.  India needs new water and sanitation systems and has a housing gap of more than 18 million units. Infrastructure projects frequently come in late, over budget, and short of specifications. Use of radio frequency identification (RFID) tags and other tracking technologies can automate terminal and warehouse management, raising efficiency by 50 percent. Sensors can help  water systems to cut leakage by 15 to 20 percent, helping reduce water shortages. And project-management systems and next-generation building technologies (extensive use of factory-made prefabricated parts) can help India deliver ten million affordable homes by 2025. Together these infrastructure technologies can contribute USD 30 billion to USD 45 billion per year in value in 2025.
  • Government Services:  50 percent of government spending on basic services does not translate into real benefits for people, and cumbersome government processes are an obstacle to investment and growth. National e-governance plan should use technology to its full potential over the next decade to bring about a change. Government should help new businesses and business models prosper through its open-data initiatives. In addition, it can help accelerate the build-out of fiber-optic backbones, which will be critical for spreading the mobile Internet which in itself is the foundation for many applications in other sectors of the economy.
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For these technologies to have strong roots in India and the level of impact as foreseen in the report by the McKinsey group, the Government should take adequate steps to ensure their enforcement by building the physical infrastructure for the digital economy and addressing the barriers in adoption of it while enforcing effective policies, regulations and standards.

The following image shows the continuing challenges faced by India across various sectors:


The digital world which includes mobile internet, cloud storage, digital payments, etc. is being rapidly adopted by the masses and they have a tremendous growing impact from now till 2015.



A system of verifiable digital identity is critical for services such as e-commerce, digital payments, and other electronic transactions, for accessing online government services (to apply for benefits or licences, for example), and for establishing workers’ identities at hiring.

Under the Unique Identification Authority of India initiative, which administers the Aadhaar card programme, 24 million unique biometric citizen identities are being issued each month. By June 2014, about 580 million cards had been issued.16 Verifiable digital identities are expected to be ubiquitous in India by 2025, potentially making possible many new kinds of services.

To capture the full potential value of these technologies, India need to address all the barriers in the implementation and improve the computer/digital literacy among the people of India. Government should take adequate steps to ensure the implementation of these technologies and also taking care of the interests and rights of the people, thereby fostering an environment of innovation and growth. If the authorities adhere and religiously stick to the developing norms that India need to follow today, then that day is not far when, India will be known as a developed nation than what it presently is, a developing nation.

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To read the full research report by McKinsey&Company, Click here.