by November 28, 2000 0 comments

The Ministry of Information Technology was set up with much
fanfare some time ago. The Government of India is making a lot of noise about
promoting IT, as seen in the passing of the IT Bill. There is talk of promoting
exports, improving telecom infrastructure, and encouraging e-commerce. These
efforts are laudable but I feel that the Government can do much better. It can
make the local IT industry explode by just simplifying the norms by which
government departments procure hardware and software and hire IT people.

The Indian State is, by and large, the largest potential user
of IT in the country. I use the words Indian State to mean both central and
state governments, their departments, undertakings and all corporations in their
control including public-sector units (PSUs). This combination of users presents
a potent market, probably much larger than that of all private-sector users put
together. The following examples will serve to illustrate the potential size of
the market.

  • would estimate that less than 5 percent of government
    departments have computerized their accounts. There is a potential market for
    lakhs of accounting packages, along with attendant hardware, networking, and

  • Billing services
    for utilities such as electricity, water, and telephones, are computerized
    in only a few dozen cities and that too in crude data-processing mode. There
    is enormous potential for IT enabling here.

  • Most direct tax
    departments such as those dealing with sales tax, entertainment tax, etc,
    are not computerized. Departments can substantially improve tax
    administration by using IT.

  • All government
    departments with whom returns are filed can benefit enormously by allowing
    filing on electronic media.

  • The judiciary is
    swamped with files and paperwork. A thorough Business Process Reengineering
    (BPR) and IT enabling can do wonders.

It is simple to
find many more examples such as these. Another way of understanding the size
of this market is to simply imagine a PC on the desk of every sarkari
white-collar worker.

What, then, is holding up the exploitation of this market?
The answer is simple–the utterly dated procedures employed by government
departments in the procurement of IT assets. The norms and procedures used for
the acquisition of hardware, software, and IT personnel are totally out of tune
with the market. Most of these procedures are designed with the stated intention
of eliminating corruption and assuring that the buyer gets the best deal. The
paradox is in the way these procedures work, for they wind up virtually
guaranteeing that the buyer gets anything but the best deal.

The flaws in the procurement process can be best illustrated
by studying how the average state department acquires custom-built application
software. Most state departments try to follow a process of tendering for the
award of development contracts. However, a detailed specification of the system
needs to be developed before calling for development bids. The system
specification has to be preceded by a detailed systems analysis. The department
doesn’t have the people at hand to do such an analysis and external
consultants are needed. Such consultants must be engaged, once again, through
the process of tendering. What normally happens is that the department tries to
look for the lowest cost consultant, with the result that the specification
document is often of poor quality, inconsistent, and full of holes.

Major anomalies abound in the subsequent tender. First, the
consultant who writes the specification is normally a participant in the
contract development tender. He has a major advantage over the other
competitors. Second, there is virtually no one available in the department for
clarification of system specifications. Technical queries go unanswered. Tenders
are normally evaluated on cost basis and the evaluation team is usually composed
of people with no systems experience. Innovative ideas make little impact on the
evaluation team, who will normally work by rule and eliminate anything that they
cannot understand. Finally, corruption rules the roost.

Given all this, it is no surprise that the quality of IT
systems used by the State is what it is.

The bottom line It’s time that the Indian government threw
away archaic procedures for IT acquisition. Everyone will benefit immensely. n

Gautama Ahuja, a contributing editor
of PC Quest, runs a turnkey software development company, AHC Infotek, in Delhi

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