Human development indicators improve rapidly when countries learn to provide health, education and financial inclusion more effectively. Incremental increases in expenditure on welfare schemes and subsidies do not bring about this change. Plugging the leakages in government distribution helps, but it is not a panacea. What we need are game-changing innovations that can tackle India-scale challenges.

In the past 30 years, it has become clear that game-changing solutions do not follow a prescribed path to discovery. Instead, they are born out of hundreds of experiments. These experiments can’t be limited to the labs of a few resource-rich incumbents.

We need to widen the funnel to include the new-age entrepreneurs and innovators. To do this, the government needs to adopt and evangelize pro-challenger tools and policies that reduce barriers to experimentation, create level playing fields and encourage innovating around national issues.

There is some good news on this front. In the past few years, a collaborative effort between several government agencies and the Indian Software Products Industry Round Table (iSPIRT), a non-profit think tank, have helped create key enablers for hundreds of experiments.

A digital infrastructure for cashless, paperless and presence-less (on smartphone) service delivery is now in place. It is colloquially called the India Stack. It offers all the building blocks that are needed as public goods. And the rapid adoption of Jan Dhan Yojana, Aadhaar and mobile numbers (JAM) has created a ready pool of citizens to try out these services.

This enables new-age start-ups to do more complex things than they could do before, making them transformation agents for real India.

These new-age start-ups will deliver 10x gains that we need in health, education and financial inclusion to make India successful.

But we must think beyond start-ups. The Indian state must evolve too. It must learn faster, change faster and implement faster.

A 2013 paper by Luke Jordan of the World Bank and Sebastien Turban and Laurence Wilse-Samson of Columbia University shows that the Indian state performs poorly on these dimensions compared to the Chinese state. They identify many factors for this.

For instance, China has undertaken reform once every five years since 1978, while India has only attempted it twice in 65 years. Therefore, China has been continuously tuning up its capacity to learn and deliver.

In India, substantial administrative reforms are overdue. (The reforms recommended by the Second Administrative Reforms Commission still remain unimplemented.)

It turns out that think tanks have an important role to play too. A dense network of think tanks is necessary to conduct and spread research.

Indian think tanks are mostly central or foreign, with only a few having strong links into the policy system. China has think tanks observing and explaining change. This is a structural gap.

Because of this, the Indian state is conspicuously lacking in its capacity to generate new knowledge, transmit it across the system and act on that.

It is time for us to embrace the two new players—new-age start-ups and local think tanks—for India to prosper. Only then will we able to break free from our current trajectory to meet the aspirations of our young citizens.

Jay Pullur is founder and CEO of Pramati Technologies. He is also a co-founder and governing council member of iSPIRT.

Shashank N.D. is founder and CEO of Practo Technologies. He is part of iSPIRT’s Founder Circle.

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