This is one of the three stories winning a media award from GKP at Tunis. "For thoughtful and incisive reporting on the Information Society through analyses of social and political impacts and policy implications."

http://www.thehindubusinessline.com/ew/2005/04/18/stories/2005041800030100.h...

Waiting to fly

Vipin V. Nair

Akshaya, the Kerala Government's project to make the common man log into a computer, can take to the skies if it learns from teething trouble. A status report from eWorld.

THE overnight rain had soaked Nilambur and its teak woods. A drizzle in the morning brought a fresh layer of chill. Nilambur, famous for its teak plantations, was about to sneeze.

But it was not the weather that dampened the spirit of Nazar. Sitting in a small room that he calls office, Nazar looked more a loser than an entrepreneur.

His Akshaya centre is in financial trouble, he has run up losses, and the future is bleak, Nazar says.

He is not comfortable talking about selling a computer at one-third its price to pay rent for the centre.

On the other side of the district, Mujeeb has a different story to tell. His centre in Tirur has four staff to run the show.

It provides e-payment, DTP services, Internet browsing and computer training. Why, he has even developed a billing software for local cable-television operators.

In a nearby area, Noushad too has managed to take his Akshaya centre forward, offering similar services to the local population, many of whom saw a computer for the first time in their lives at the Akshaya centre.

Two years after Kerala's Akshaya project was launched — and gained national and international attention for its pioneering vision — such divergent voices about its viability and future are heard from Malappuram, the district where it was piloted.

What is happening to Kerala's most ambitious information technology project ever? Is there anything wrong?

Concept

The basic idea of Akshaya was to bridge the `digital divide' and thereby propel Kerala as `India's foremost knowledge society.'

The Kerala State IT Mission, the nodal agency for the development of information technology in Kerala, conceived the project, envisaging a network of some 6,000 information centres across the State.

These centres would impart basic computer skills to at least one member of the 65 lakh families, offer various e-services such as bill payment for utilities, bring information through the Internet to people, and most importantly, dispel the fear among ordinary citizens that the computer is beyond their reach.

In the process, at least 50,000 people would find jobs, and Rs 500 crore would be invested in the State within three years.

"The concept was to have an Akshaya centre within two km of every household, just like a ration shop," says M. Sivasankar, now Malappuram District Collector, and the man who spearheaded Akshaya.

These centres, set up by local entrepreneurs, would start off by imparting computer skills to people under their coverage area. Over 15 hours of training, a person would acquire the basics of Windows, MS Office, Internet, etc, from the Akshaya centre.

And for every such person trained, the centre would get a fee of Rs 120 from the State Government through the District, Block and Grama Panchayat.

The first two institutions would chip in with Rs 20 each, while the Grama Panchayat would spend Rs 80 for a person.

Every centre was supposed to train at least 1,000 people in three months, thereby ensuring an income of Rs 1.20 lakh. Subsequent to this e-literacy campaign, a host of services would be rolled out, including the second phase of the training.

Malappuram, in northern Kerala, was selected as the test bed for the project.

Initial days

The Kerala Government launched the Akshaya project in November 2002. Entrepreneurs were selected by February 2003 and given training.

Over the next few months, a number of Akshaya centres, sporting their blue logo, sprang up across Malappuram, one of the backward districts in terms of social and economic development in Kerala.

Eventually, 634 Akshaya centres would be set up, it was planned.As per the project report of the Kerala IT Mission, each centre would entail an investment of Rs 3.83 lakh for its 10 computers and other paraphernalia, plus working capital.

The Government ensured the Akshaya project priority funding from banks and term loans to cover half the project cost were arranged.

The project went on steam in May 2003, and by February 2004, over 5.80 lakh people in Malappuram knew how to log on to a computer, open a file, save it, surf the Internet and send e-mail. The world took note of Malappuram.

But this process was not as easy as doing a search on Google, many Akshaya entrepreneurs soon realised.

Every centre was supposed to train a certain number of people (over 1,000 from each ward in their respective area) over three months.

But sometimes, even a free meal is not enough of an attraction. Many people showed reluctance to turn up at the centres at a given time, putting aside whatever they were doing.

"We had to then open sub-centres to take the classes close to them," says M.M. Sadique, President of the Akshaya Entrepreneurs Forum. This entailed additional spending.

He alleges that there were many instances of unnecessary expenditure that entrepreneurs were forced to incur.

Like the case of handbooks for learners at Rs 8 per copy. These books were to be sold at Rs 10 each but Sadique says the centres could not sell even 100 copies. "Each of us had spent Rs 8,000 or more for this handbook. We were promised that unsold books would be taken back, but we are yet to be refunded," he says.

The delay in completing the training — it took nearly six months as against the proposed 100 days — was reflected in disbursement of funds as well. "It took about six months for us to get the money," one entrepreneur says.

Government officials say no amount is now pending for the first phase of the e-literacy campaign. A part of the funds was remitted directly to those banks that had given loans to Akshaya centres.

A total of Rs 7.58 crore have been disbursed for the campaign, officials say.

Yet, many centres were closed down. "Forty seven centres were closed during the e-literacy project and 50 afterwards," says an official associated with Akshaya. Only around 450 centres are now functional in Malappuram, out of the planned 634, he admits.

"But this was the first time such a project was ever tried anywhere in the world. In such a project, you usually don't get more than 30 per cent success rate," he argues in the same breath.

Sivasankar says Akshaya was "slightly ahead of its time. Even in cities like Kochi, many services are not available over the Net," he points out.

Nevertheless, he too agrees that there were problems. Another critical issue to be looked at is how many of those 5.80 lakh who learned their skills at the expense of public money can now actually use a PC, after two years. Apparently, many among them haven't used a PC again.

Missing: Fire in the belly

The selection of entrepreneurs was, perhaps, the first problem with Akshaya. "There were substantive miscalculations," Sivasankar says. All the 634 people who were chosen to run the centres, it was thought, would make it on the lines of a Sabeer Bhatia or Narayana Murthy.

But many lacked the business acumen, the courage to take risks, and the ability to see difficulties through. The result: when plans didn't work, they tottered and waited for help, rather than finding innovative ways to solve issues.

Since the project was a government baby, many thought there would be continued support from the administration. "The Government had made it clear in the MoU that there will not be any commitment after the e-literacy campaign," the Akshaya official says.

Mujeeb, who runs the Tirur centre, says many unemployed youth jumped on to the Akshaya bandwagon, thinking the Government would support them throughout.

"The element of risk was not anticipated and they expected grants all the time," he says. The political pressure that led to selection of some entrepreneurs only added to the problem, officials say.

Promises fail

Entrepreneurs say many of the revenue streams the Government promised for Akshaya after the e-literacy phase never saw the light of day.

"We were told during our training period that there would be a number of avenues for business generation through the centre," says one participant. The project report, in fact, lists a host of such opportunities. The Akshaya centre, it says, would function as a direct link between the people, Government and private organisations.

It can offer services such as data collection, training and education, Web-based consultancy services, printing and publishing, information sales and other general services.

For instance, the centres can do data collection such as census (for government) and market data (for industry).

Several other services such as computer training to more people, providing courses such as spoken English and personality development, e-learning, online exams, Web-based marriage consultancy, real estate, telemedicine, DTP, sales of government information and application forms, Internet browsing and what- have-you were up for grabs for enterprising folks.

A model centre in a normal year can thus make Rs 5.43 lakhs, the report postulates.

While those like Mujeeb and Noushad managed to provide some of these services, many others couldn't. The Government, from its side, did offer large-scale data entry work, but this ran into rough weather.

One centre in a panchayat was selected by Information Kerala Mission to convert panchayat records into digital format.

Sadique alleges that many centres are yet to receive their dues after completing the work. Akshaya officials also agree that there are problems with regard to this initiative.

Efforts are now on to get the funds released.

A health-kiosk concept was initiated, but it remained a concept only. It is not clear now as to how far it is possible for Akshaya centres to provide the kind of services envisioned in the project report.

Whether every citizen would go to an Akshaya centre to pay his bills, buy his application forms/submit them and to deal with authorities remains to be seen.

Besides, labour unions in utilities are grumbling, as they fear that Akshaya would render many employees jobless.

Connectivity

Meanwhile, Akshaya centres were networked with one another through wireless Internet. Through a global bidding, Delhi-based Tulip IT Services was chosen to roll out a wireless Internet network over the hilly terrain of Malappuram (which itself means `atop a hill').

Once the network was established, Akshaya centres would start providing e-payment facilities, besides offering Internet browsing, e-mail, and chat.

Establishing such a network in a district like Malappuram proved to be a tough task.

Entrepreneurs complain that there were connectivity problems in the early days. Each Akshaya centre was to pay Rs 8,000 for connectivity through four post-dated cheques of Rs 2,000 each. Of this, only one cheque has been cashed so far.

The centres were also to pay a monthly charge of Rs 1,000 for unlimited connectivity. This amount has also not been levied as yet, despite the network being up and running.

But the delay that occurred during the rollout affected the centres severely, says Sivasankar. "The centres could not graduate to the second phase," he says. Apparently, Tulip had underestimated the nature of Malappuram's terrain and hence the delay.

But Tulip's Managing Director, Lt. Col. H.S. Bedi VSM, says Akshaya has been "one of the most successful of such projects to date."

"The network has been in use for almost eight months as of now. The very high usage of the project is probably the best measure of its success," he argues.

The centres agree Net connectivity has stabilised now and they are happy about its bandwidth (between 16 Kbps and 64 Kbps), notwithstanding occasional drops.

Out of the 401 centres that are connected, 151 are now providing e-pay services. People can pay electricity and BSNL telephone bills through these centres by paying a fee of Rs 5 per bill.

"In the past two-and-a-half months, 33,000 electricity bills of Rs 1.03 crore have been paid," officials claim.

Here too, entrepreneurs say more streamlining needs to be done at the bank and utility offices to avoid glitches at the back-end.

They would like the Government to provide spurs on these lines: a lower power tariff, waiver of interest on pending loans, status of small-scale industrial units, and channelling of more government services.

What next?

Even though over one-fourth of Akshaya centres have closed down, it may not be appropriate to term the project a failure.

In fact, the very fact that 450 centres are functioning across Malappuram, braving the initial unforeseen hiccups, is a tribute to the project.

But the State Government, now preparing to replicate the project in other districts, should not overlook the problems that these centres encountered.

And offering a helping hand to those in trouble, rather than just washing its hands off, would send a positive message to potential Akshaya entrepreneurs in other parts of the State.

vipin@thehindu.co.in

Picture by G.P. Sampath Kumar