MoneyControl | Government overreach in digital economy could end up with no commensurate benefit and serious distortions

History, it seems, tends to move in full circles. “Be Indian, Buy Indian”, a popular slogan from the bygone era has changed to “Vocal for Local”. Deliberate incursions by the government into the market, especially into the digital economy, are reminiscent of old Nehruvian socialist objectives despite all the blame Nehru gets for India’s economic problems. The government’s intervention into payment via the Unified Payments Interface (or UPI) was justified on the grounds that it is a public good (it isn’t) and that lowering transaction costs can benefit everybody (it can). But the justifications grow thinner when we consider other government run or backed enterprises in the digital economy, such as the Government e-Marketplace (GeM) (facilitate government procurement), mSeva app store (indigenous mobile app store), and the Open Network for Digital Commerce (ONDC) among others. Read the full article here.