Framework for Regulating Encryption in India

Published: April 2019

As India forays into a digital revolution that – even in its formative years – has triggered massive transformative changes across the country in areas such as communications, financial inclusion, e-commerce and e-governance, the need for protecting our citizens’ right to privacy and freedom of expression is more pertinent than ever before. Encryption, as a crucial enabler of these rights and liberties, has therefore gained much recognition across public and private domains as the foremost tool for information security. At the same time, the rapid advancement in the use of technology for malicious purposes (such as acts of terror, incitement of crimes, fake news, and sharing of indecent content) has blurred the lines between consumer privacy and national security, and has brought the question of regulating encryption to the forefront of our fast evolving cyber policy.

In this study, we have attempted to envision a framework for the regulation of encryption technologies in India – one that acknowledges the importance of consumer privacy and technological innovation, while not diminishing the role of the government in protecting national security. Through a critical evaluation of the encryption ecosystem, we have presented a rationale for state intervention for the purpose of correcting detrimental market failures. Thereafter, we have undertaken an in-depth analysis of regulatory frameworks across the globe, so as to study best practices in encryption regulation adopted by various countries, and to evaluate their application in the Indian context.

Keeping in mind the unique ‘double-edged’ nature of encryption, we have sought to balance the interests of public as well as private stakeholders. Through an analysis of the non-negotiables that must be borne in mind by any policy that hopes to oversee encryption, we have arrived at a set of recommendations that are bucketed into two categories – (1) the use of encryption for improving data protection, especially sensitive information; and (2) interception of encrypted information for law enforcement.

To strengthen data protection, we recommend bolstering pecuniary damages in case of data breaches and building a publicly available repository of such breaches. We also suggest instituting preventive measures by establishing a voluntary third-party accreditation system of data protection certification/seals.

With respect to interception, and to alleviate the challenges that encryption creates for law enforcement, we recommend that service providers and the government work together to develop mechanisms and modify technology, as required, to allow for lawful interception requests to be serviced. We also recommend improving checks and balances in the use of hacking by law enforcement agencies as well as extending legislative support to ‘ethical’ hacking.

These recommendations would not only assist our policymakers in protecting the rights and freedoms of Indian citizens’, but would also help them build trust among the various encryption intermediaries in order to achieve better public-private cooperation for the country’s national security efforts.

Access the full report here

Advancing gender equality in a post COVID context

Published: August 2020

The COVID-19 pandemic has affected all Indians, particularly vulnerable groups, including women and girls. If evidence from previous disasters and health crises is any indication, women will be disproportionately affected during this pandemic. Within homes, women and girls who already do more than six times unpaid work than men, now shoulder added responsibilities of feeding and caring for children who are not going to schools as well as care work for the elderly, sick or disabled family members.

Outside their homes, shrinking employment opportunities and the resultant loss in bargaining power has compounded the problems faced by women. The decline in decent work opportunities and loss of income can, among other things, lead to a loss of independence, agency, and undo several years of progress achieved through gender-responsive policies. Such losses may also make it more difficult for women to escape situations of domestic violence.

The dangers faced by frontline workers, a majority of whom are women, is another source of worry created by the pandemic. These problems are expected to put additional pressure on the existing ailing economy. Even before the pandemic began, the Indian economy had been beset by falling investment and low growth. Rural India, in particular, had been suffering from agrarian distress which had affected livelihoods significantly.

The disproportionate impact on women and girls calls for more gender-responsive interventions and relief measures. It is becoming increasingly important to expand opportunities for wage employment and enhance food security and nutrition. Evidence shows a clear correlation between food and nutrition insecurity and gender inequalities, with mothers and daughters usually eating last as well as the least nutritious food in Indian households. Therefore, expanding social security benefits, improving access to and availability of employment and decent work opportunities, particularly for women, can help address nutritional and food security challenges during the pandemic.

This analysis, undertaken in collaboration with IWWAGE – Initiative for What Works to Advance Women and Girls in the Economy – explores possible government interventions to advance gender equitable outcomes in the post COVID context.

Read the analysis here

Addressing the barriers to adoption in digital payments

Published: August 2017

This report is an attempt to identify challenges and provide solutions to the issue of digital payments adoption in the Indian context. The Indian economy is a predominantly cash driven economy. While the penetration of digital payments has increased significantly in the last decade, cash still continues to dominate.

The report is divided into two parts. The first part identifies the different factors that act as barriers to adoption, and the second highlights levers that can help overcome these barriers. The following emerge as the most important findings (and lessons) from the research:

  1. Like any new technology, users are hesitant to adopt digital payments. The problem is compounded by a lack of awareness and the fear of losing money. The need of the hour is a strong grievance redressal mechanism to improve trust in the system and well-designed nudges to get users to experiment.
  2. A supportive regulatory regime that enables innovation is crucial to increased adoption. Several steps are already being taken in this direction, but more needs to be done. This includes an accommodating framework with respect to digital payments solutions by non-bank entities, simplification of KYC norms as well as interoperability among wallets.
  3. Upfront investment and ‘visible’ costs like MDR (as opposed to the ‘hidden cost’ of cash) tilt the scale in favour of cash. Given the positive externalities of digital payments, this bias needs to be corrected through more government support.
  4. Offers which bundle value added services that can help merchants grow their business, as opposed to vanilla payments solutions, are likely to significantly increase the uptake of digital payments. The add-on perks could include greater access to working capital loans, inventory management and supplier mapping etc.

Throughout the report, the primary focal points of this research continue to be two sets of stakeholders – small merchants and (bottom of the pyramid) customers. The report draws heavily on empirical research as well as case studies from around the world to gain insights into the behaviour and experiences of these sets of stakeholders.
Access the report here

Women’s Economic Empowerment in India – A Policy Landscape Study

Despite making significant contributions to global economies through various activities, women remain among the world’s most economically disadvantaged groups. They are often disproportionately discriminated against in the labour market, contending with low skilled and informal jobs. They remain outside the ambit of financial inclusion, resulting in poor access to formal banking systems and credit. They are also curtailed by social and cultural barriers that force them to bear the brunt of unpaid work, preventing them from investing in their own wellbeing, and inhibiting their pursuit of economic opportunities.

Research suggests that investing in women’s economic empowerment (WEE) has important linkages with gender equality, poverty eradication, and inclusive growth. Evidence shows that increasing the share of household income controlled by women, either through their own earnings or cash transfers, translates into greater investment in children’s education, health, and nutrition. Additionally, women who have access to property and credit are able to ease hardships for their families during financial shocks. Lastly, women’s economic empowerment can have an overall positive impact on the country’s GDP growth and economic activity.

McKinsey’s 2015 ‘Power of Parity’ report suggests that raising India’s female labour force participation by 10 percentage points would bring 68 million women into the economy and increase the country’s GDP by $0.5 trillion by 2025. Other studies such as those by the International Monetary Fund also estimate a high increase in India’s annual GDP from assured economic participation of women. Yet, recent reports suggest that the female labour force participation rates in India have actually declined; there has been a sharp dip from 31.2% in 2011-12 to 23.3% in 2017-18, which can have severe repercussions for women’s economic empowerment in India.

Given the impact WEE can have on women’s lives and on the broader economy as well as societal welfare, it is important that this issue be given due consideration. While there have been several targeted attempts to improve the status of women in the economy by increasing their participation in the labour force, considering the many hurdles women face, it is important that such attempts be coupled with interventions to shift social norms and build a more supportive ecosystem to encourage women empowerment.

While there is broad agreement that societal structure and community norms strongly impact laws and policies in a country, the contrary is also true. For instance, studies have found that violence against women initially increased when women reservation in panchayats was introduced, however, after two to three cycles of elections, the violence not only stopped, but women’s participation in politics considerably increased. Another study found that reservation for women in panchayats, including for the position of the village head or Sarpanch, dramatically changed public attitudes towards women and the electorate’s perceptions of the effectiveness of women leaders. Exposure to women leaders also changed the aspirations of parents for their girls and the aspirations teenage girls had for themselves.

Such examples highlight the strong potential that policymaking holds for furthering the cause of WEE. Policies that further women’s agency, employment and encourage them to have decision-making powers over household finances and other factors of production can emancipate women from the restrictions of social norms, traditional beliefs and societal pressures. Additionally, a gender transformative policy environment can enable greater government transparency and accountability towards women. However, to use the policy lever effectively, we need to undertake a systematic analysis of the different policies that are in place, and the policymaking environment, so as to identify shortfalls, consider available evidence and make suitable recommendations.

It is important to acknowledge that this is not the first time that such a measure has been suggested or even initiated. While some efforts have been made in the past, evidence still remains fragmented. As a first step towards synthesizing and leveraging such evidence, there is a need to map the current policy landscape on WEE, including the government’s policy priorities and decision-making processes.

It is in the above context that this particular study has been undertaken. The primary objective of this landscape study is to map relevant schemes and policies at the state and central government levels that are closely aligned with the objective of promoting women’s economic empowerment in India. The study employs a critical gender lens to identify promising exemplars of transformative policies in terms of design features, implementation and estimated impact, based on a review of evaluations. In addition to this, it also highlights the gaps in the broader policy landscape of India, with respect to women, as well as in evidence.

Links to the study outputs


Overall Summary

Property & Assets

Social Protection

Unpaid Work

Collective Action

Financial Inclusion

Skill Development

Quality Work

Women Entrepreneurs in Sanitation

Published: March 2020

This study aims to leverage insights gleaned from ground level case studies of entrepreneurship so as to advocate for more systematic government support for women entrepreneurs, in general and more specifically, in the context of sanitation – an area of key concern for the National Faecal Sludge and Septage Management (NFSSM) Alliance.

In low to medium income economies like India, it appears that the motivation for entrepreneurship among women is largely driven by the necessity to earn a livelihood as opposed to innovation, efficiency, opportunity or passion. The dynamics of women’s entrepreneurship in India are affected by a series of factors ranging from discrimination in educational opportunities, family constraints, lack of self-esteem and lower political representation. Additionally, factors like bureaucratic red tape, unfavourable market behaviour, and lengthy legal procedures that commonly plague entrepreneurs in general, are doubly harder for women entrepreneurs to navigate than their male peers.

It is therefore imperative to provide enterprising women business owners/potential owners with the strategies for addressing gaps and leveraging opportunities. To do this, insights must be drawn from the experiences of existing business enterprises on how best to create an enabling environment for women entrepreneurs. Accordingly, this study deep-dives into the business models of four different ventures – (1) Gramalaya that runs community toilets in Tiruchirappalli; (2) JanaJal, a social sector initiative seeking to improve access to clean drinking water; (3) SWaCH, a cooperative organisation that provides for the door to door collection of waste in the municipalities of Pune and Pimpri-Chinchwad; and (4) Café Kudumbashree, a micro-enterprise based in the hospitality sector serving traditional Kerala cuisine and run by Kerala’s Kudumbashree Mission. Each of these ventures have been selected for a variety of reasons, such as adopting an interesting approach, or being an enabling platform for encouraging female agency through collective action, thereby offering unique learnings for encouraging women’s entrepreneurship.

The aim of this study is to inform the priorities of the government for addressing policy gaps to improve and encourage women entrepreneurship, with a focus on the sanitation ecosystem.

Access the report here

India’s focus on its youth – Analysis of the Union Budget

Published: August 2020

“Despite being home to one of the youngest populations in the world, India spends less than 4% of its annual budget on youth-focused schemes”

Restless Development, a global agency for youth-led development and The Quantum Hub joined hands to undertake a study to closely examine India’s budgetary allocations to understand how they address the challenge of preparing our youth for the future.

The study systematically analyses the Union Budget of India over the last five years from a “youth development” lens. By undertaking a broader, all-encompassing exercise that is similar to gender budgeting, the analysis throws light on the government’s priorities for young people while also showcasing trends in allocations to different youth schemes across the years.

The analysis is especially relevant at this time when the economy has been ravaged by the pandemic and opportunities for youth, in terms of education, skilling and capacity building, as well as employment have been severely constricted. Given that India has the largest youth population in the world, it remains an urgent need, more than ever before, to focus on the development of young people.

The analysis shows that the proportion of funding allocated to youth-focused schemes has declined in recent years; in fact, it is at its lowest in the 2020-21 budget. More than a third of India’s population will be in the age group of 10-34 by the year 2021, but the 2020-21 Union Budget outlay for this group is only 3.9%, indicating a lack of adequate focus to development of youth in India.

Of the total budget allocated to youth-focused initiatives, the largest proportion is earmarked for education, followed by skilling and employment. Within education, 75% of the funding to higher education goes to highly selective autonomous institutes, such as, IITs and IISc. At the same time, funding for state higher education institutions has reduced by 78%. The overall skilling budget has halved from 2.8% in 2016 to 1.4% in 2020. In terms of scale, the largest skilling scheme Pradhan Mantri Kaushal Vikas Yojana is looking to provide soft skills training to a mere 10 million young people, out of over 450 million young people.

Moreover, despite the fact that mental health concerns continue to affect young adults in India, a concern that has gained greater prominence during the pandemic, there is no large-scale focused program to address this problem.

The study notes that “India is one of the youngest countries in the world and if we wish to leverage the power of this young population, there needs to be a strong and concerted effort towards youth development. Even though there are a wide variety of schemes and initiatives in the government’s policy arsenal, a strong focus on the youth still seems to be lacking. The allocations specifically meant for youth are concentrated in areas of education and employment, with not enough focus on other critical areas such as mental health or civic participation and leadership that are required for a well-rounded, meaningful and healthy life.”

Access the detailed analysis here
Read the analysis summary
Presentation on the analysis

Menstrual Waste Disposal: Where does India stand and how do we address the challenge?

Published: March 2020

It has been estimated that around 1 billion used sanitary napkins are discarded per month in India. Various studies have suggested that a single disposable sanitary napkin contains plastic which takes up to 500 to 800 years to naturally decompose, making sanitary napkins a serious environmental hazard. In addition, these products contain blood and bodily fluids, which if not sanitized to destroy pathogens, can spread dangerous infections to those coming in contact with such waste. All these aspects make the proper disposal and treatment of menstrual waste an extremely vital aspect of the menstrual health management (MHM) value chain, one that India can no longer ignore. Acknowledging the need to address these issues, various central government bodies, state governments and municipal corporations have issued rules regarding the handling of menstrual waste over the past few years. However, their implementation remains patchy and most menstrual waste still finds itself accumulating in landfills.

More recently, there has been a thrust by governments towards installation of incinerators in places with high footfall such as schools, workplaces, malls etc. However, the emission and safety standards of these incinerators are yet to be issued. Certain municipalities have also experimented with incineration at centralised bio-medical facilities. Although environmentally friendly and cost-efficient in comparison with decentralised incineration, such centralised facilities require menstrual waste to be segregated at source, which remains a challenge.

Given this context, TQH undertook a detailed study for the NFSSM Alliance to understand how this problem might be addressed. We spoke with a wide array of stakeholders in the menstrual hygiene and waste disposal ecosystem, including municipal officials, sanitary workers, civil society organisations, incinerator manufacturers and incinerator users to bring together their experiences and insights. This is one of the first comprehensive studies on the state of menstrual waste disposal in India. The study looks at the menstrual waste value chain in detail and presents possible solutions to this ballooning problem. A crisp brief for policymakers is also available below.

For any queries on the subject, please feel free to write to [email protected]

Access the detailed report here
Read the brief for policymakers

Saving the economy from COVID-19

Will India’s 20 lakh crore relief package deliver?

On May 12, 2020, Prime Minister Narendra Modi addressed the nation through a televised address whereby he outlined the plan for India’s continuing response to the Covid-19 pandemic. He urged self-reliance and promotion of Indian enterprises. He also announced a special economic package, and said that the recent announcements by the government as well as the measures by the RBI, combined with the May 12 financial package amount to Rs. 20 lakh crore — nearly 10% of India’s GDP. The details of this special economic package were announced by the Finance Minister, Nirmala Sitharaman, through daily press briefings. The document attached here analyses the measures announced by the Finance Minister.

A careful perusal of the measures indicates a far lower fiscal outgo than what would have been expected for a stimulus equaling Rs. 20 lakh crore. Many announcements are a reiteration of earlier expenditure measures, and some others focus on monetary policy interventions to increase money supply. Several measures aim at long-term impact, without having any direct implications for the short-term COVID-19 recovery process. Fitch solutions, a macro intelligence firm estimates the fiscal impact of the additional stimulus to be only about 1% of GDP as opposed to the suggested 10%. Many analysts have thus called out the government’s tepid response to the crisis, especially given the economic contraction that India is staring at, with GDP slump projected to be as high as 45% for the quarter and 5% for the entire financial year.

In many ways, India’s response seems to pale in comparison with those of other countries, even against ones that did not impose as widespread a lockdown as India did. Countries like the USA and UK have been focusing on saving jobs and keeping demand from collapsing. The US is giving a one-time $1,200 cheque to every adult earning up to $75,000, plus $500 for every child they have. This is estimated to benefit around 90% of the households in the country. Similarly, the UK Government has committed to paying 80% of salary for staff who are kept on by their employer, covering wages of up to £2,500 a month.

While a like to like comparison is of course not possible, and the lack of formalisation in the Indian economy certainly makes it difficult for the government to implement a stimulus package as effectively as it is done in the developed world, the idea of the above comparison is to highlight the wide difference in the quantum of support. In the note linked here, we enumerate the different measures announced by the Finance Minister and analyse the likely impact of each measure on India’s immediate economic recovery, while highlighting potential challenges in implementation.

Access the detailed analysis here