India Proposes Public-Private Cloud Joint Venture

Sudha Nagaraj Bharadwaj, Journalist | 4/18/2014 | 15 comments

Sudha Nagaraj Bharadwaj
India will soon offer reliable, affordable, and efficient cloud services for the private sector through a unique government-private sector joint effort. With an eye on helping the micro, small, and midsized enterprises to harness the cloud to keep pace with modern technology and growing expertise, the government has proposed a cloud services joint venture (JV) to be floated by mid-2014.

While it is too early for exact details of the JV, the proposal is for the government-run National Informatics Centre (NIC) to start a new company with 49% stake, roping in the private sector as a joint partner holding 51% stake. NIC is an organization under the Department of Electronics and Information Technology (DeitY), which develops software solutions and services to spearhead an informatics-led development program for the Indian government.

The idea for the JV was first voiced by the minister for information technology and telecom, Kapil Sibal, at the formal launch of the GI cloud initiative of India, dubbed Meghraj. With institutional links with all the government departments across the country, NIC has been instrumental in deploying e-government applications that have in turn enabled transparency and paved the way for decentralized planning and management.

The GI Cloud initiative helps government departments procure ICT services on demand in the opex model rather than investing upfront on capex, and it could serve as a model for the new proposal. Through the "national cloud" cloud services like infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS), software-as-a-service (SaaS), and storage-as-a-service (STaaS) are being provided to government departments.

Government departments are eager to avail of this service as they can save time and money if they use NIC's infrastructure without having to invest in hardware or software. Judging by the response of its own departments, the government is now looking at providing a similar service to the private sector.

To quote the minister in an interview for the Economic Times, Kapil Sibal:

Economy works on the basis of the private sector. To make the private sector more efficient, we should launch a cloud with private sector. The MSME is not competitive with the rest of the world because each of them cannot have separate manpower, separate infrastructure for computing facility... We can provide the expertise, security, basic services while the private sector can focus on core competence. We can partner with private firms to understand the specific needs of each sector and even come up with tailormade solutions.

This really is a clear breakaway from the earlier mindset of government science, research, and technology bodies working purely for their own departments

While E2India has earlier reported on the Meghraj initiative, it is important to note the opportunities that the final form of the policy has opened up for the private sector:

  • The government is free to engage the services of private cloud service providers to set up dedicated government clouds or empanel providers based on the policy, standards, and guidelines.
  • Private players will also be allowed to host cloud-based apps on the eGov AppStore -- a common platform that will host and run applications in national clouds.
  • Under the PPP model, private sector players have been given the role of system integrators where they can operate and maintain cloud services for specified periods of time.
  • The cloud utilities or cloud service providers may be expected to release a defined rate card that is accessible to government departments. They are also permitted to empanel their service rate cards with government agencies like National Informatics Centre Services Incorporated (NICSI) -- a not-for-profit under the NIC and DGS&D -- a Central Purchase and Quality Assurance organization under the Ministry of Commerce -- as a ready reference for easy procurements in tune with prevailing norms.
  • Existing state datacenters -- a core element of India's e-governance infrastructure -- are to be cloud-enabled through migration to private clouds.

Meanwhile, a separate working group at DeitY is working on a legal framework to enable cloud services in the country. Headed by Infosys co-founder and current executive vice chairman Kris Gopalakrishnan, it is deliberating on issues like jurisdiction, cross-border data flow, data location, security, and so on.

So CIOs, watch this space for further developments. The cloud is increasing its cover over India.

View Comments: Newest First | Oldest First | Threaded View
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Gigi   India Proposes Public-Private Cloud Joint Venture   4/24/2014 5:23:59 AM
Gigi
Re: A public cloud is not the one by Government.
"If the goal is to help startups, then the route should be very different. It would then make sense to subsidize Google cloud and Amazon ec2. Better still government can ensure through policy and regulations that enough local players enter to increase supply, and maintain pro-small penetration pricing."

Nasimson, when government starts offering such services, as a part of competition obliviously private companies may start offering these services at a competitive price or with a better quality
Gigi   India Proposes Public-Private Cloud Joint Venture   4/24/2014 5:21:22 AM
Gigi
Re: A public cloud is not the one by Government.
"you are making an assumption that private companies are not going to offer affordable services. This is not true in most of the cases. The cost of a public service may actually be higher, but since it's public money and the costs are not visible, pricing may well be below costs. see pricing at Google.com/cloud"

Nasimson, it's not an assumption. If they are interested then why so far they didn't came up with such offerings?
MDMConsult   India Proposes Public-Private Cloud Joint Venture   4/23/2014 5:33:08 AM
Re: A public cloud is not the one by Government.
India is known for its IT professionals and talent pool. The market is driven by lower cost. According to IDC, the Indian smartphone market was taken over by Android from Apple by a significant margin of 90% first quarter of 2013. Samsung is a major competitor in the space with its affordable devices.
Susan Fourtané   India Proposes Public-Private Cloud Joint Venture   4/23/2014 3:23:46 AM
Re: A public cloud is not the one by Government.
nasimson, 

"What I am challenging is if this is the most suitable approach?"

Maybe it's not so important if this is the most suitable approach, or not, as it's important that it's an initiative that will help someone. When an initiative is taken I tend to be positive about it, instead of looking on all the possible negative sides such approach could have. 

If there would be a most suitable approach why on Earth, then, no one has taken the initiative? Between something and nothing something is always the best choice.

Something can be improved, whereas nothing doesn't exist at all.

"Indian government has so much to do in education, healthcare, security." 

What do you think the cloud is for? It happens that this public-private cloud JV could very well serve and help education, healthcare, and security. Those are sectors that also need cloud services, it's not just for small companies. 

-Susan
User Ranking: Blogger
nasimson   India Proposes Public-Private Cloud Joint Venture   4/22/2014 11:39:05 PM
Re: A public cloud is not the one by Government.
Susan: This will help startups no doubt. What I am challenging is if this is the most suitable approach? Indian government has so much to do in education, healthcare, security. Public clouds can better be left to private IT sector that is doing a good job anyways.
nasimson   India Proposes Public-Private Cloud Joint Venture   4/22/2014 11:38:19 PM
Re: A public cloud is not the one by Government.
Susan: This will help startups no doubt. What I am challenging is if this is the most suitable approach? Indian government has so much to do in education, healthcare, security. Public clouds can better be left to private IT sector that is doing a good job anyways.
Susan Fourtané   India Proposes Public-Private Cloud Joint Venture   4/22/2014 2:59:49 PM
Re: A public cloud is not the one by Government.
nasimson, 

Why don't you believe that this can help startups? :/ 

-Susan
User Ranking: Blogger
nasimson   India Proposes Public-Private Cloud Joint Venture   4/22/2014 10:02:21 AM
Re: A public cloud is not the one by Government.
@Susan: If the goal is to help startups, then the route should be very different. It would then make sense to subsidize Google cloud and Amazon ec2. Better still government can ensure through policy and regulations that enough local players enter to increase supply, and maintain pro-small penetration pricing.
nasimson   India Proposes Public-Private Cloud Joint Venture   4/22/2014 9:51:02 AM
Re: A public cloud is not the one by Government.
@Gigi: you are making an assumption that private companies are not going to offer affordable services. This is not true in most of the cases. The cost of a public service may actually be higher, but since it's public money and the costs are not visible, pricing may well be below costs. see pricing at Google.com/cloud
Gigi   India Proposes Public-Private Cloud Joint Venture   4/22/2014 5:15:16 AM
Gigi
Re: A public cloud is not the one by Government.
"Government must limit its interventions to spheres where it actually does add value like regulatory frameworks etc. Investing in public clouds should be well-left to the the strong private players like TATA, BIRLA, InfoSys, Wiper & many others who can do a much better job than the government."

Nasimson, you are right and they are good in deliverables. But here the effort is to offer the service for SMEs at an affordable price. If the same service is offering by these private players then they won't offer the service at low cost because they are profit oriented business companies.
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