1. December 18, 2006 Presentation to His Excellency The Governor of Nagaland CSC Concept and Business Model Establishment of Common Services Centers in Nagaland

2. Presentation Outline CSC Concept Stakeholders &Implementation Framework Business Plan Decisions from the State Government

3. CSC Conce CONCEPT

4. Common Services Centers NeGP envisions “web-enabled Anytime, Anywhere access” to information and services in rural India, through three infrastructure pillars -State Wide Area Network -National Data Bank/ State Data Centres -Common Service Centres (CSC)  CSC is the front-end delivery points for Government, private and social sector services to rural citizens of India

5. CSC is more than just service delivery points -Positioned as a Change Agent -Promote rural entrepreneurship -Build rural capacities and livelihoods -Enable community participation CSC requires interaction and coordination between no. of stakeholders -PPP model proposed to ensure effective implementation Common Services Centers

6. CSC Scheme provides a framework to enable setting up of 100,000+ ICT enabled access points across rural India -Targeting all the 638,000+ villages -1 CSC for a catchment of 6000 - 7000 citizens -Managed by trained manpower -Equipped with state of the art technology -Supported by Government -Supported by Government of India/ State Govt Common Services Centers

7. Existing Kiosks -- ITC e-Choupal : 5300 Kiosks -- n-Logue : 1700 Kiosks -- Drishtee : 700 Kiosks -- AISCET : 4000 Kiosks -- DA-TaraHaat : 40 Kiosks. -- Datamation : 35 Kiosks. -- Others : 500 Kiosks Limitations: -Lack of sufficient variety of services -Lack of economies of scale to capture & cater to mass population -No aggregation of content & services -Lack of awareness of potential of rural markets among other private investors -Top down delivery of services, hence not catering to citizen specific requirements Example: Drishtee started of with 52 services. Only 8 survived Non-integration of private and government initiatives

8. The CSC Scheme: Elevating Rural India Three essential resources necessary for rural development viz., Information, Infrastructure and Services Access to information, with relevant infrastructure, end-to-end services allow rural population to enhance their quality of life By enabling access to a large number of e-gov services like, education, health, credit, etc. CSCs offer a solid foundation for economic prosperity of rural India Low Income Lack of Info/ Knowledge/ Goods/ Services Lack of Income Generating Opportunities Lack of SkillsPoverty

9. The Service Model The power of the CSC would lie in its focus on content customization and multi-lingual delivery of End-to-End Services E-Government Services Market Linkages Education, Healthcare, Agricultural Extension, etc Entertainment Data Collection, Rural BPOs, etc. Save Costs Quality of Life Social Development Create Income Opportunities Value-adds Save Costs Create Income Opportunities

10. Restructuring the Delivery of Services Radical change in communication by all Government Departments -eg. A simple AIDS Awareness poster could be delivered to 100,000 villages in a matter of seconds by using the CSC network E-enabling of socio-economic services such as Rural Development can improve quality & reduce cost Business process re-engineering through managerial and financial resources

11. Enabling Transformation CSCs would be the platform for fundamental transformation of the ways in which development challenges would be met in rural India E-Government AgricultureSocial Inclusion Tele-medicineEducation Entertainment

12. CSC Over 400,000 new employment opportunities in rural India Timely delivery of critical Information & Services Structured system to manage issues of health, education, etc. Cost-effective access to Government Services Higher administrative efficiency & reduced red tape Closer links between Government & Citizens The CSC Impact

13. Some MoU Negotiations ITC BANKS

14. Stakeholder and Implementation Framework

15. The Stakeholders DIT FRAMEWORK Central Ministries and Departments State Government Agencies SCAs VLEs Rural Citizen State Governments SDAs DIT NLSA IT Services & Content Providers Private Service Providers

16. Implementation Framework : A Snapshot SPV DIT NLSA STATE GOVERNMENT SDA SCA VLE

17. Business Plan

18. Business Model is a synthesis of various interactions with potential stakeholders, especially SCAs Financial stake of every stakeholder is recommended to maintain financial integrity and long term sustainability Revenue Share between VLE, SCA and SPV StakeholderFinancial StakeBenefit VLEMargin money as a deposit with SCAIncome from Services Revenue Sharing Cost of Training SCACapex & Working CapitalRevenue share with VLE Equity Participation in SPVRoyalty from network SPVResource MobilizationRevenue share with VLE Backend Monitoring Business Support Identify other Strategic Investors GovernmentRevenue SupportSocio-Economic Change

19. Decisions from the State

20. 11 Districts 16 ADC HQs 22 SDO HQs 52 EAC Circles 52 Blocks 1317 Villages 220 Potential CSCs Nagaland - A Snapshot

21. Perceived Instability Fear of Insurgency Geography Population Lack of industrial base Churches as welfare fountainhead Big BPO opportunity Big Agri Procurement Base potential Nagaland – Special Issues

22. CONSIDERING THE UNIQUENESS OF THE STATE, THE PROPOSAL IS TO ROUTE THE PROJECT TO THE CHURCHES COLLEGIUM WHERE PEOPLE FROM ALL WALKS OF LIFE WILL BE A STAKEHOLDER Nagaland – Making it Happen

23. Issue RFP for State Wide Area Network Finalise RFP for the Common Services Centres Open Discussions with the Churches Alliance Identify list of services that are citizen friendly and need-driven Start work on Departmental Digitization Nagaland – Making It Happen

24. Connectivity CSCs to have Broadband internet enabled connectivity CSCs to ride on SWAN connectivity State can propose alternative to SWAN for CSC -Needs to formalize the same before launching CSC -SWAN to provide connectivity up to Block level -From Block to the CSCs would be wireless State to decide whether SWAN connectivity to be provided without charges for 4 years for delivery of e- government services

25. SWAN STATUS

26. Concept of Government Support No Capital Subsidy envisaged under CSC Scheme Framework for ‘optimum level’ of Govt support -SCA/VLE is neither discouraged nor ‘over-incentivized’ Support provided as “Guaranteed Provision of Revenue from Governmental Services” Quantum of support to be determined through bid process Support to be shared equally between GOI and State (ACA) -ACA provided by Planning Commission for NeGP

27. Revenue Support Support to be provided after all CSCs are rolled out Revenue earned from e-gov services to be offset -Savings can be used for back-end computerisation Notional allocation of support -33% of normative value (CSC/month) on 1:6 criterion If total bid amount is lower than total notional allocation, State may increase no. of CSCs without exceeding the allocation At SCA level support not to exceed 50% of the normative value

28. Concept of Government Support No Capital Subsidy envisaged under CSC Scheme Framework for ‘optimum level’ of Govt support -SCA/VLE is neither discouraged nor ‘over-incentivized’ Support provided as “Guaranteed Provision of Revenue from Governmental Services” Quantum of support to be determined through bid process Support to be shared equally between GOI and State (ACA) -ACA provided by Planning Commission for NeGP

29. Revenue Support … If bid exceeds this value, State may adopt any of the following courses of action -Negotiate with bidder to bring down the bid to within 50% -Meet the additional cost from the States own resources (ACA will not be available) -Reduce no. of CSCs to bring down the bid within 50% States accordingly to formulate appropriate bid packages -Regions with lower revenue potential may be clubbed with regions having a higher revenue potential

30. Revenue Support… In special cases States may award bids exceeding 50% with prior approval of GoI -Increase is due to special conditions prevailing in the area/ SCA unit -Bid amount although above 50%, it is still within 50% of the actual operating cost of CSCs If State invites bids for more CSCs, revenue support would be restricted to 33% of the normative value State needs to obtain financial sanction from DIT, prior to issue of award to SCA -Sanction for a State to be based on the finalized amount of the total bids, subject to the norms

31. Pricing for e-gov services (Indicative) Type of transaction (per page or per transaction as the case may be) Charge to citizen SCA/VLE’s Share State’s Share Utility Provider to pay E-GovernmentRs. 10 Rs. 0 Utility CollectionRs. 0Rs. 4Rs. 0Rs. 4 Land RecordRs. 25Rs. 15Rs. 10Rs. 0

32. Extent of Revenue Offsetting The revenue support is proposed to be set off against: -revenue generated from e-gov transaction charges The actual extent of set off need to be decided by the State Government based on: -level of incentive to be provided to the SCA to deliver e- government services

33. Revenue Sharing and Offsetting Mechanism Revenue sharing and offsetting mechanism is illustrated below: -Revenue support sought by SCA and accepted by the State = Rs.3000/month/CSC -SCA’s Share from revenue generated from e-governance services and land record service at a particular CSC in a month = Rs.1000 -Offsetting = 70% (say) of Rs 1000 = Rs.700 -Revenue support the SCA is eligible for = Rs.3000 – Rs.700 = Rs.2300 payment to SCA will be on quarterly basis (revenue support) upon completion of setting up of all the CSCs by the SCA.

34. Expenditure Assessment per district CAPEX OPEX Revenue Assessment per district GovernmentServicesNon-GovernmentServices Revenue Support Required per year over 4 years Charge per Government Transaction Balance 50% Government Share per Transaction 50% Offset 50% VLE Share SCA Share SCA to determine For 0 support and/or after 4 years State will determine sharing in transaction cost Illustrative Example

35. SCA Selection Process States to prepare RFP for selection of SCAs NLSA to provide support to States in managing the bid process States to provide all required support to NLSA in collecting information about : -Existing physical infrastructure & telecom network, IT policy, Ongoing process of government service delivery, E-readiness of States etc. RFP template has been developed in four parts & will be provided to the States

36. Tentative EOI-Pre Qualification Criteria Bidder should have been in existence for at least 3 yrs Bidder, if a company, should have a minimum average net worth of Rs.5 Crs over last 3 financial yrs Bidder, if a society/trust/NGO, should have a minimum average fund flow of Rs.1.5 Crs over last 3 financial yrs In case of a consortium the cumulative minimum average net worth/ fund flow of the bidders would be considered, however, the prime bidder should satisfy at least 50% of the financial criteria If a bidder has established more than 100 ICT enabled kiosks, the above criteria is applicable to only to the extent of 50%

37. Issuance of RFP RFP for CSC Scheme to be issued after RFP for SWAN State to issue advertisements in all major newspapers in the State and one National Newspaper RFP to be hosted on the State’s website for downloading RFP to mention that the SCA to be an entity (company, society, trust, etc.) with capabilities for undertaking such projects State may prescribe pre-qualification criterion keeping in view local requirements

38. Technical Bid Evaluation/ Financial Bid Opening Technical Bid Evaluation -State to set up Evaluation Committee for bids submitted -Committee to include nominees from NLSA & DIT, GOI Financial Bid Opening -Financial bids to be opened only for those bidders meeting the minimum prescribed technical score Service Level Agreements (SLA) -Upon selection of bidder, State to finalize SLA with SCA -Draft SLA to be a part of the RFP

39. Timelines

40. Support from State Departments High Powered Committee Evaluation Committee Backend Computerization Capacity building Process re-engineering Setting up a platform for delivery Pricing of government services Sharing of revenue Outsourcing of works to CSCs (Rural BPOs)

41. Support from State Government Departments Designate one Officer from each Department -Setup a mechanism for regular monitoring -Integrate the existing schemes on computerisation etc. with the objective of delivery of service to the Citizens Media Campaign for Awareness -Deciding on brand name for the CSC -Deciding on the logo for the CSC -Making a documentary film -Making posters -Youth awareness campaign

42. Timelines Project Development Put operational variables in place Set up physical, digital and technology infrastructure Phase 1Phase IIPhase III Ongoing support Quarter EndingMAR’06JUN’06SEPT’06DEC’06MAR’07DEC’07 PHASE I PHASE II PHASE III

43. THANK YOU!

44. Roles… : DIT, GOI Provide Policy & Regulatory support Coalesce Central & State support for the CSC Scheme Undertake necessary approvals at the Central and State level for smooth implementation of the CSC Scheme Provide necessary support for delivering e-Government Services Facilitate infrastructure support through SWANs

45. Roles… : State Government Set up a High Level Committee for overseeing implementation of the CSC Scheme including selection of SCAs Driver for policy, regulatory and other relevant changes Providing Financial Support Service provider for e-Government services Infrastructure and other support to SDA/SCA Decide on Integration of CSCs with existing physical/digital infrastructure: -Government Agencies/ Departments / Schools, GPs/PHC and Post Offices (in consultation with GOI). Decide on Integration with schemes in Education, Health, etc

46. Roles…: State Designated Agency (SDA) Must be an agency controlled by State Govt: -Facilitate e-readiness of the State -Provide policy, regulatory and other support at State level -Facilitate integration of the existing ICT enabled and other Government Schemes into the CSC Scheme. -Help identify CSC locations -Coordinate and facilitate interactions with various State Government Departments -Select SCA under the guidance of the High Level Committee -Facilitate training, capacity building awareness campaigns -Facilitate the SWAN interface

47. Roles…: NLSA Provide program management support to DIT for rolling out CSC Scheme Program Management: Provide right strategy, framework and guidance to all stakeholders for effectively managing the Scheme across the country Monitoring of the Program: To enable DIT to review its progress and to take appropriate timely corrective measures Assistance to States/SDA: In development of RFP, managing the bid process, finalizing the Service Level Agreement

48. Roles…: Service Centre Agency (SCA) SCA is Prime Driver of CSC implementation in a PPP mode Success or failure of Scheme depends on quality of the SCA SCAs are expected to come from diverse segments: -Corporates, PSUs, SMEs, Training Institutes, NGOs, SHGs, Co- operatives etc. SCA would be supported by NLSA and SDA SCA to identify applications and services, harness SWAN SCA to identify, select and train VLEs, establish the CSC, supply, aggregate and update content Selection of SCAs should be undertaken with care & appropriate support from NLSA & DIT as required

49. Village Level Entrepreneur (VLE) VLEs entrepreneurial ability critical for viability & profitability of CSC Should have some financial strength entrepreneurial ability, social commitment & respect within the community VLE would need to : -Market Services of CSCs -Skill upgradation -Undertake Local level publicity -Coordinate with local players -Draw the local community to enable sustained viability

50. Roles : Special Purpose Vehicle (SPV) SPV is to be set up during the initial implementation phase: -Will be created as part of CSC framework in-perpetuity SPV would: -Lay down operating & financial discipline within CSC system -Provide a framework for collaborative decision making -Catalyze content aggregation on an on-going basis -Build a common “Identity” like a common logo, etc.

51. THANKS