Low-cost digital platforms project its technological dominance on global front

Vietnam aims for the digital technology industry to lead the implementation of Industry 4.0 in the country, with revenue growth 2.5 times higher than the overall GDP expansion rate.

The target was revealed in the Ministry of Information and Communications (MIC)’s directive for information and communication technology (ICT) development in 2023 and the 2024-2025 period.

"Digital technology focused on design, creation, and manufacturing in Vietnam is the main industrial sector driving the nation's industrialization and modernization, contributing to greater digitalization capability and shaping a digital country," the MIC stated.

Under the plan, the ministry expected revenue from the ICT sector would hit US$165 billion in 2023, eventually rising to $185 billion by 2025.

In this sense, digital technology companies would contribute between 6 and 6.5% to overall GDP growth over the next three years, together with ICT industrial exports that would amount to 137,000 million dollars in 2023 and 160,000 million in 2025.

In 2022, revenue from Vietnam’s ICT sector hit $148 billion, representing an increase of 8.7% year on year. The contribution of the industry to GDP was estimated at $34.3 billion, up 8.7%.

Meanwhile, the country’s exports of hardware and electronic products rose by 11.6% in 2022 to $136 billion, resulting in a trade surplus of $26 billion in the sector, a significant improvement from a modest $4 billion in 2021.

According to the MIC, the total number of digital tech firms in 2022 was 70,000, up 9.6% year on year, 60% of which are moving up from engaging in low-value production processes to those of higher value.

By 2025, the MIC expected Vietnam to have 80,000 digital tech firms, meeting at least 50% of digital tech and services from state agencies.

Another priority is to have 10 major IT firms with international competitiveness and revenue of over $1 billion each, along with at least eight provinces/cities with ITC revenue of over $1 billion.

“Vietnam should be among the top five countries in terms of revenue from software, IT services, and mobile games development,” it stated.

For India - another developing country, Prime Minister Narendra Modi aspires to turn his nation into a Vishwaguru, or 'teacher to the world'. In a little over a decade India has built a collection of public-facing digital platforms that have transformed its citizens' lives, according to the Economist.

India's reputation as a country full of software engineers is especially strong among developing countries, the Economist report said.

Infrastructure' (DPI) as the number and ambition of the platforms have grown. It is this DPI that India hopes to export--and in the process build its economy and influence, reports The Economist. It said it is India's low-cost, software-based version of China's infrastructure-led Belt and Road Initiative.

"The benefits of digital transformation should not be confined to a small part of the human race," said PM Modi at the G20 summit in Indonesia last year.

'DPI' involves a triad of identity, payments and data management. It started with the aptly named Aadhaar, or 'foundation', a biometric digital-identity system rolled out under the former Congress-led government in 2010, which now covers nearly all of India's 1.4 billion people.

Next came the Unified Payments Interface (UPI), which makes digital payment as easy as sending a text or scanning a QR code. Launched in 2016, the platform accounted for 73% of all non-cash retail payments in India in the year to March.

Sahamati, an NGO, is setting up a platform to allow "account aggregators" to enable individuals to share financial information in a standardised format with, for instance, lenders. It hopes this will mitigate the need for the forests-worth of documents applying for a loan in India entails.

According to the Economist, the digital ecosystem behind these developments is complex. Its members include government agencies, regulators, tech firms, quasi-public corporations, NGOs and universities, all building different parts of the digital edifice.

Other platforms, such as for health and sanitation management, are created by NGOs and sold to state and local governments. Many have been designed by it experts with private-sector experience.

As per the Economist report, India wants to coax other developing countries to follow its example. It views this as a way to push its claim to lead the developing world.

Partly to that end, India invited 125 such countries to a 'Voice of the Global South Summit' in Delhi in January.

According to the report, India's reputation is much better in the global south than America's or China's. And its digital technology, even if glitchy, is a huge improvement on the largely analogue states operating in most developing countries.

India's digital progress is proof of that. It seems likely that many poor countries will want to emulate it, to their advantage--and India's too, the report said.