Elsevier

World Development

Volume 37, Issue 10, October 2009, Pages 1663-1673
World Development

Outsourcing the State? Public–Private Partnerships and Information Technologies in India

https://doi.org/10.1016/j.worlddev.2009.03.005Get rights and content

Summary

This paper examines public–private partnerships (PPPs) for development through the example of telecenters in two Indian states. How might a developmental state position itself with respect to civil society under a PPP model of service delivery? We find that each state’s political economy is reflected in its PPP strategy, but that in both states the emerging middle classes rather than the poor benefit most from ongoing telecenter projects. Outsourcing development services to private entities need not “privatize” the state but does alter the way in which citizens “see” the state. Service delivery through telecenters becomes a symbol of government efficiency and responsiveness.

Introduction

Information and Communication Technologies (ICTs), such as computers and mobile phones, have emerged as the newest tools for the delivery of development services to rural areas. ICT and development (ICTD) projects cover many domains including health care, education, online government services (“e-governance,”) and the provision of commodity price information to small producers (Brewer, Jensen, 2007, Madon, 2005). Substantial funding has been injected into ICTD projects around the globe: in 2006 the World Bank had a portfolio of $3 billion in loans to ICT projects in over 80 countries, while USAID spent $200 million in 2004.1 As did the earlier (albeit different) Green Revolution and Appropriate Technology movements, the ICTD movement presents a technology-centered set of solutions to problems that beset developing countries. A particularly popular example of ICTD is the entrepreneur-run computer kiosk or telecenter that provides e-governance and education services in rural regions that previously lacked access to computers (Bell, 2006, Kumar and Best, 2006).

As part of a wave of good governance reforms in developing countries, ICTD telecenter projects are being implemented predominantly through public–private partnerships (PPPs). The goals of the good governance agenda are increased accountability, professionalism, and reliability in the delivery of public services. The reforms are being carried out through restructuring and (partial) privatization of state bureaucracies, decentralization of state power to local governments and non-state actors (Batterbury & Fernando, 2006), and the introduction of managerial practices to governance (Clarke & Newman, 2008). Supporters of this agenda argue that poverty alleviation and development can be achieved more effectively by “combating corruption, nepotism, bureaucracy, and mismanagement” (Nanda, 2006, p. 270).

Proponents of PPPs likewise argue that they increase efficiency and responsiveness in the delivery of hitherto government-provided services (Lewis, 2000). PPPs have been advocated for healthcare services, water and sanitation, and infrastructure projects (Miraftab, 2004) in developing countries. In principle, the private sector would “provide higher quality goods and services at lower cost, and the government sector of public providers would shrink accordingly” (Linder, 1999, p. 36). At the same time, the public sector can “satisfy social pressures or the local needs of service provision” (Klijn & Teisman, 2000, p. 84). On the other side of these debates, some have criticized good governance agendas for their “neoliberal bias” of market-led development (Jenkins, 2002). Critics of PPPs maintain that these models “cover” for or border on pure privatization and replace the public sector’s ability to serve the public good (Miraftab, 2004).

Despite the growth of PPPs in the developing world and the considerable funding behind ICTD projects, actual partnership practices and the political and social impacts of the PPP-ICTD pairing remain under-investigated. The premise of the critiques of PPPs is that the private sector is the more powerful partner and the state2 acts as little more than the guarantor of private interests. The premise of the supporters of PPPs is that the private sector will deliver services more effectively without excessive government interference. It is true that governments often partner with influential corporations to deliver public services or large-scale economic development projects. But in this paper we ask: what are the roles and responsibilities of each of the partners when the private sector actors are small-scale entrepreneurs? At the project level, who benefits from these partnerships and do they remake or reinforce existing social asymmetries? At a more macro level, does shifting the responsibility for providing development services to private entities alter the way in which citizens “see the state”3 (Corbridge, Wiliams, Srivastava, & Veron, 2005)? And how may the developmental state4 position itself with respect to civil society under a PPP model of service delivery?

We approach these questions through a critical examination of ICTD telecenters in the states of Kerala and Andhra Pradesh (AP), India. Development-oriented telecenters, mainly organized as PPPs, are increasing at a faster rate in India than in any other country (Madon, 2005). We focus on how the PPP-ICTD pairing gives the state a way to renegotiate its image before its citizens, and on the welfare impacts of telecenters on rural households and on entrepreneurs.

Our research is based on a combination of field methods such as interviews, participant observation, and short surveys, as well as secondary literature review and document analysis. Primary data collection took place on several trips to India over a period of 19 months from 2004 to 2006. We chose Kerala (a traditionally interventionist state) and AP (a less-interventionist but nonetheless developmental state) for our analysis because both have been at the forefront of the telecenter movement. Despite historical differences with respect to the relationship between state and civil society, both have implemented their telecenter projects using entrepreneur-centered models. Their ICTD initiatives display a range of emphases on the private versus the public sector and on social versus financial concerns. This makes them excellent cases through which to highlight variations and similarities in PPP structures and to correlate these with the outcomes of ICTD projects.

Our research indicates that PPP-ICTD projects are strongly impacted by the natures of the state and the private sector, and that the development benefits of these projects are mainly captured by the semi-rural emerging middle classes. Entrepreneurs are significant, yet vulnerable, stakeholders in telecenter projects. We find that PPPs must combine the credibility of the state and the service orientation of the private sector in order to provide better experiences for users. We argue that states are turning to the private sector as partners not only for the provision of services, but also to associate themselves with a liberal market order and the modernization process more broadly. In both Kerala and AP, the governments are eager to improve their image with the public and are trying to reshape themselves into market friendly and efficient entities. Everyday encounters with telecenter entrepreneurs have become a new mechanism through which the citizen sees, and so comes to construct, the state. Service delivery through ICTD kiosks is beginning to act as a symbol of responsiveness and as a tool to portray a new, more efficient government to citizens.

There are contradictions in this new representation of the state. We find that citizens simultaneously feel trust and disillusionment toward the government as an entity that they consider credible yet inefficient. The private entrepreneurs, too, distinguish themselves from, and at the same time ally themselves with, the government “brand.” We thus find, in contrast to some critiques of PPPs, that the state is not “privatized” in the process of developing these partnerships, at least when the private partners are small and home-grown entrepreneurs. Rather, a developmental state can outsource a portion of its development agenda and yet retain considerable control over it.

We begin the paper with an overview of how and why ICTD projects developed through PPPs in India; this establishes the context for the specific cases of Kerala and AP. We then review telecenter strategies and projects within these states. This section is followed by a discussion of our research methods. Finally we discuss our findings by looking at: (1) how political economy influences the structure of PPPs; (2) the material benefits of telecenters for customers and entrepreneurs and the influence of PPP structure on these benefits; and (3) how the state negotiates the way it is seen by citizens through its telecenter projects.

Section snippets

ICTD through PPP in India

The arguments for delivering ICTD services through PPPs are wide-ranging. Private sector firms, multilateral organizations, and state officials themselves claim that PPP models are becoming the norm for ICTD projects in response to stretched development budgets, the public sector’s inefficiency as the sole provider of services for the poor, and the loss of state power in a liberalizing global economy (Cerny, 1995, McMichael, 1996). NGOs that once saw themselves as a counter to the for-profit

ICTD through PPP in Kerala and Andhra pradesh

Kerala is well known for its high levels of social development, unparalleled in developing countries9 (Parayil, 1992, Rammohan, 2000). The state has been responsive to populist demands, and the Left Democratic Front led by the Communist Party of India (Marxist) has a strong presence. At the same time the state has been criticized for its poor industrial

Research methods

We conducted 31 interviews with state employees within the GoI, AP and Kerala, using a semi-structured interview protocol. These were key informant interviews; through snowball sampling, we interviewed senior state officials, union leaders, and lower level officials who had been involved with, planned or implemented telecenter projects at each level. The interviews explored the respondents’ views of each state’s telecenter strategy; appropriate roles of state and private sector in development;

Political economy and the structure of PPPs

Our research in Kerala and AP identified three dimensions along which PPPs for ICTD projects can be differentiated. First, there are significant differences in the operational roles of the private and public sectors within these partnerships. Although Kerala and AP both follow an entrepreneur-centered approach to telecenters, Kerala’s Akshaya project builds in a large role for the state in the implementation process. The state works with entrepreneurs to develop their telecenter services,

Conclusion

This paper has examined the coupling of the public–private partnership model with ICTD efforts in light of how it affects entrepreneurs and households and enables a reshaping of the state in India. It addresses two main questions—whether PPPs reduce the ability of the state to serve the public good, and how citizens’ perceptions of the state are affected when PPPs are used to provide public services. The PPP literature is largely based on analyzing the relevance of the government when it

Acknowledgments

The authors would like to thank the project staff, households, and entrepreneurs of the ICT projects in Kerala and AP for assistance with this project. This material is based upon work supported by the National Science Foundation under Grant No. 0326582, the Technology and Infrastructure for Emerging Regions group, and Microsoft Research India. Thanks to Peter Evans, Laura Enriquez, Dan Kammen, Asher Ghertner, George Wittemyer and Jennifer Bussel AnnaLee Saxenian and our anonymous reviewers for

References (51)

  • S. Batterbury et al.

    Rescaling governance and the impacts of political and environmental decentralization: An introduction

    World Development

    (2006)
  • R. Veron

    The “new” Kerala model: Lessons for sustainable development

    World Development

    (2001)
  • T. Bell

    Village computing: A state of the field reflections on the village computing consultation

    (2006)
  • C. Blattman et al.

    Assessing the need and potential of community networking for development in rural india

    The Information Society

    (2003)
  • Brewer, E., Demmer, M., Du, B., Ho, M., Kam, M., Nedecschi, S., et al. (2005). The case for technology in developing...
  • P.G. Cerny

    Globalization and the changing logic of collective action

    International Organization

    (1995)
  • J. Clarke et al.

    What’s in a name? New labour’s citizen-consumers and the remaking of public services

    Cultural Studies

    (2008)
  • J. Comaroff

    Reflections on the colonial state in south africa and elsewhere: Factions, fragments, facts, and fictions

    Social Identities

    (1998)
  • S. Corbridge et al.

    Seeing the state: Governance and governmentality in India

    (2005)
  • J. Dedrick et al.

    Information technology in India: The quest for self-reliance

    Asian Survey

    (1993)
  • H. Desoto

    The mystery of capital: Why capitalism triumphs in the west and fails everywhere else

    (2000)
  • M. Dev et al.

    Macroeconomic scene: Performance and policies

  • DIT. (2006). Union cabinet approves setting up of 100,000 rural common service centers. Press Release Government of...
  • DIT. (2007). Annual report. Ministry of Information Technology, Government of...
  • P. Evans

    Embedded autonomy. States and industrial transformation

    (1995)
  • J. Ferguson et al.

    Spatializing states: Towards an ethnography of neoliberal governmentality

    American Ethnologist

    (2002)
  • F. Frankel

    India’s political economy, 1947–1977. The gradual revolution

    (1978)
  • GOI. (2004). India: E-readiness assessment report 2004. Department of Information Technology, Ministry of...
  • A. Gupta

    Blurred boundaries: The discourse of corruption, the culture of politics, and the imagined state

    American Ethnologist

    (1995)
  • P. Heller

    The labor of development: Workers and the transformation of capitalism in Kerala

    (1999)
  • IIITB. (2005). Egovernance report.Bangalore: IIITB, Kiran,...
  • R. Jenkins

    The emergence of the governance agenda Sovereignty neoliberal bias and the politics of international development

  • Jensen, R. (2007). The digital provide: Information (technology), market performance, and welfare in the south indian...
  • P. Kashyap et al.

    The rural marketing book

    (2007)
  • Kiri, K., & Menon, D. (2006). For profit rural kiosks in india: Achievements and challenges. Information Technologies...
  • Cited by (0)

    View full text