India is leading example of digital infrastructure, IMF says

Digital public infrastructure (DPI) is being recognized as a foundational public good and a new paper from the International Monetary Fund (IMF) argues it should be treated like traditional infrastructure.

The IMF believes that systems like digital IDs, payments rails and data exchange layers should be treated like roads or power grids. The authors cite India as a real-world case, with the world’s most populous country scaffolded by DPI.

India is where Aadhaar, UPI, DigiLocker and ONDC have collectively demonstrated how digital infrastructure – when built as shared, reusable rails – can reshape an entire economy.

Aadhaar cut fraud, slashed KYC costs, expanded mobile adoption and enabled new business models. UPI turned payments into a near‑zero‑cost utility, and the broader stack has shown how interoperable platforms can multiply value beyond their initial purpose.

This is the compounding effect the IMF argues governments routinely miss when they treat digital systems as isolated IT projects rather than long-term infrastructure.

Despite dozens of national ID systems, payment platforms and data exchanges worldwide, the authors argue many remain underused because they are financed episodically, governed in silos and appraised with tools that fail to capture long-term spillovers.

Finance ministries understand the potential — officials from more than 50 countries cite DPI’s ability to cut duplication, improve tax collection, and strengthen oversight — but they also face political pressure for quick wins. That leads to short-term, duplicative projects. Coordination is difficult as finance ministries must respect other ministries’ autonomy.

DPI requires sustained investment and appraisal is flawed because traditional cost-benefit analysis cannot capture the cross-sector value that emerges only over time, the IMF paper argues.

India’s example looms large. It shows what becomes possible when digital infrastructure is built deliberately, governed centrally and designed for reuse. And it also sets the stage for the next leap, in a talk on AI agents that can operate on top of these rails.

At the India Today AI Summit 2026, MIT Media Lab associate professor Ramesh Raskar outlined a vision of personal AI agents for every Indian citizen. These agents could navigate services, transact, coordinate logistics and personalize support.

He used the example of a 70‑year‑old woman in rural Bihar to illustrate the point. An AI agent on her phone could plan her travel, manage dietary needs, coordinate with vendors at the Kumbh Mela, and handle payments, provided those vendors’ own agents could communicate across decentralized platforms like Dooth and ONDC.

Raskar’s argument was that this could simply be the next layer built on top of Aadhaar, UPI, DigiLocker and the rest of India’s DPI.

This is a future the IMF’s infrastructure framing anticipates as AI agents can only be as capable as the systems they can plug into. In countries with fragmented digital services, agents will inherit fragmentation; in countries with shared, interoperable infrastructure, agents will amplify its value.

If AI adoption accelerates, the cost of fragmentation will rise sharply, and crises will expose the weaknesses of poor infrastructure — as seen in the U.S. Paycheck Protection Program, where only a fraction of funds reached intended workers.

The IMF believes finance ministries must shift from funding isolated digital projects to building shared infrastructure; from chasing short-term savings to enabling long-term public value, and from fragmented ownership to coherent institutional stewardship.

The Digital Infrastructure IMF paper by Cambridge University public policy professor Diane Coyle; digital government associate professor at University College London David Eaves; and deputy secretary for digital transformation for Brazil Beatriz Vasconcellos can be read here.

India’s DPI is expanding, growing its international footprint

India’s decade‑long push to build national digital public infrastructure (DPI) has reached new milestones. Fresh data shows progress across identity, financial inclusion and connectivity — the three pillars of the JAM (Jan Dhan–Aadhaar–Mobile) Trinity that underpins the country’s digital transformation.

Aadhaar, the world’s biggest biometric digital identity system, continues to expand its reach. As of March 2026, more than 1.44 billion Aadhaar numbers had been issued, enabling residents to authenticate themselves securely and instantly across a growing range of public and private services.

The platform processed over 27.07 billion authentication transactions in 2024–25 alone, reflecting its deep integration into welfare delivery, banking, telecom and everyday transactions. Officials say Aadhaar has made identity “portable, verifiable and reliable,” reducing friction in accessing essential services.

The Pradhan Mantri Jan Dhan Yojana (PMJDY) launched in 2014 to bring every unbanked adult into the formal financial system. It is one of the world’s largest financial inclusion program. The number of Jan Dhan accounts has surged from 147.2 million in 2015 to 577.1 million by March 2026. Deposits have risen sharply as well — from 156.7 billion Indian Rupees in 2015 to ₹2.94 trillion.

Nearly 400 million RuPay debit cards have been issued to beneficiaries, helping millions participate more fully in the economy. Officials say the scheme has channelled household savings into the formal banking system, strengthening financial resilience and expanding access to credit, insurance and pensions.

Connectivity has emerged as the third critical layer of India’s digital infrastructure, with 85.5 percent of households now owning at least one smartphone. These devices are gateways to banking, education and public services.

Wireless subscribers reached 1.2587 billion by December 2025, while 5G services are now available in 99.9 percent of districts, covering 85 percent of the population. India has installed 518,000 5G base stations nationwide, ensuring that digital services reach both urban and rural regions.

Built on the JAM foundation, India’s DPI stack has grown into a connected framework of open APIs and public digital goods. Known collectively as India Stack, these systems now support identity, payments, data sharing, welfare delivery, health, education, skilling and governance.

Officials emphasize that the stack is not a collection of standalone portals but an interoperable digital backbone designed for population‑scale service delivery. Its modular architecture has drawn interest from countries exploring similar models.

India’s DPI soft power

India’s digital transformation and DPI has received interest from countries worldwide. The country has signed Memoranda of Understanding (MoU) with 24 countries as of February 2026. These are concentrated in the Caribbean, Southeast Asia, Africa and Latin America.

In addition, India’s payment infrastructure has gone international, with UPI live in eight countries. These include France, Sri Lanka, Nepal, Singapore, the UAE and Qatar, among others. This cross-border functionality enables cross-border transactions, easing remittances.

India’s Press Information Bureau drew attention to India’s G20 Presidency in 2023 and how the G20 New Delhi Leaders’ Declaration explicitly recognized DPI as a development accelerator. “India articulated the idea that DPI is not proprietary technology, but digital rails for inclusive growth, particularly for the Global South,” the release says.

The Modular Open-Source Identity Platform (MOSIP) and CoWin, an open-source software underpinning a digital health platform, are highlighted as examples of an Open Digital Public Good. MOSIP is a configurable, open-source framework for governments looking to build sovereign digital identity systems.

Enabling ecommerce, data sharing and digital public services

The Unified Payments Interface (UPI) is reshaping retail payments. In January 2026, UPI processed 21.70 billion transactions worth ₹28.33 trillion. A total of 691 banks are now live on the platform. The IMF’s June 2025 report identified UPI as the world’s largest fast‑payment system by volume, while ACI Worldwide’s 2024 report estimated that UPI accounts for 49 percent of global real‑time payment transactions. Within India, UPI handles 81 percent of all retail digital payments by volume.

The Public Financial Management System (PFMS) has emerged as a key tool for transparent and accountable public spending. Mandated for Direct Benefit Transfer (DBT) payments since 2014, PFMS has helped eliminate duplicate and fake beneficiaries, saving the government more than ₹4.31 trillion between 2015 and March 2024. By January 2026, cumulative DBT transfers had crossed ₹49.09 trillion, signalling a shift toward targeted, digital‑first welfare delivery.

Launched in 2022, the Open Network for Digital Commerce (ONDC) aims to democratize ecommerce by enabling buyers and sellers to transact across interoperable platforms. As of December 2025, more than 116,000 retail sellers across 630-plus cities were active on the network, expanding market access for small businesses.

DigiLocker, the digital document wallet launched in 2015, has grown to 676.3 million users as of March 2026. More than 9.5 billion documents have been issued through the platform, reducing reliance on physical paperwork and curbing document fraud.

Digital governance systems encompass thousands of services

UMANG, the unified mobile governance platform, has become a central access point for public services. With 102.5 million registered users and 7.2336 billion transactions recorded as of March 2026, the platform now hosts more than 2,400 services ranging from EPFO claims to utility bill payments and exam results.

e‑Office has digitized file management across government departments, replacing paper workflows with electronic processing. Built on open architecture for easy adoption at central, state and district levels, it streamlines decision‑making, integrates departmental functions and reduces procedural delays, creating a more transparent and efficient administrative system.

API Setu launched in March 2020, API Setu provides a secure, standardised platform for sharing government data and services through APIs. It manages the full API lifecycle and supports both public and private ecosystems. As of March 2026, it hosts 8,036 APIs, with 6,592 consumers, 2,559 publishers and 10,530 organizations onboard. The platform strengthens interoperability and accelerates innovation across digital governance.

PM GatiShakti was introduced on 13 October 2021 and offers a GIS‑based digital platform for integrated planning and coordinated execution of infrastructure projects. Its Network Planning Group evaluates proposals to ensure multimodal connectivity, last‑mile access and data‑driven decision‑making. As of 10 February 2026, 352 projects worth ₹16.10 trillion have been assessed, with 201 sanctioned and 167 under implementation. The platform is intended to bring coherence and transparency to large‑scale infrastructure development.

More on all the platforms launched as part of India’s DPI as well as the full list of countries with MoUs on India Stack can be found here.

Article Topics

Aadhaar  |  AI agents  |  biometrics  |  data exchange platform  |  digital ID  |  digital public infrastructure  |  India  |  International Monetary Fund (IMF)  |  Unified Payments Interface - UPI