Risk 360

Postulations on Digital Inequalities Risk Mitigation Strategies

In the midst of the fourth industrial revolution, life increasingly revolves around digital technology and innovation. In just two decades, the digital revolution has become ubiquitous and has impacted every aspect of life from communication, education, work to governance and health. Just like every industry is prey to risk, the ICT sector is no new to it. Hence, a well ICT risk management framework will help to reduce the impact of the potential risks. ICT risk management is a process to reduce the threats, vulnerabilities, and consequences that could arise if data is not protected.

Access to Information and Communication Technology (ICT) has become vital in achieving every economic and human development objective. When equal access to technology is a concern, on one hand, to increase the ability to use such ICTs is a challenge on the other, for the authorities.

People who lack access to ICT are into two categories: People who lack the affordability for ICT services and People who consider digitalization insignificant i.e. lack of motivation.

The digital divide is the gap between those who have access to ICTs and those who don’t. This gap could be defined by various factors such as income, locality, education, and gender.  Primarily digital divide is attributed to two factors – income and education. Income decides the level of access to ICTs whereas education determines the efficient utilization of ICT.

Digitalization has the power to accelerate economic growth, lift millions of people from poverty, provide affordable education and health, but the same could also worsen inequalities. Countries failing to cope with digitalization would be left behind in the list of beneficiaries of the fourth industrial revolution and there is always a risk of personal security.

Since digitalization does not happen equally over the world there exists an imbalance which is termed- the digital divide.

This discrimination is a form of poverty and social exclusion which has various adverse effects as listed below:

  • Barrier to knowledge

Access to the internet should be treated as a basic need like water and electricity. The Digital divide impacts the capacity of children to learn and develop. Many children have been deprived of education in lower-middle-income countries due to a lack of sufficient technology and digital skills. Those with the right resources have learnt new skills and had the edge of acquiring knowledge from home. Meanwhile, most of the children have been forced to drop out of school.

  • Barrier to employment

The digital divide is a great impediment in hunting for quality jobs. This reduces the chances of acquiring the right job and thereby affects the income of the individual. Lack of ICT skills, social media experience, and inadequate infrastructure are the major hindrances in getting a job in the modern environment.

  • De-industrialization

Deindustrialization is primarily due to the maturity of the economies and disinvestment. The maturity of economies is a result of digitalization. This affects the elderly and unskilled laborers. When a process is automated, it creates underemployment and unemployment in industries.

Authorities across the world have implemented various regulations, policies, and risk assessment processes to bridge the digital divide.

Few strategies that could bridge the gap are mentioned below: 

  • United Nations has developed the International Telecommunication Union (ITU) which aims at providing 100% access to underserved communities.
  • USAID Digital Strategy 2020-2025 is a strategy adopted by the U.S government to ensure the protection of data privacy and strengthen cybersecurity. With the help of the 13 best practices as laid in the Digital Investment Toolkit, a country can determine whether it is along the digital development spectrum.
  • Global Digital Project by OECD focused on the following aspects:
    • Making digital transformation work for growth and productivity in all businesses.
    • Changes in the nature of work in the digital era and
    • Realizing the potential of new digital technologies.
  • Free Basics is an initiative by Facebook that provides free access to websites.
  • Providing grants, taxation benefits and incentives to ICT providers
  • Improve digital literacy before providing access to ICTs. Educating kids at school will have a multiplier effect in achieving digital literacy.
  • Organizations providing ICTs are often faced with entry barriers. Regulators should reduce the entry barriers and focus on ensuring the quality and reliability of services.

All though digitalization does not ensure equity in learning and accessibility, it has the power to lift barriers. The digital divide is a global issue faced by both developed and developing nations in the world. It is an issue faced by nearly 70% of the world population. The digital divide can be eliminated with a proper risk mitigation framework to overcome poor digital literacy and infrastructure development.

References:

  1. The Lancet – COVID-19 and the digital divide in the UK.
  2. IMF- Bridging the Digital Divide to Scale Up the COVID-19 Recovery.

Blog Published By: Ms. Harini Rao, Management consultant at LAAMS Tax Consultancy Pvt. Ltd.

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