 Hello and welcome to NewsClick. Today we are in conversation with Rabir Purkessa, the president of the free software movement of India, a network that works on issues of internet governance, surveillance and issues of free software. Rabir, what we hear today is about the so-called advent of the fourth industrial revolution, the role of technology in changing production processes, in changing the way we work. Can you give us a big picture on what is happening in the world of business? Of course this question of the fourth industrial revolution really comes out of some formulation in Davos. So it's not that it's a widely accepted thing. But yes, you can periodize it in some way and says the rise of connectedness in fact is what is new into all this and this will have enormous implications for production later on. What we are seeing is effectively if we take 3D printing, if we take the fact that the factory floor is going to look very different from what we did earlier, if we take the fact that most of our devices are going to be connected to the internet increasingly, you are going to get a very interconnected world in which the ability to essentially monitor you from birth to death is going to be there with certain set of companies. The second part of it is that you are going to see that number of people required to produce what we consume are going to be far less. So both sets of things are in process because you have not only what is called popularly the internet of things, you are seeing artificial intelligence. We thought it's quite some distance away for seeing it for instance in cell driven cars but with what we call the autonomous vehicles which are really driverless cars, what we are seeing is that what we thought was at least a decade away is already running in different cities, maybe on a pilot scale but nevertheless running. So we seem to have really accelerated a lot of trends simultaneously what is called the big data revolution along with the internet of things which are as well as let us not forget the 3D printing part of it where knowledge of the people, data of the people and knowledge of how you produce things are going to be far more important than the physical labor required to produce things directly as it used to happen in the factory flow or in terms of the withdraw materials you require because with 3D printing you are going to see less of subtractive technologies where you really machine out material and what you finally are left with are a small part of what you started with and you are going to see additive processes by which you lay on material. So a lot less therefore is supposed to go into wastage if you go into a 3D printing kind of technology. So these are big changes and it is true that these changes are going to restructure the world of production as we know it and the way we have been interacting with the world till date. So yes but that has been the role of technology always. You know if you take a telephone, you take the electricity system all of this changed the way we looked at each other, we looked at production. So I think this is not something which is dissimilar to what has happened in each century in the past but yes the nature of these changes are going to be different in the 21st century than they were in the 20th century. And you hear news about the change in sort of economic power to the south but in terms of the digital sphere who are the big sort of corporate players and if you look at the Fortune 500 now in the recent past many of these tech firms have now become supposedly the big players. You know it's interesting if you take for instance the 19th century at the end of it the oil companies are the big players they continue to be big players even today but they really were monopolies of a different kind in the end of the 19th century beginning of the 20th century. You have the car companies, the Ford, the General Motors various other automobile manufacturing companies that come up. They were the big players in the 20th century. Of course you had others as well but they were really big players. Today an Uber has more market capital than for instance Ford or General Motors. So these are huge structural changes we are seeing in the field of production in the field of commerce. So you are seeing a set of new players emerge almost at a lightning speed as it were. In this today the digital monopolies have become obviously the dominant players. If you take a Fortune 500 list 20 years back, 30 years back on you taken today the significant changes that is too longer the oil companies no longer the Walmart's not even the financial companies who till about 10 years back were very big but today it's really the digital monopolies and you can see the first five Fortune 500 companies today are actually digital monopolies starting with Apple. Now each of them may be different. For instance Apple is on the same as Google and Facebook and then you have Amazon which is also one of the top five which again is different. It's really not the way for instance Microsoft is a big player. So all of them have different set of things with which they have become so powerful but the bottom line of it is that these are really digital monopolies and they today are bigger than the whole number of countries in economic terms because their market capitalization is bigger than probably any one of the bottom 150 countries in the world. So you are seeing a different world emerge in terms of what constitutes the center of economic power today and interestingly none of them are producing anything. So Apple does not produce anything production is done by Foxconn or somebody else it owns intellectual property design and the market branding as it were it holds this by virtue of it it has the largest cash reserve in the world today. But if you look at the narrative in countries like India which are supposedly also in the forefront of the digital revolution you have firms like Flipkart, you have Ola, you have Paytm and you have this enthusiasm that India is sort of harnessing the benefits of the digital revolution and you also see for instance with the recent demonetization drive when it was quite clear that you were unable to unearth black money the sort of government rhetoric quickly shifted to cashless payment. Does India really have the infrastructure? What do you think about the Indian players in this field? The biggest difference between all other countries in China to some extent Russia has been they have been able to insulate their economy digital economy from outside players. China much more successfully than anybody else mainly because of what's called the Chinese firewall. Now the Chinese firewall is thought to outside people most people in fact as if it's a censorship instrument but the real protection that it is provided is not to censoring the people but the fact that insulated their internal economy from Facebook's, Google's and so on and therefore they are the only ones who also produced digital monopolies on a scale that nobody else has been able to do except the Americans. So that is the lesson you can see that has been a protection of the market digital market given by the Chinese firewall which had allowed this to happen. India unfortunately did not. In fact India has a second disadvantage it also uses English quite extensively. So it gets much more easily integrated to the English speaking internet as it were because if you see the diversity of languages in the world diversity of languages in the internet is much smaller. The bulk of the websites today I think about 55% of English websites while if you take the English language speakers they are probably in the range of 15 to 20%. So you can already see that skewing has taken place India gets more easily absorbed apart from the fact that it has been a major outsourcing hub therefore it has also been a partner, albed junior partner to many of the digital monopolies in creating software for them. So this is the role that India has played. Now Ola, Flipkart all of them are there and a lot of them have also seen for instance Chinese investments in them. So they have been also other foreign investment that have come into them. Will they be able to face up to Amazon and Uber open question as of date we don't really know because Ola or a Flipkart has to contend with the deep pockets that for instance Amazon and Uber has. Each of these areas also you must understand the monopoly is built first and this companies bleed cash in the period that they're building monopoly. Once they've built the monopoly that's when they make profits. Amazon did this for about 10 years before it started showing any profits. So do they have the deep pockets enough to sustain that? That's a big question that we need to answer and there's no easy answers at this point in this question. Coming back to the digital infrastructure and I think that's really an independent question to what's happening here because as of now only 3% of transactions are in digital form. So that's the economy we're talking about it's still a small part of the overall Indian economy. So Ola or an Uber or a Flipkart or an Amazon distorts a larger economic picture that we have. When you talk about moving from 3% of your transactions to the rest 97% then you need to think about what is the digital preparedness of your transaction system and in that we have two major weaknesses. One weakness is simply the fact that your internet connectivity is very poor. So if your internet connectivity is very poor then your ability to digital transactions is also limited. For instance the point of sales machines today are connected to largely the internet. Point of sales machines are really in the 15 top cities in the country. So that's the other side of it. Credit card swiping machines therefore are useless if you don't have point of sales machines. When you come to using banking transactions now again the banking transactions to your internet is again depends on the internet connectivity. Mobile could have been used more effectively if you had focused that as your primary mode of transaction. Now we haven't done that. We are now encouraging e-wallet companies and so on. We are talking about payment banks. Airtel wants to start a payment as already started a payment bank. We have to see how it comes up but the problem that we have in the mobiles most of the mobile payment system will end up by needing smart phones and smart phones at the moment are not very as prevalent as to cover more than I think 300 million people. So roughly about 700 million people have SIM cards. Out of that only 300 million people have smart phones. Out of that broadband communication which is probably what you really require for transactions are with only about 130-140 million. So the picture is not particularly bright over there. The government is saying you don't need we will introduce a system where you will not need point of sales machines. What you will need is just your thumbprint and with that you will go with your and they will check with your other system. It still means the merchant at the other end will need a connection to the internet to check the other validation. So these are all systems which they are talking of being built up. You know the ultimate analysis is the issue is very simple. The digital infrastructure has to precede the drive towards a cashless economy or a less cash economy. It cannot be you start giving people less cash and then you say now we will build the digital infrastructure. It's clearly a question of build putting the card before the horse. Clearly I mean there's a lot of challenges and this is a story that is still sort of work in progress and we hope to come back to you for some of the other issues that we have in address. Thank you very much.