Strengthening Governance through Blockchain Technology

Syllabus: GS2/ Governance. GS3/ Science and Technology

Context

• India is accelerating its adoption of blockchain technology to transform governance, enhance transparency, and strengthen digital trust through the National Blockchain Framework (NBF).

What is Blockchain?

• Blockchain is a distributed, transparent, secure, and immutable database that functions like a ledger of records or transactions, resistant to tampering and accessible across a network of computers.
• Understanding Types of Blockchain:
  • Public Blockchain: In this network, all nodes can access records, verify transactions, perform proof-of-work, and add new blocks.
  • Private Blockchain: It is a permissioned blockchain, restricted to selected participants within an organization. 
  • Consortium Blockchain: In this network, the blockchain is semi-decentralized, governed jointly by multiple organizations for shared data management and validation.
  • Hybrid Blockchain: It is a blend of public and private blockchains allowing selective data access.

National Blockchain Framework (NBF)

• Developed by the Ministry of Electronics and Information Technology (MeitY), NBF was launched in 2024 with a budget outlay of ₹64.76 crore.
• NBF is designed to accelerate the development and deployment of permissioned blockchain-based applications, marking a strategic step towards building a secure, transparent, and scalable digital infrastructure for India.

Key Components of NBF

• Vishvasya Blockchain Stack: It is an indigenous and modular platform designed to provide the technical foundation for building and deploying blockchain-based applications for governance. The features of Vishvasya Blockchain Stack are:
  • Blockchain-as-a-Service (BaaS): Vishvasya enables rapid development and deployment of blockchain applications for governance, providing third-party cloud-based infrastructure and management so that organizations can launch blockchain applications without maintaining complex infrastructure themselves.​
  • Distributed Infrastructure: The stack is deployed across NIC data centres located in Bhubaneswar, Pune, and Hyderabad, ensuring fault tolerance, scalability, and resilience for blockchain-based applications.
  • Permissioned Blockchain Layer: The platform is built on a permissioned blockchain, ensuring that only verified and authorized participants can join or validate transactions.
  • Open APIs and Integration Services: Vishvasya provides open APIs (Application Programming Interfaces) and integration modules for authentication and data exchange.
• NBFLite – Blockchain Sandbox for Startups and Academia: A sandbox environment for startups, academia, and research institutions to prototype blockchain applications in governance.
• Praamaanik: It is an innovative solution that leverages blockchain technology to verify the authenticity and source of mobile applications.

Blockchain-Enabled Applications Transforming Governance

• Certificates and Document Chain: The chain allows secure issuance, storage, and retrieval of documents such as academic certificates, caste, income, ration cards, driving licenses, and birth or death certificates.
• Logistics Chain: Provides a tamper-proof and transparent platform to track goods across multiple stakeholders.
  • Example: Karnataka’s Aushada system tracks medicines from manufacturers to hospitals, verifying quality, expiry, and traceability, reducing the risk of spurious drugs.
• Property Chain: Ensures transparency in land and property transactions, allowing verification of ownership and rights, minimizing disputes, and expediting resolution processes.
• Judiciary Chain: Blockchain facilitates electronic delivery of notices, summons, and bail orders, reducing delays and eliminating manual dependencies.
  • The Inter-operable Criminal Justice System (ICJS) integrates the criminal justice ecosystem, ensuring a unified digital platform for case records, evidence, and judicial documents.

Initiatives for Blockchain Adoption in India

• The Centre of Excellence in Blockchain Technology (NIC) provides consultancy, training, and support for pilot projects, using platforms such as Hyperledger Fabric, Hyperledger Sawtooth, and Ethereum.
• RBI is leveraging blockchain for the Digital Rupee, enabling traceable, secure, and inclusive digital payments.
• Telecom Regulatory Authority of India (TRAI) has integrated blockchain-based Distributed Ledger Technology (DLT) to track SMS transmissions for regulatory compliance and consumer protection.
• The National Securities Depository Limited (NSDL), has introduced a Distributed Ledger Technology (DLT)–based blockchain platform for Debenture Covenant Monitoring, marking a major step in modernizing India’s capital markets.

Conclusion

• Various blockchain-based use cases are being studied across sectors to enhance efficiency and trust in public services. 
• Key Proof of Concepts (POCs) include Land Records for secure ownership records, Blood Bank for transparent donation tracking, GST Chain for real-time tax monitoring, and Public Distribution System (PDS) for secure supply chains.

Source: PIB