Finance Minister Arun Jaitley reiterated the Union Government’s stand against crypto currencies such as bitcoin in the 2018 Union Budget. However, regarding blockchain technology, he stated that it will be utilised by Government, as it allows the organisation of records without intermediaries.
What exactly is blockchain?
Blockchain is a growing list of records that are linked to each other. In other words, it is like a spreadsheet that has been duplicated across a network of computers, and the network is designed such that it regularly updates the spreadsheet. Blockchain stores blocks of information identically across its network. This means that it cannot be controlled by any single entity, and has no single point of failure. Blockchain can be utilised for various purposes by the government, for example, to implement a secure record-keeping system. This can especially helpful with respect to land registries.
Blockchain technology can be easily leveraged for this purpose. How? It allows to create permanent public “ledgers” of land data, which can then be viewed by all parties involved - banks, brokers, government and so on. This will result in faster land transactions, along with an assurance on transparency. The files or data cannot be manipulated across the board, since doing that will require overriding the entire work, and if the data is manipulated, then it can be easily traced since transaction data and timestamp are also encoded in a ‘block’. The introduction of a blockchain land registry could potentially secure land ownership. The current system of property transfer involves a great deal of delay and bureaucratic haggling. It involves physical ledgers that bureaucrats can easily manipulate. Somebody’s land can be usurped by a set of fake documents - the fact that right to property is not a constitutional right doesn’t help either.
However, land records are being made digital through Digital India Land Records Modernization Programme. But this system is not hack-free, it is still susceptible to subversion by bad actors. This is why blockchain can be transformative.
India could greatly benefit from utilising this technology to rectify its land governance woes. With a trustworthy and enforceable land ownership, the financial markets will benefit greatly, along with the citizenry.
The authors would like to thank Mandar Kagade for his inputs.
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