National Blockchain Framework: Strengthening Governance through Blockchain Technology

The Ministry of Electronics and Information Technology (Meity) formally launched the National Blockchain Framework (NBF) on 4th September 2024 with a sanctioned budget outlay of Rs. 64.76 crore (cr).

• The framework would provide a unified architecture for deploying blockchain solutions across various sectors.

Key Highlights

Issues in existing system: India’s current governance framework is primarily dependent on centralized data systems, which often encounter issues related to data manipulation, inefficiency, and limited transparency.

• Blockchain technology addresses these challenges through its tamper-resistant, distributed ledger system, where records are securely maintained across multiple nodes.

Purpose of NBF: 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

Vishvasya Blockchain Stack: It is designed to provide the technical foundation for building and deploying blockchain-based applications for governance.

• Blockchain-as-a-Service (BaaS): Vishvasya provides blockchain infrastructure as a shared service.
• This allows government entities to deploy blockchain-based applications without the need to create or manage their own infrastructure.
• Distributed Infrastructure: The stack is deployed across NIC (National Informatics Centre) data centres located in Bhubaneswar (Odisha), Pune (Maharashtra), and Hyderabad (Telangana).
• This distributed network architecture ensures 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: It allows startups, research institutions, and students to prototype blockchain-based applications in a controlled environment without requiring full-scale deployment.

• It comes bundled with smart contract templates in key governance and industry domains such as Supply Chain and Digital Certificates.

Praamaanik: It is an innovative solution that leverages blockchain technology to verify the authenticity and source of mobile applications.

• When users scan or check an app, Praamaanik matches the details with blockchain records to validate its legitimacy.

National Blockchain Portal: The platform supports innovation, standardization, and cross-sector adoption of blockchain for applications, fostering trust and enhancing India’s leadership in emerging technologies.

Applications in India’s Governance

Certificates and Document Chain: To overcome the use of fraudulent documents and delays in service delivery, the NIC has adopted Blockchain technology to build a ‘Certificate Chain’ for secured storage and retrieval of such records.

Logistics Chain: This provides a secure and transparent platform for tracking the movement of goods or resources across multiple stakeholders.

Judiciary Chain: It uses blockchain to enhance transparency, efficiency, and trust within the justice system by providing a secure, immutable, and time-stamped record of judicial data and documents.

Inter-Operable Criminal Justice System (ICJS): The ICJS integrates the criminal justice ecosystem, ensuring a unified digital platform for case records, evidence, and judicial documents.

Property Chain: The Blockchain-powered property Management System ensures that every property transaction is securely recorded on the blockchain and all stakeholders can access the complete transaction history before making decisions.

Strategic Roadmap and Regulatory Initiatives

Centre of Excellence (CoE) in Blockchain Technology (BCT): The NIC has established a CoE to serve as a platform for government departments to receive consultancy, training, and support for developing pilot projects.

• It provides blockchain-related services and ICT (Information and Communication Technology) infrastructure that help departments connect their systems.

Role of TRAI in BCT: The Telecom Regulatory Authority of India (TRAI) has implemented blockchain-based Distributed Ledger Technology (DLT) within the telecom ecosystem, mandating all Principal Entities (PEs) and Telemarketers (TMs) to register their message transmission chains.

• This integration facilitates comprehensive, end-to-end tracking of SMS communications from origin to delivery.

Role of RBI in BCT: The Reserve Bank of India (RBI) is using blockchain technology to modernize India’s financial system through pilot projects such as the Digital Rupee.

NSDL Adoption: The National Securities Depository Limited (NSDL) has introduced a Distributed Ledger Technology (DLT)–based blockchain platform for Debenture Covenant Monitoring.

• The platform enables issuers and debenture trustees to record asset charges, monitor asset cover ratios, and track covenants on a secure digital ledger.

Capacity Building Initiatives

Skill development Programme: The Capacity Building Division of Digital India Corporation (MeitY) has undertaken Skill Development Programmes for Government Officials to enhance technological proficiency across departments.

• Over 214 programmes have trained 21,000+ officials in emerging domains such as Blockchain.