Is the Rajasthan government’s free-phone scheme directly benefitting Reliance Jio?

A review of official government orders suggests that one company is likely to benefit most from the Rajasthan government's ''Bhamashah Digital Parivar Yojana'' scheme: Mukesh Ambani’s Reliance Jio Infocomm Ltd. Arun Sharma/Hindustan Times/Getty Images
17 September, 2018

On 4 September, Rajasthan’s chief minister Vasundhara Raje announced the “Bhamashah Digital Parivar Yojana,” a scheme under which the state government would provide free mobile phones to help citizens access government services digitally. Money will be transferred to the bank accounts of families who are eligible under the National Food Security Act to enable them to purchase a smart phone and a data connection. The scheme was announced ahead of state assembly elections, which are due later this year. Soon after the announcement, the Congress accused the Rajasthan government of “bribing voters” with free smartphones using taxpayer money. According to an Indian Expressreport, around 1.03 crore families in Rajasthan are entitled to receive benefits under the NFSA.  These families are part of Bhamashah—a scheme in Rajasthan under which the eldest woman in the family is issued a card that can be used to avail government services.

A review of the official government orders and my conversations with government officials suggest that one company is likely to benefit most from the scheme: Mukesh Ambani’s Reliance Jio Infocomm Ltd.

In early September, the principal secretary of Rajasthan’s information technology and planning departments, Akhil Arora, sent a directive—a copy of which I accessed—to all district collectors, asking them to hold mobile-phone distribution camps in every block of the state, where the eligible citizens can purchase subsidised smart phones. Although the directive mentions that the scheme could be availed through “various mobile operators,” it only identifies one tie-up by name, through which the mobile phones are being made available at the government-facilitated camps—the “Jio Bhamashah Programme,” with Reliance Jio. The directive states, “Jio representatives, whose names and numbers are given in Annexure A, will be in touch with District Collectors.” No details regarding any representatives from other mobile operators are given in the directive. It adds further that at least two camps must be held in each block, from 1 September until the end of the month. The directive also states that the cost of the infrastructure for running the camps will be borne by the mobile operator.

Annexure A is titled “Main Points of Jio Bhamashah Programme” and indicates that Jio camps are being held in each tehsil of Rajasthan’s 33 districts. It contains technical details about the Jio phones that will be sold under the scheme, and a nine-page list with the names and phone numbers of Jio Centre Managers, or JCMs, and mobility leads for each tehsil. Pankaj Pandey, who is listed as the mobility lead for Ajmer tehsil, explained that a mobility lead is responsible for sales and distribution while a JCM is responsible for overall operations.

The annexure notes that under the Jio Bhamashah programme, the family of each eligible Bhamashah card holder is entitled to two mobile phones. It states that the phone will be made available to the beneficiary upon a payment of Rs 501, which will be refundable after 3 years, upon return of the device, and that apps to avail of government services will already have been installed in the phones. The annexure adds that six recharges costing Rs 99 per month will be given to the users, allowing them unlimited calling, up to 600 SMSs a month, and data of 1 GB a day for the first three months, and 512 MB data and 300 SMSs a month for the next three.

A government official in Ajmer district, whom I spoke to on 16 September, and who asked not to be named, told me that the government had provided lists of Bhamashah and NFSA beneficiaries to Reliance Jio and government agencies at the block and panchayat levels. “We have given the lists of beneficiaries to Jio and Block Development Officers and Gram Sevaks, because they have to facilitate the location of the camps,” he said.

When I asked him how many camps had been held and how many people had attended, he said that Sourabh Jain, who is listed in the annexure as the JCM for Ajmer Tehsil, would have the exact figures. I called Jain. He identified himself as a “Jio lead manager.” He said that he was at a mobile camp, but was not authourised to speak to the media. A call to Abhishek Gaur, Jio’s Rajasthan spokesperson, went unanswered. Sheetal Albal, a general manager with Jio who is based in Rajasthan, declined to answer questions.

“Reliance Jio gave a concrete plan to the government which was approved. The government also said other companies were free to participate and while Airtel and Vodafone have talked about participation, but haven’t submitted a concrete plan as of date,” the Ajmer district official said.

An official with the state’s IT department, who also asked not to be named, explained how the scheme works. A government subsidy of Rs 1000 is being credited directly into the bank accounts of the eligible beneficiaries, in two installments of Rs 500 each. The first installment is given for the purchase of the device, while the second installment, which is to be released only once the first has been used, is for the data connection. The official specified that the beneficiary was free to purchase a device from a place other than the government-facilitated camps, but that if it cost over Rs 500, they would have to pay “from their own pocket.” I asked which companies were participating in the camps. He said that Reliance, BSNL, Vodafone, Airtel and “more or less all” were participating. When I pointed out that Vodafone and Airtel did not sell mobile handsets, he said that Reliance Jio was selling devices. He also mentioned Karbonn, but was not able to provide any further details.

Vodafone India and Idea Cellular have just undergone a corporate merger. According to a corporate executive at Vodafone, the merger meant that the new company, Vodafone Idea Ltd, would not participate in Rajasthan’s Digital Parivar scheme.

Most English-media reports regarding the scheme appear not to have identified Reliance Jio as the telecom operator associated with it. Contrastingly, Hindi news reports described the scheme as a Jio programme—The Rajasthan Patrika carried a report that mentioned Jio in the headline, while a ZeeNews report noted that the government had asked district collectors to run  Jio camps in each district. A verified YouTube channel named Rajasthan GK Store, which has over 150,000 subscribers, uploaded a video on 2 September, explaining the scheme. The video cited a Hindi news report that explained the Jio programme, terming it the government’s free-phone scheme.

A story regarding the scheme that was published by the news website The Print states that the BJP hopes to exploit its social-media presence through smartphones. Citing unnamed BJP sources, the story notes, “The distribution of smart phones was part of the party’s strategy to exploit its strong social media presence ahead of the elections. The BJP had stormed to power in 2014 on the back of its social media efforts. It now hopes to replicate the success in these two states through the smartphone distribution.”