A conceptual framework based on the virtuous cycle of productivity gains and expanding markets explains the forces that increase digital divide and bridge it. Using this framework, India is used as an illustrative case to document attempts to utilize ICT to enhance the economic circumstances and quality of life for the rural and poor segments of the Indian population and to argue that government and other public institutions have an important role in bridging the digital divide in developing countries. Further, the direct role of government is distinguished from its indirect role.