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This article was first published 8 years ago  » Business » Aadhaar:Nearing a billion and counting, connectivity remains a problem

Aadhaar:Nearing a billion and counting, connectivity remains a problem

By Sahil Makkar & Mayank Mishra
April 01, 2016 09:25 IST
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Aadhaar now has legal backing but it still faces challenges of privacy and data sharing. With enrolment numbers creating history now, we take a look at strengths & weaknesses in the system.


For Chaju Singh, a resident of Haryana's Rohtak district, getting his monthly pension has become a hassle.

He has to visit his bank branch every month to claim the amount.

"We spend Rs 100 on travelling to get a monthly pension of Rs 1,000-1,200. It is difficult for pensioners to travel to a bank every month. Even then, the payment is not guaranteed because of frequent authentication failures," says the octogenarian farmer, fondly remembering the earlier system when the village headman or revenue officer would come home and distribute the pension amount. 

Singh and many like him are getting used to the change necessitated by the adoption of Aadhaar-enabled platforms to dispense welfare schemes such as pensions, scholarships and direct benefits transfer of, say, domestic cooking gas subsidy.

Each beneficiary is given a 12-digit unique identification number. Biometric details - iris mapping and fingerprints - are digitally tagged to the number to eliminate ghosts and duplicates.

But access to bank branches, banking correspondents (BCs) and automatic teller machines (ATMs) is still limited for millions.

In such a case, those entitled to the benefits of welfare schemes under the new regime are going to face a new set of challenges.

The government has created a delivery platform without the necessary infrastructure in place, say critics.

"All these things have to happen simultaneously," says Nandan Nilekani, former chairman of the Unique Identification Authority of India (UIDAI).

"In my previous report on payment infrastructure five-six years ago, we had talked about BCs getting adequate commission, which is 3.14 per cent, with a cap of Rs 15 per transaction. That recommendation has not been implemented."

That might explain the reason for poor BC penetration.

Notwithstanding the challenges associated with last-mile connectivity, the UIDAI exercise can be called a success.

In less than seven years of its existence, it is about to enrol a billion residents.

And the milestone has been achieved at a fraction of the cost of similar exercises elsewhere in the world, claim officials.

Nilekani claims the programme also has the potential to save the government nearly Rs 1 lakh crore a year by plugging the loopholes in the system.

But UIDAI's journey has not been smooth. The agency survived seven long years without the backing of a legislation. Critics have targeted the project for compromising on privacy issues.

"Aadhaar makes the citizen transparent to the state but makes the state completely opaque and unaccountable to its citizens," says Sunil Abraham, executive director of Bengaluru-based research organisation The Centre for Internet & Society.

The backers of Aadhaar, however, say the system has mechanisms to protect privacy.

They argue that biometric details are required to establish identity and it also entails the participation of the individual concerned in the process.

Nothing can happen without the individual's consent. If no transaction can take place without his consent, it empowers him, rather than taking away any right, they argue.

"Aadhaar is a true foundation of what some people rightly call the 'India Technology Stack' of paperless, presence-less, cash-less and friction-less governance," says Ram Sewak Sharma, former director-general of UIDAI.

For now, UIDAI is in talks with more government departments to adopt the platform for welfare schemes.

It is also in talks with the state governments to adopt Aadhaar as a preferred platform for direct benefits transfer. Currently, the Aadhaar-enabled platform is being used to implement schemes such as the Mahatma Gandhi National Rural Employment Guarantee Scheme, the Pradhan Mantri Jan Dhan Yojana, payments of pensions by the Centre, the states and the Employees' Provident Fund Scheme.

It is also used by the public distribution system and for the distribution of cooking gas and kerosene subsidies. With a legislation in place now, the coverage is likely to be extended to other schemes.

The government's focus on Aadhaar, however, has taken a toll on the National Population Register (NPR).

The government has spent Rs 4,500 crore to compile the NPR, a precursor to a National Register for Indian Citizen which involves issuing a smart identity card as citizenship proof.

According to the Citizenship (Amendment) Act, 2003, the Registrar General of India must create this citizens' register and issue identity cards after verifying documents and antecedents.

To expedite the process, the government also allowed UIDAI to collect biometric and demographic details. Initially, UIDAI was tasked with de-duplicating NPR data and generating Aadhaar.

It was also supposed to hand over the biometric data to NPR.

The expansion of the scope of UIDAI resulted in a bitter turf war among the various arms of the government.

The battle ended with the government on Tuesday notifying the Aadhaar Bill, but other issues remain.

The Bill restricts UIDAI from sharing data with any government or private agency, which creates uncertainty about how NPR will get the biometric from UIDAI.

In the one-billion enrolment, NPR's contribution is 280 million.

Another challenge of the data collecting agency is to capture biometric and demographic details of the residents of the Northeast for overall inclusion.

The progress here has been slow. For example, its penetration in Mizoram and Assam, where the influx of illegal Bangladeshi migrants is considered to be the highest, is less than five per cent.



The Unique Identification Authority of India (UIDAI) is established through a Cabinet decision as an attached office to the erstwhile Planning Commission


In September, the first Aadhaar number is generated


In November, then home minister P Chidambaram objects to UIDAI demand of increasing its mandate of enrolling more than 200 million

In December, a parliamentary standing committee asks the government to rework the UIDAI Bill-2010


In January the Cabinet rules against the home ministry's objection and allows the UIDAI to enrol 600 million

In May, Chidambaram accuses the UIDAI of objecting to National Population Register (NPR) camps; says the UIDAI is not accepting NPR data despite a Cabinet decision

In June, Cabinet asks the UIDAI to accept NPR data


In February, then prime minister Manmohan Singh sends the citizenship card scheme to a group of ministers

In May, the UIDAI launches e-KYC service


Nilekani quits the UIDAI to contest the general elections on a Congress ticket

In July, new Prime Minister Narendra Modi reverses his stand on UIDAI after meeting Nilekani


In September, the UIDAI is attached to the Department of Electronics and Information Technology


In March, the Lok Sabha passes the Aadhaar Bill after rejecting five amendments proposed by the Rajya Sabha; citizenship card scheme is awaiting nod

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Sahil Makkar & Mayank Mishra in New Delhi
Source: source

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