A Special Analysis by Bhamy Shenoy – Much before the Parliamentary Standing Committee on Finance (SFC) could publish its report there have been continued opposition against the Aadhaar project run by Unique Identification Authority of India. Before one could understand as to why this article is written against those critics its imperative for us to understand what Aadhaar – actually – is.

Aadhaar is a twelve digit individual identification number issued by the Unique Identification Authority of India (UIDAI) on behalf of the Government of India. This number is to serve as a proof of identity as well as address – anywhere in the country. Any individual – irrespective of age and gender – who is, also, a resident in India besides satisfying the verification process laid down by the UIDAI can enroll for Aadhaar. Enrollment, which is needed only once, is free of cost. Each Aadhaar number will be unique to an individual and will remain valid for his entire lifetime.

Aadhaar number is to help individuals provide access to services like banking, mobile phone SIM and other Government as well as Non-Government services in due course.

Here are few important things about Aadhaar:

1. Aadhaar will be easily verifiable in an online, cost-effective way
2. It is unique and robust enough to eliminate a large chunk of duplicate and fake identities in the government as well as private databases.
3. It is a random number generated, devoid of any classification based on caste, creed, religion and geography.

Considering this it’s all but natural to support and yet the kind of criticism we find from the media is rather discouraging to the core. This criticism has now turned to be a torrent. It is understandable why the political class would oppose Aadhaar; they’d obviously be the single largest losers if the project is implemented in Toto. One would have expected that the NGOs – especially the ones concerned with consumer protection and rural/slum development – would give their wholehearted support to this initiative. But, alas, they too are all against it. This fact is saddening because NGOs most definitely realize the rampant corruption across the system while implementing a government welfare measures and Aadhaar has everything in it to resolve this long standing issue.

SCF has not advanced any new arguments and/or rationale to support the opponents of Aadhaar in opposing this project and yet all the critics, including the media have used this opportunity to put old wine in new bottles to kill Aadhaar by selectively quoting from the SCF report.

Not much is discussed about the fact that there have been three MPs who have dissented with the majority opinion. While the good news is that there has been no political infighting in completing the SCF report the bad part is that very political class who are showing extraordinary interest in fighting corruption has thrown away one of the almost foolproof weapons provided by Aadhaar to reduce corruption. Only the self interest of the politician is the main driving force behind such rare political unanimity.

Below, however, are ten solid reasons to support Aadhaar:

1. Aadhaar can plug the gross misuse of government subsidies: There is not [even one] kind of encouraging word mentioned in the SCF report on how Indian society can use Aadhaar to deliver several welfare measures approved by the parliament to the poor. This is because the political class (which prepared this very report) is the biggest beneficiary of black money generated by diverting PDS kerosene and residential LPG as well as from the misuse of several welfare measures like Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA), Below the Poverty Line (BPL) schemes and the like away from the true beneficiaries.

2. Aadhaar is a tool to deliver welfare measures without approval from the parliament: Once a welfare program like PDS Kerosene, subsidized food, MNREGA, access to high-tech facilities are approved by the government, is there a need for the executive branch to get approval as to how best deliver such programs with minimum leakage? Consider this example: In mid-90s, at the suggestion of Mysore Grahakara Parishat, Karnataka Government had implemented “coupon” system to ensure minimum diversion of PDS kerosene in Mysore. It was so successful that the government wanted to expand it to the whole state. However, the deals and all the political parties managed to kill the project. When I recall the parties critical about Aadhaar I cannot but feel as if history is repeating itself.

3. Aadhaar does not compromise privacy: Many are raising the issue of privacy. This is just another – totally bizarre – point, raised; driver’s license demands lot more information than Aadhaar. Voters list too has a lot more information on citizens. If these don’t invite any hue and cry, then, why with Aadhaar?

4. Biometric technology gives adequate accuracy: Many including the SCF have pointed out the inherent problems of the biometric technology in accurately identifying the individuals. While the government has admitted that the accuracy may be no more than 1%, it has also suggested that there are in-built safety mechanisms not to deny any legitimate person the assistance approved by the government. After all biometric technology is relatively new and is making rapid advances. According to UK’s National Physical Laboratory, probability of a false negative (person not being recognized) is 1 out of 10000 using biometric. The probability of false positive is 1 out of 1,000,000.

5. Aadhaar is better than US Social Security ID: SCF has cheery picked the UK example to argue that Aadhaar may not work because the Government of UK has decided to drop their national ID card scheme. Why didn’t SCF discuss examples of several countries like Brazil, Australia, US and others where biometric cards/documents are in use? Importantly, there are many similarities between the social security number system in the US and Aadhaar in India. A country like the US where privacy issues, human rights, etc are high on the agendas has not found any problem. Aadhaar is really a more sophisticated concept for SSN of the US. If the US were to implement SSN now, more than likely they would develop a scheme like India’s Aadhaar. SSN is given to any legal resident of the US and so also Aadhaar. SSN has not created any serious issue. The same will be the case with Aadhaar. It can be argued that India has leapfrogged the US by implementing Aadhaar.

6. Aadhaar does not create any insurmountable security problem: Some have tried to create a scare by suggesting that Aadhaar should be treated as a national security issue though SCF has not discussed Aadhaar directly from that point of view. In today’s networked society, there are so many databases which should be of much higher priority in terms of national security than a database containing biometric information on residents of India. On the other hand it can be argued that Aadhaar database may serve the purpose in getting information on terrorists. In some countries there are proposals to use biometric databases to monitor movement of terrorists. By being creative and through building adequate safety features Aadhaar could make it very difficult for anyone to access Aadhaar data while it can serve the national security purpose by identifying terrorists.
   

7. Savings due to Aadhaar is worth the cost for Aadhaar : It was shocking to find SCF referring to some newspaper article quoting a high cost figure of INR 150,000 crores while the total budget requested for UIDAI is for about INR 12,000 crores for three phases. Even assuming that the actual cost may be more than what is budgeted, the avoidance of black money generation of just diversion of PDS kerosene and res. LPG alone of INR 45,000 crore per year can easily pay for Aadhaar project. In addition there is the additional money savings from improved welfare delivery systems like food, fertilizer, MNREGA etc for which Aadhaar can be used. When SCF took the opportunity to scare the readers by quoting an unsubstantiated cost figure of 150,000 crores, it did not take any effort to find out the potential savings from the use of Aadhaar. A recent Karnataka Lokayukta’s report estimated that the misuse of food subsidy alone costs more than INR 1740 crores per year for Karnataka.

8. 50 countries are using biometric technology for various identification purposes: A report published by International Telecommunication Union in 2009 should any doubt people may have about the use of biometric tool for individual identification. That report has the following conclusions:

“Within a fairly short period of time, biometric recognition technology has found its way into many areas of everyday life. Citizens of more than 50 countries hold machine-readable passports that store biometric data – a facial image and in most case a digital representation of fingerprints – on a tiny RFID chip to verify identity at the border. Law enforcement agencies have assembled biometric databases with fingerprints, voice and DNA samples, which make their work more efficient and manageable. Commercial applications use biometrics in local access control scenarios, but also increasingly in remote telebiometric deployments, such as e-commerce and online banking, and complement or replace traditional authentication schemes like PIN and passwords.”

9. Failure of government bureaucracy cannot be held against Aadhaar: It is true that coordination between different departments of the government who are the stakeholders (Planning Commission, Registrar General of India, Election Commission, Ministry of Rural Development, Ministry of Urban Development, and State Governments) has not been satisfactory. It is also true that there has not been proper planning or coordination between different users of Aadhaar or ways of using it for deriving maximum benefits out of Aadhaar (NPR, MGNREGS, BPL, census, UIDAI, RSBY, and Bank Smart Card). The fact that the bureaucracy has failed or the government machinery has not done its job in coming with an efficient ways of making use of new technology like Aadhaar should not reduce its usefulness. It is also true that prior to taking up a major project like Aadhaar, UIDAI should have conducted a cost benefit analysis and looked at all different alternatives. Unfortunately it failed. Instead of taking a positive view of the study done by Ernst and Young, SCF was critical of it to send back of the bill. The study did show that among all different alternatives Aadhaar is the best. Instead of making positive recommendations to improve the inner workings of the government department in exploiting a tool like Aadhaar to throw doubts on the efficacy of Aadhaar is doing disservice to the country. A high level committee consisting of elected representatives can be expected to take an unbiased view of a new initiative like Aadhaar. SCF report unfortunately is biased. The committee report quotes opinions of only the experts who are critical of the project. Did they try to find at least one expert who is in favor of the project?

10. Concerns raised by the SCF are either irrelevant or inconsequential:  There are several nit picking issues raised against Aadhaar in SCF to question its usefulness. For example is Aadhaar mandatory or not? For those who do not want to avail themselves of welfare assistance it is not mandatory. Human rights and privacy activists should appreciate such a position. Is ration card mandatory today? It’s not! However, for those who want subsidized food items or PDS kerosene it is mandatory. Is there any thing wrong in imposing Aadhaar on the beneficiaries to ensure there is no leakage? Aadhaar can definitely serve to identify but not as a proof of address. Is there anything wrong with that? Can drivers license issued many years back or old water/telephone/electricity bills serve as proof? The same truth with Aadhaar. Aadhaar is only to serve as identity from beginning and not serve any other purposes. Only with the purpose of throwing superstition of Aadhaar these nit picking issues are raised. It is very unfortunate that the staff of SCF has not done a creditable job in advising only they had done an unbiased review and ended with some specific recommendations to make better use of Aadhaar.

The parliamentary committee argued convincingly that UIDAI has failed to do a better job of coordinating with different departments, failed to carry out proper cost benefit analysis prior to starting of the project and failed to have a well laid out plan to exploit the application of Aadhaar for different uses. But none of this can lead to dropping or even worse kill Aadhaar as many have assumed. If the committee had taken an unbiased view its conclusion would have been far more positive putting India on a different trajectory to fight corruption in a big way.

In conclusion it can be stated that just like Lokpal bill can help reduce corruption, proper and well planned use of Aadhaar can reduce corruption and have transformational impact. Arvind Kejrival, who has fought against corruption in PDS, should convince Anna Hazare to support the government in moving ahead with Aadhaar. Just like Lokpal, Aadhaar has all the potential to be a game changer.

About the author: Dr. Bhamy Shenoy, an IIT Madras graduate has a Ph.D in business administration from University of Houston. From 1997 till 2003 he was involved in legal, regulatory and commercial reform in former Soviet Union countries of Kazakhstan, Uzbekistan, Turkmenistan, and Georgia as an USAID consultant. Later in an honorary capacity, he worked as a board member and advisor of the National Oil Company of Georgia. In Georgia he was able to expose high level of corruption in petroleum sector and recommended a series of steps to reduce it. His study has helped the government to improve tax collection in petroleum sector significantly.