The Indian Government is gearing up to introduce a legislation in Parliament in the first week of next month, looking to get parliamentary sanction for its Unique Identity Project, Aadhaar. So far, without Parliamentary sanction, the country has issued around 478.5 million identity numbers. The Unique Identification Authority of India (UIDAI), has been operating “under an executive order issued by the Government in January 2009, establishing UIDAI as an Attached Office of the Planning Commission.” The bill being introduced proposes to create a statutory authority to be called the National Identification Authority of India and lay down the powers and functions of the Authority, the framework for issuing Aadhaar numbers, defines offences and penalties and matters incidental thereto through an Act of Parliament.

Readers must bear in mind that the identity project has been sanctioned without India having a privacy law. A Parliamentary Standing Committee was severely critical of the Aadhaar project (Details of that here. Download the standing committee report here) In a press release, almost two years hence, the Indian government has responded to this criticism:

1. Circumvention of Parliament: The Law Ministry cleared the project even though the bill has not been passed by Parliament. The committee called this unethical. Dr. Usha Ramanathan pointed out, “It is a plain misconception to think that the executive can do what it pleases, including in relation to infringing constitutional rights and protections for the reason that Parliament and legislatures have the power to make law on the subject.”

Government’s response: “The issuance of Aadhaar was based on the opinion of the Ministry of Law and Justice and the opinion of the Attorney General of India which had clearly stated that the UIDAI can continue to function under the executive order issued by the Government and there is nothing in the law, or otherwise, which prevents the Authority from functioning under the executive authorization.”

2. National Security Issues: The bill proposes to entitle all residents and not just citizens an aadhaar number, and this is worrying, given issues of illegal immigration and infiltration. “As the National Identity Cards to citizens of India are proposed to be issued on the basis of aadhaar numbers, the possibility of possession of aadhaar numbers by illegal residents through false affidavits / introducer system cannot be ruled out.”

Government’s response: “The Aadhaar letter clearly spells out that it is only a proof of identity and not citizenship.”

3. Privacy: That “the collection of biometric information and its linkage with personal information of individuals without amendment to the Citizenship Act, 1955 as well as the Citizenship (Registration of Citizens and Issue of National Identity Cards) Rules, 2003, appears to be beyond the scope of subordinate legislation.” Also that “In the absence of data protection legislation, it would be difficult to deal with the issues like access and misuse of personal information, surveillance, profiling, linking and matching of data bases and securing confidentiality of information etc.” The law is at a draft stage, and the UIDAI began collecting data without protections being in place.

Government’s Response: “UIDAI recognizes that the right to privacy must be protected and provisions have been made in the Bill for protection of information.”

4. Unreliable technology, high cost, absence of study on financial implication, duplication of effort with National Population Register exercise and inability to ___ in covering full or near full the marginalised sections. Estimated failure of biometrics is expected to be as high as 15% due to a large chunk of population being dependent on manual labour.

Government’s Response:
– UIDAI, in terms of technology has already generated more than 44 Crore Aadhaar and is currently processing over 1 million Aadhaar per day with a capacity to undertake 180 trillion biometric matches per day. This makes it the largest database of its kind in the world.
– Aadhaar is aimed at building a basic Identity and Verification infrastructure for welfare and inclusive growth.
– It is important to note that the cost projections for the UIDAIproject has also been earlier approved by the Government of India for total amount of Rs 12,398.22 crore as compared to Rs. 150,000 Crore as reported in some media reports some time back. The total cumulative expenditure incurred by UIDAI,since inception ofthe Project, is Rs. 3490 Crore as on September 30 2013.
– A Cost-Benefit Analysis of Aadhaar Project conducted by the National Institute of Public Finance and Policy (NIPFP) shows that the Internal Rate of Return (IRR), in real terms, generated by Aadhaar would be 52.85%.

They’ve also identified benefits that the government forsees:

Benefit to Government:
i) Can verify that a genuine beneficiary is claiming the benefit (at a Banking Correspondent for money or at a PDSoutlet for grain); and,
ii) Reach – can provide services in every nook and corner of the country as long as connectivity is there.
Benefit to individual:
i) Convenience – A resident can get access to services close to where they are.
ii) Mobility – A resident can access services throughout the country.
iii) Empowerment – Since the resident has a choice of outlets for a particular service (go to any BC to withdraw money or any PDS outlet to withdraw grain), the bargaining power shifts to the resident. This also reduces corruption.
(c) Electronic-Know Your Customer (e-KYC) – Resident authorized provision of government photo ID consisting of Proof of Identity (POI) and Proof of Address (POA) to an authorized agency.
Benefit to Government:
i) Productivity – Instant paperless provisioning of services has great impact and productivity benefit for the economy.
ii) Inclusion – Can provide access to services like bank accounts and mobile connections anywhere easily.
iii) Audit – Every KYC request has a unique transaction code, cannot be repudiated, and can be easily investigated.
Benefit to resident:
i) Instant access – Provides instant access to services just with his Aadhaar number.
ii) Convenience – These services can offered anywhere there is connectivity.
(d) Aadhaar as a Financial Address – An Aadhaar-linked Bank account that can receive money just with the Aadhaar number as the address.

5. Voluntary? While the claim is that it is voluntary, there is apprehension that services or benefits including food entitlements would be denied in case people do not have aadhaar number.

Government’s response: “It has been clarified that Aadhaar number is an enabler, with a purpose of effective delivery and benefits by establishing identity of the resident. All schemes have some prequalification and there is no reason why possession of Aadhaar should not be one, especially if efforts are made to ensure availability of Aadhaar to all who want it. The actual requirement and the use of Aadhaar will be determined by the implementing ministries/agencies.”

Translation: Aadhaar can be made mandatory, and people without Aadhaar numbers can be excluded.

Our Take

It’s quite evident that the government hasn’t addressed issues related to circumvention of Parliament, the lack of proper privacy provisions or the issues with collection of data (such as instances of vegetables being given Aadhaar numbers). Even if it is just Rs 3490 Crore, and not Rs 12,398.22 crores that has been spent, it has been spent without Parliamentary approval on a project which can impact the freedom of citizens in this country. The issue of redundancy, with both NPR and Aadhaar being created, has also not been addressed. Other issues raised by the Parliamentary standing committee Apart from the fact that it hasn’t adequately addressed the above concerns, the government has also failed to address other raised by the Parliamentary Standing committee:

– Multiple Identity Proofs: “Continuance of various existing forms of identity and the requirement of furnishing, other documents for proof of address, even after issue of aadhaar number, would render the claim made by the Ministry that aadhaar number is to be used as a general proof of identity and proof of address meaningless. In addition to aadhaar numbers being issued by the UIDAI, the issuance of smart cards containing information of the individuals by the registrars is not only a duplication, but also leads to ID fraud as prevalent in some countries.”

– Issues with other government departments: The Ministry of Finance (Department of Expenditure) pointed out that “lack of coordination is leading to duplication of efforts and expenditure among at least six agencies collecting information (NPR, MGNREGS, BPL census, UIDAI, RSBY and Bank Smart Cards)”; Ministry of Home Affairs are stated to have raised serious security concern over the efficacy of introducer system, involvement of private agencies in a large scale in the scheme which may become a threat to national security; National Informatics Centre (NIC) have pointed out that the issues relating to privacy and security of UID data could be better handled by storing in a Government data centre; Involvement of several nodal appraising agencies which may work at cross-purpose; and that several Government agencies are collecting biometric(s) information in the name of different schemes.

– Registration issues: “the Ministry of Home Affairs had alleged that some of the registrars have not adhered to the laid down procedures under UIDAI which renders the Memoranda of Understanding (MoU) signed between the UIDAI and the registrars meaningless; and it compromises the security and confidentiality of information of aadhaar number holders.