UID Project :Vision for a new India - I

One of the most ambitious projects announced by the newly elected UPA government is its intention to issue a unique identification number to each citizen of India.Each person is to be issued a smart card carrying basic information such as name,date of birth etc. as well as biometric data such as fingerprints.For the purpose the government has set up a body called the Unique Identification Authority of India and roped in Infosys co-founder Nandan Nilekani to head the body.To enable him to pursue his task in a hassle-free manner,he has been given the rank of a Cabinet Minister and given full freedom to choose his own team members-whether from the private or the public sector.It is estimated that the project is going to cost the exchequer 1.5 lakh crores.The first phase is expected to be rolled out in 18 months and 10,000 crores have been earmarked for the same.This phase would cover the beneficiaries of various social sector programmes being run by the government such as the NREGA.

The purposes behind this massive exercise are multiple:

1.)It is expected that the biometric system will help identify and target in a better manner the intended beneficiaries of various government schemes and subsidy programmes such as the NREGA,Public Distribution System and the myriad BPL schemes.At the moment,we have a comic(and outrageous!) situation where the total number of ration cards and BPL cards far exceed the number of people entitled to them.According to Mr.Swaminathan Ankleswar Aiyar,a TOI columnist,we have 223 million ration cards issued against a entitled population of 180 million and 80 million BPL cards issued against an entitled population of 65 million.(Data for the no. of eligible beneficiaries comes from government's own surveys.)In the state of Karnataka alone,the number of BPL card beneficiaries far exceeds the state's entire population,let alone the number of BPL families!!What this basically implies is the existence of 'phantoms' as Mr.Nilekani puts it in his book 'Imagining India'.These are people who exist only on paper i.e either they never were or are long dead.Also taking advantage are people who don't qualify for these benefits. These phantoms are often a creation of the authorities and shopkeepers who use them as a tool to siphon off the subsidised rice,wheat,kerosene and sugar from the allotted quota and sell them in the open market at market rates.As a result PDS is now a totally rotten system with leakages exceeding 50%.Its a double whammy for the state- subsidised goods don't reach the intended beneficiaries and oil marketing companies end up making massive losses on kerosene which is heavily used for transport in place of diesel since subsidised kerosene is much cheaper than diesel. More on the PDS in a later post.The smart card along with a simultaneous drive to increase penetration of banking services in rural India would allow the government to transfer subsidies in cash form to the entitled by depositing them in their accounts,thus eliminating all levels of interaction in between and by implication pilferages.The smart card reader at the outlet providing the subsidised service or good to the consumer would deduct the amount from his account thus ensuring that the cash is not spent on anything it's not intended for.

2.)It is the intention of the government to ensure that the relationship between the state and citizens be made as little traumatizing as possible for the latter by making the process transparent.As of now,the implementation of any scheme and flow of funds is completely at the mercy of corrupt and immoral bureaucrats.The authority levels are too many which ensures that of every rupee spent on the poor,only 5 paise reach them.A smart card linking each citizen to a national database will ensure that they are getting their due since each transaction will be recorded using the card. Bureaucrats won't be able to sit pretty by distributing funds merely on paper.

3.)It will force the government to acknowledge the plight of the poor and helpless by forcing it to acknowledge their 'existence'.The government would no longer be able to draw a veil over large-scale poverty and destitution by simply ignoring the as of now nameless poor.This in turn would force it to ensure that they are provided for.

4.)It will help to check large-scale illegal immigration in India from countries such as Bangladesh.According to estimates there are more than 2 crore Bangladeshis illegally residing in the country.These immigrants not only place a strain on the nation's resources,a large number of them are a serious security threat as well.Ditto for Pakistani intelligence agents,terrorists and other illegal citizens known in diplomatic parlance as 'aliens'.

5.)Citizens will be saved the hassle of carrying on their person a number of different documents such as passport,ration card,PAN card,voter ID card,birth certificate,caste certificate,driving license etc. for different purposes.

6.)It will help in making financial transactions much more transparent,eliminate instances of holding bank accounts using multiple PANs,expose fake voters and fake government employees.Surprised by that last bit,eh?Be prepared to receive the shock of your life by the next few lines.Recently in Delhi,where I've been staying for the last couple of months,a shocking scandal came to light.It has been discovered that 45,000 employees of the Municipal Corporation of Delhi(MCD)are non-existent(are either dead,fictitious or drawing salaries as government employees without working apart from pursuing regular professions).For the past 20 years,salaries and perks were being regularly drawn against their names.These employees were mostly appointed to lower level posts such as sweepers, gardeners etc.Despite repeated complaints by citizens of absence of these workers from their jobs,little or no action was taken by higher authorities.Not surprising considering that these officers were receiving a cut from those salaries to keep their mouth shut!What finally let the cat out of the bag was the municipal commissioner's decision to issue biometric identity cards to employees for attendance purposes.The cards were supposed to be issued when the employees came to give their attendance.Since the phantom employees' attendance used to be marked by the attendance officer himself, the fraud wasn't exposed for a lot of years.When these fictional employees didn't collect their cards,the matter came out into the public domain.There was an immediate uproar and some of the employees reported to work.People in some localities got the shock of their lives when they saw their washerman,gardener or local printer of many years sweeping streets early in the morning!!This shows the power of technology in improving civic facilities and making the government and its employees accountable to the people and gives a peek into what the future might hold for us if the unique ID card project becomes a success.

7.)Transparency in financial transactions i.e. being able to put a name to each transaction taking place will help in detection of financial activities of terrorist and militant organizations,atleast those which are taking place through legal channels.A year back or so,National Security Advisor M.K.Narayan had admitted that terrorist organizations had been active in the stock market.Not only that,a number of sympathisers of these organizations regularly send money through legal banking channels apart from the more popular and illegal hawala route.Being able to track these payments would help in choking supply of funds to these unscrupulous elements.

Howsoever well meaning the intentions of the project may be,the challenge of implementing it on the ground is enormous.By Nilekani's own admission,he expects it to be a challenge greater than he's ever faced when he says,"I'm supposed to work with 600 different departments of the government,no two of which ever work together."
There are a number of factors,circumstances and forces which will test Nilekani's resilience,perseverance and determination as he goes about his task.In the next post I intend to discuss some of the potential bottlenecks,possible misuses of the card as well as provide a detailed description of the technological aspects of the smart card and its supporting infrastructure.