Diljit Dosanjh

Aadhaar is a pivotal identity initiative launched by the Indian government in 2009. It is a 12-digit unique identification number assigned to residents of India, based on their biometric and demographic data. Aadhaar has grown to become the world’s largest biometric ID system, with over 1.3 billion individuals enrolled by 2023. This article delves into the origins, framework, applications, advantages, challenges, and future of Aadhaar in the Indian context.

Origins and Development

The need for a reliable and uniform identity verification system in India was long felt, given the vastness and diversity of its population. Before Aadhaar, India had various forms of identity proofs like voter IDs, PAN cards, and ration cards, but these were not universal, had significant duplication issues, and were prone to fraud. Hence, the government sought to create a system that could uniquely identify every resident, reduce identity fraud, and ensure efficient delivery of services.

In 2009, under the leadership of Nandan Nilekani, the Unique Identification Authority of India (UIDAI) was set up by the Government of India. The mandate was to issue a unique identification number to every resident based on their biometric and demographic information. This would not only simplify identity verification but also improve access to government subsidies and benefits, especially for marginalized sections of society.

Framework of Aadhaar

The Aadhaar system is based on collecting two forms of data: biometric and demographic.

1. Biometric Data: This includes an individual's fingerprints, iris scans, and a photograph. This data ensures that each Aadhaar number is unique and can be used to verify a person’s identity in real time.

2. Demographic Data: This includes details such as the individual’s name, date of birth, gender, address, and mobile number.

The uniqueness of Aadhaar lies in the biometric data collection, which ensures that no two people can have the same Aadhaar number. Unlike many other identity systems, Aadhaar does not assign an identification card; instead, it provides a virtual identity through a 12-digit number.

The Aadhaar infrastructure was designed to be secure and robust, with the UIDAI functioning as the central authority responsible for the system’s governance, issuance of Aadhaar numbers, and maintaining the data. Aadhaar has become the foundation for several digital services under India’s e-governance framework.

Applications of Aadhaar

The applications of Aadhaar have evolved over the years, becoming an integral part of government schemes and digital services. Some key areas where Aadhaar is used include:

1. Direct Benefit Transfers (DBT): Aadhaar has been instrumental in reducing leakages in government welfare schemes. By linking Aadhaar to bank accounts, the government can directly transfer subsidies, pensions, scholarships, and other benefits to eligible beneficiaries. This has reduced corruption and middlemen from the process.

2. Financial Inclusion: The Aadhaar-based e-KYC (Know Your Customer) process has simplified the opening of bank accounts, enabling millions of unbanked individuals to access formal banking services. The Pradhan Mantri Jan Dhan Yojana (PMJDY) aimed at financial inclusion leveraged Aadhaar to open millions of accounts with minimal documentation.

3. Public Distribution System (PDS): Aadhaar has helped streamline the distribution of food grains under the PDS by preventing duplication and eliminating ghost beneficiaries. It ensures that only eligible individuals receive the benefits.

4. Subsidy Programs: Aadhaar is linked to subsidies for LPG gas cylinders, fertilizer distribution, and the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). This reduces subsidy leakage and ensures that benefits reach the rightful recipients.

5. Digital Identity for Online Services: Aadhaar enables people to use a single identity for various online services, such as filing income tax returns, applying for government scholarships, and digital signatures through Aadhaar-based authentication. It supports India's Digital India initiative by making services more accessible.

6. Health and Education: Aadhaar is also used in health initiatives like the Ayushman Bharat health insurance scheme and for student enrolments to ensure transparency in the delivery of services and prevention of duplication.

7. Telecom and Financial Services: The use of Aadhaar for e-KYC in the telecom sector has simplified the process of acquiring new mobile connections and has played a role in preventing the misuse of SIM cards. Similarly, in the financial sector, Aadhaar has streamlined processes for availing loans, insurance, and mutual funds.

Advantages of Aadhaar

Aadhaar’s impact has been profound across various sectors. Some of its major advantages are:

1. Reduction in Fraud and Duplication: With biometric authentication, Aadhaar ensures that each individual has a unique identity, minimizing the chances of duplicate or fraudulent identities. This has reduced corruption and made government schemes more efficient.

2. Financial Savings: By directly linking Aadhaar with DBT, the government has saved billions of rupees that would otherwise have been lost to leakages and middlemen. The efficiency of Aadhaar has contributed to significant cost reductions in subsidy distribution.

3. Inclusion of Marginalized Groups: Aadhaar has empowered marginalized sections of society by making identity verification easier. Those without formal documentation now have a legitimate identity through Aadhaar, which helps them access various public services, including banking.

4. Ease of Access: Aadhaar’s digital nature has made it easier for individuals to verify their identity remotely. Aadhaar authentication can be done online through mobile phones or biometric devices, facilitating access to services from remote areas.

5. Efficiency in Governance: Aadhaar has brought transparency and accountability to government processes. With the Aadhaar-enabled Public Distribution System (PDS), for example, ration shops now distribute goods more effectively, and the number of ghost beneficiaries has been reduced drastically.

6. Boost to Digital India: Aadhaar has significantly contributed to the success of the Digital India campaign, enabling the digitization of numerous services, enhancing government-citizen interaction, and promoting a cashless economy.

Challenges and Concerns

Despite its many advantages, Aadhaar has faced several challenges and criticisms since its inception.

1. Privacy and Data Security: One of the primary concerns is related to the privacy of individuals and the security of their biometric data. Although the UIDAI claims to have robust security systems in place, instances of data breaches have raised questions about the safety of such sensitive information.

2. Exclusion: While Aadhaar aims to be inclusive, there have been cases where individuals, especially the elderly and disabled, have faced difficulties in biometric authentication. These cases of authentication failure, where people are unable to access services due to incorrect biometric data or system errors, are significant concerns.

3. Legal and Constitutional Issues: Aadhaar was challenged in court on the grounds of privacy violations. In a landmark 2017 judgment, the Supreme Court of India ruled that the right to privacy is a fundamental right. While the court upheld the constitutionality of Aadhaar, it restricted its mandatory use to certain services, such as income tax filing and welfare schemes, but not for services like opening bank accounts or acquiring SIM cards.

4. Operational Issues: The vast population size and diversity of India pose significant operational challenges. Enrolment centers may not always function efficiently, leading to delays in issuing Aadhaar numbers, and there have been complaints of inaccurate data entry during registration.

5. Dependence on Technology: Aadhaar is heavily reliant on technology, especially in rural areas where digital literacy and infrastructure can be inadequate. People without smartphones, computers, or access to the internet may struggle to take full advantage of Aadhaar-enabled services.

6. Function Creep: Over time, Aadhaar has been used for purposes beyond its original scope, raising concerns about the growing reach of the state in tracking and profiling individuals. Critics argue that Aadhaar should remain focused on welfare distribution rather than expanding into areas like law enforcement or private sector uses without proper regulation.

Legal Framework and Safeguards

To address concerns around privacy, the Indian government passed the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits, and Services) Act, 2016. This law outlines the legal framework for the collection and usage of Aadhaar data and restricts the use of Aadhaar authentication to welfare schemes and certain other services.

Additionally, in response to privacy concerns, the Personal Data Protection Bill has been proposed, which will provide a comprehensive framework for data protection, including safeguards for Aadhaar data.

The Supreme Court’s 2018 ruling also laid down certain safeguards for Aadhaar use. It limited the scope of mandatory Aadhaar linkage to essential services like government welfare schemes, subsidies, and income tax returns, while prohibiting its compulsory use for private services like banking and telecommunications.

Future of Aadhaar

Looking ahead, Aadhaar is poised to play an even larger role in India’s digital economy. With India moving towards a more digital-first governance model, Aadhaar is likely to remain central to e-governance and the delivery of public services.

Technological advancements may help overcome some of the operational challenges associated with Aadhaar, especially in rural areas. For instance, the use of mobile-based authentication and offline verification methods can improve access to Aadhaar services.

As Aadhaar continues to evolve, data privacy and security will remain a key focus. The government’s efforts to introduce stronger data protection laws will help build trust and safeguard the privacy of individuals. Aadhaar’s future success will also depend on finding a balance between using the system for public good and preventing misuse or overreach.

Conclusion

Aadhaar has been a transformative initiative for India, revolutionizing the way identities are managed and services are delivered. While it has faced challenges, particularly around privacy and exclusion, Aadhaar has brought significant benefits, especially in terms of transparency, efficiency, and financial savings in government programs. Going forward, Aadhaar will likely remain a cornerstone of India’s digital infrastructure, and with appropriate safeguards, it can continue to play a pivotal role in the country's socio-economic development.