Centre for Internet & Society

Poor management, corruption and fraud are threatening to derail the world’s largest national identity project.

The blog post by Aayush Soni was published in Ozy.com on May 11, 2018.


For Phoolmati, a resident of the Kusumpur Pahari slum in south Delhi, standing every month in a queue at the neighborhood fair-price shop was a trusted routine. When her turn came up, she would place her thumb on a scanning machine that confirmed her identity. But on a biting-cold morning this past January, she had to return home empty-handed because, the shopkeeper told her, the “server was down.”

The next day, it happened again. On her third try, Phoolmati thought she had gotten lucky when the machine scanned her thumb successfully. But she was in for a shock. “The shopkeeper told me that, according to the computer records, I’ve already taken my quota of wheat flour for the month,” she says. When she protested and showed her ration card, another form of identification, the shopkeeper wouldn’t accept it.

Left with no choice, Phoolmati had to buy wheat flour from the open market at 25 rupees per kilogram — more than 12 times the amount she usually paid at fair-price shops. She wasn’t alone. At a weekly meeting of slum residents in a temple courtyard in April, many women complained about the difficulty of buying subsidized food grains to the Satark Nagrik Sangathan (Alert Citizens Organization), a nonprofit that seeks accountability from government agencies. Nanno Devi, a 67-year-old homemaker whose fingers are wrinkled with age, said that she didn’t receive her quota of wheat flour for January because a fingerprint-scanning machine couldn’t detect her thumb impression.

Nor are the urban poor, like Phoolmati, the only ones with such complaints. Students with government scholarships, senior citizens with pensions, farmers entitled to subsidies, religious minorities and backward castes eligible for benefits, patients at public hospitals, young couples trying to get married and professionals updating their bank details are all on the front line of an unparalleled experiment that was meant to help them but is hurting them instead.

Theirs is the lived experience of Aadhaar, a unique 12-digit identity system that includes an individual’s biometrics and demographic data — and that must verify an individual’s identity for the government, increasingly, to even recognize their existence. First rolled out in 2010, it is modeled on America’s Social Security number system, with the aim that government subsidies and welfare programs reach the intended beneficiaries and aren’t siphoned off by middlemen.

But over the past three years, India’s Narendra Modi government has cajoled, pressured and often effectively forced people into enrolling for this ID, even though it isn’t required by law. Today, a person’s bank account risks being frozen if it isn’t linked to her Aadhaar number. Her PAN (permanent account number) card, used to file income tax, could be declared invalid. Mobile phone companies can disconnect her number if it isn’t authenticated through biometrics. An Aadhaar number (or an enrollment number, in case someone has already applied for it) is mandatory to open a new bank account, get a new passport, invest in mutual funds or register a marriage. A joke making the rounds on Twitter is that very soon, Aadhaar will be mandatory for a person to swipe right on Tinder.

In the absence of any privacy law, much of the concern within sections of India’s educated middle class has focused on questions about personal freedom, data security and mass surveillance. But a parallel tide of complaints is rising from those the program was meant to help, rooted in complications it has instead imposed upon them. This growing frustration is threatening to derail the initiative in a manner privacy can’t, in a nation where millions live in cramped city apartments with strangers, and the distinction between personal and public is often blurred.

Cases of fraud, mismanagement and corruption hurting Aadhaar beneficiaries are tumbling out into the public domain almost every week. In late March, hackers used weaknesses in the Aadhaar database to steal data from a government organization that manages more than $120 billion in the pensions and savings of millions of Indians. In January, a 10-year-old girl from the Dalit community — historically at the bottom of India’s caste ladder — was denied a school scholarship because officials had misnamed her on her Aadhaar card. Last October, a farm loan waiver program in Maharashtra state ran into trouble after officials discovered that 100 farmers had the same Aadhaar identity number.

The Modi government maintains that it takes both the security of personal data and the concerns of Aadhaar beneficiaries seriously. But it is reluctant to answer any questions about identity theft, corruption, privacy or misappropriated benefits. Neither Ajay Bhushan Pandey, the current CEO of the Unique Identification Authority of India (UIDAI), which runs Aadhaar, nor Vikas Shukla, its spokesperson, responded to multiple requests for comment.

At a public rally in early May, Modi — who had himself opposed the program before he came to power in 2014 — called critics of Aadhaar “opponents of technology” unwilling to evolve with the times. Increasingly, though, many are questioning whether it’s Aadhaar’s own identity that has changed the most from when the idea first came up. “From a project of inclusion, it has become a project of exclusion,” says Usha Ramanathan, a lawyer who focuses on issues of development and poverty. Just ask Phoolmati.

Aadhaar was the brainchild of Nandan Nilekani, a former CEO of tech giant Infosys, who in a 2009 book argued that multiple forms of identification made it “difficult” to establish a “definitive identity” for India’s citizens.

A single identity linked to passports, PAN cards and other national databases, Nilekani argued, would not only solve this problem but also help eliminate the exasperating processes that India’s bureaucracy is notorious for — mountains of paper, proof of identity in triplicate and a glacial pace of work. It would help citizens avail government benefits that are rightfully theirs. Such a system would reduce a citizen’s dependence on distribution mechanisms susceptible to leakages and make “the moral scruples of our bureaucrats redundant,” Nilekani wrote. “An IT-enabled, accessible national ID system would be nothing less than revolutionary in how we distribute state benefits and welfare handouts.”

That same year, the Congress Party–led United Progressive Alliance government offered Nilekani a chance to translate his idea into reality, appointing him UIDAI chairman. Under Nilekani the UIDAI hired people from within the Indian bureaucracy as well as those outside it. The initial team of 50 included software engineers, designers and entrepreneurs from Silicon Valley as well as lawyers and policy wonks who worked at the head office in New Delhi. Each of the eight regional offices had a staff of 20.

In its early-stage avatar, the team had thought out solutions to problems such as the ones the residents of Kusumpur Pahari faced, says a policy consultant who worked with the UIDAI in 2010 and spoke on condition of anonymity. “You can use old methods and physically verify a person’s name and address [by going to their house] if biometrics aren’t working,” the consultant says. “It’s built into the architecture [of Aadhaar].” In his view, the current government under Modi — whose Bharatiya Janata Party defeated the Congress Party and came to power in 2014 — and the UIDAI setup have made a “mess” of the program. He also believes that the goal has shifted from inclusion to mass enrollment. Nilekani did not respond to a request for comment.

For sure, Aadhaar has staunch supporters too, who argue that it has helped reduce the misuse of government subsidies. In July 2017, India’s junior minister for consumer affairs, food and public distribution, C.R. Chaudhary, told the country’s Parliament that Aadhaar had helped the government delete nearly 25 million fake ration cards that the poor use to access subsidized food ingredients.

“This unnecessary fearmongering around Aadhaar is uncalled for,” says Sanjay Anandaram of iSpirit, a software industry think tank. In his view, it’s “last-mile deployment challenges” like fingerprint authentication, one-time-password systems and server glitches that need to be fixed, not Aadhaar. He juxtaposes anecdotal examples of people struggling to gain benefits with the “larger purpose” he believes Aadhaar serves. “It is a revolutionary system to ensure governance improves — especially for centrally administered programs,” he says.

The UIDAI has made some efforts too, if not to improve security of personal data then at least to allow citizens to check whether their Aadhaar identity has been misused. They can go online and view any occasions when their Aadhaar identity was used to access benefits.

But for millions of Indians dependent on subsidies, pensions, scholarships and other benefits, the concerns go well beyond privacy. Getting an Aadhaar identity can be a struggle. Earlier this year, the Punjab government conceded that it can’t process nearly 200,000 farm loan waiver claims either because intended beneficiaries don’t have Aadhaar cards or because the UIDAI is still processing their applications. At the same time, not signing on to Aadhaar is increasingly not an option. In February 2017, Chaudhary’s ministry made it mandatory for individuals to have an Aadhaar card to access subsidized food grains. Then, in October, an 11-year-old girl died of starvation in the central state of Jharkhand because the local ration dealer refused to give her family food grains for six months, as they had not linked their ration cards to Aadhaar. Facing criticism, the government asked states not to deny the poor the food grains they are entitled to, but the incident underscored how the Aadhaar initiative is cutting the needy off from subsidy access, rather than helping them, suggests Ramanathan, the lawyer. “People are dying because of Aadhaar,” she says.

But the Modi government has shown no signs of rethinking either the ways in which Aadhaar appears to hurt the poorest in Indian society or its data security protocols. Instead, it has appeared keener to target whistle-blowers pointing out weaknesses in the initiative.

It cost Rachna Khaira, a reporter, only 500 rupees ($7.50) to access the entire Aadhaar database — the names, addresses, fingerprint scans, iris scans, mobile phone numbers, email addresses, postal index numbers (PINs) and Aadhaar numbers of 830 million Indians. She “purchased” the service offered by anonymous sellers on WhatsApp and transferred the money via Paytm, a popular digital wallet company, to an “agent,” who created a “gateway” for Khaira. He then gave her a log-in ID and a password to that gateway, which allowed Khaira unrestricted access to the Aadhaar database. Her report, published in January in The Tribune, one of India’s oldest English dailies, created a national stir. Instead of trying to plug the holes the report had revealed, the UIDAI filed criminal cases against Khaira and the newspaper, accusing them of breaching privacy.

Khaira’s wasn’t the first piece of evidence to expose the vulnerability of the Aadhaar database. In May 2017, a report by the Centre for Internet and Society, a nonprofit organization, claimed that 130 million to 135 million Aadhaar numbers were published on four websites: the National Social Assistance Programme, the National Rural Employment Guarantee Scheme and two projects run by Andhra Pradesh state. “This is the largest exercise in the world of the conversion of public information into an asset and then its privatization,” says Nikhil Pahwa, editor of MediaNama and a critic of Aadhaar.

These breaches of security highlight corruption and mismanagement that belie claims the government continues to peddle. In April 2017, Ravi Shankar Prasad, India’s minister of information and technology, told Parliament that “Aadhaar is robust. Aadhaar is safe. Aadhaar is secure, and totally accountable.” The government hasn’t appeared too perturbed by privacy concerns. On July 22, 2015, Mukul Rohatgi, the then attorney general, argued before the country’s Supreme Court that “the right of privacy is not a guaranteed right under our constitution.” That set off a two-year-long hearing before a nine-judge bench of the court, which unanimously ruled in 2017 that the right to privacy was indeed a fundamental right.

The criticism from social groups Aadhaar was meant to benefit, though, has left the Modi administration on the defensive. Since the passage of the 2016 Aadhaar law, civil society activists have filed 12 petitions in the Supreme Court challenging its legality. In January, the All India Kisan Sabha, one of India’s largest farmer organizations with millions of members, petitioned the top court against government moves to link subsidies to Aadhaar identities. Some leaders from Modi’s party, the BJP, have also started questioning their own government in Parliament about cases of beneficiaries denied their due because of the Aadhaar program. The Supreme Court, which is holding regular hearings on the case, has extended indefinitely the date by which citizens must link all identity documents to their Aadhaar number, until it rules on the validity of the legislation. At stake is the trust the Indian people can place in their government.

Back in Kusumpur Pahari, much of that trust has already eroded. In his 2014 election campaign, Modi had promised to stand guard as a chaukidaar (watchman) over the country’s resources, to prevent corruption. But when someone illegally withdrew Phoolmati’s grains by using her Aadhaar identity, the watchman wasn’t able to stop the theft.

For Phoolmati and other residents of Kusumpur Pahari, their ration cards guaranteed them food, and were a rare pillar of certainty in an unstable life. The Aadhaar-linked fingerprint authentication system is a source of frustration, and they don’t want it, they make clear at their weekly meeting. They now get their ration some months, and other months they don’t. Life on the fringes of society was already tough. Aadhaar, they say, has made it harder still.