Published: Friday, Dec 16, 2011, 8:00 IST
Place: Bangalore | Agency: DNA
A parliamentary panel rejecting the Unique Identity (UID) Bill may have come as a big setback for the UPA government. But for the IT industry, the impact seems minimal, at least from a monetary point of view.
Looking at the bigger picture, the Bill if passed - and it’s a big if — would mean Rs16,000 crore worth of projects for the industry as a whole. But for an individual vendor, the figure doesn’t translate into much. The whole idea behind peddling that number was primarily to speed up the work.
Accenture, Wipro, MindTree, HP and TCS are among the IT players which have been awarded the contracts, which include design, development and maintenance of intranet and management portals, according to the official website of the Unique Identification Authority of India (UIDAI). The mandate for them was to build an ecosystem around various UID projects.
The first UID contract to become a consulting partner for UIDAI is of the size of Rs7.05 crore, which has gone to consultancy firm Ernst & Young.
The contract size for Bangalore-based MindTree, which was among the first companies to strike such a deal, was Rs19 crore. Though no one from MindTree could be reached for an official confirmation, earlier reports suggest that it outbid Accenture.
Another IT major, Wipro, was awarded two deals this year — one in February and the other in May.
“The contracts awarded to IT companies were never big in size. Hence, I do not see any big impact on their balancesheet. Though they might have deployed a big human resource team, it can easily be shifted to some other project. Basically the assets can be easily mobilised,” said Kishan Bhat, engagement manager, Zinnov, a leading management consulting company.
In the same vein, Bhat clarified that the short term is a different play altogether and so, it’s difficult to gauge long-term ramifications.
If the Bill falls through, it will have a cascading effect on various other government initiatives as companies may try to steer clear of them. “E-governance is the way forward. The government should make all efforts to make it work even if it means to make little changes here and there,” said an expert on condition of anonymity. He added that though IT companies have little to lose as they have other big projects in hand, it is the government which has a lot at stake.
Though some felt that a UIDAI freeze may lead to some increase in costs for companies, most others declined to validate the same. The parliamentary committee headed by former finance minister Yashwant Sinha has pointed to several loopholes in the existing Bill and urged the government to “reconsider and review the UID scheme as also the proposals contained in the Bill”. The committee raised concerns about privacy, identity theft, misuse, security of data during the implementation of the UID scheme.