9870 - Life after Infosys - Business Today

Life after Infosys

The founders of India's first world-beating technology start-up are helping write the next wave of success stories in several areas.

 Venkatesha Babu   Delhi     Print Edition: May 8, 2016

R. Narayana Murthy (Photo: Nilotpal Baruah)

Infosys has lost a bit of sheen as it slows and gets used to a pace more suited to companies in their middle age. But for a majority of Indians, the information technology giant will always be known as the country's first globally successful technology start-up, one that caught their imagination for, besides its epic success, embodying values such as transparency and fair play. A large part of that narrative was shaped by its founders' image of 'guys next door' who, without powerful connections, made it big through ingenuity and hard work.

While Infosys is now run by a new generation of professionals, the promoters are very much in action elsewhere, doing what they have always done best - change things for the better. They are using their not-so-inconsequential wealth and expertise to help the country get around some of its biggest problems - such as lack of quality education and archaic governance systems - while also helping create a new generation of star entrepreneurs.

"I am no spring chicken. So, I want to harness my time for public good"

BT spent time with the four key founders - N.R. Narayana Murthy, Nandan Nilekani, Kris Gopala-krishnan and S.D. Shibulal - who also occupied the CEO & MD position, to know about their life after Infosys and get their views on the opportunities in the current scenario. The other three founders, N.S. Raghavan, K. Dinesh and Ashok Arora, did not respond to requests for an interaction. Here is what is keeping Infosys's Famous Four busy these days.

The Elder Statesman

Tathagata is one of the titles of Gautam Buddha. In Pali and Sanskrit, it has two meanings - 'one who has thus gone' and 'one who has thus come'. It is an apt name for the operational headquarters of N.R. Narayana Murthy. While he may have 'gone' from Infosys and retains just the honorific Chairman Emeritus title, he has 'come' into the world of investing through Catamaran Ventures. The venture capital firm has made eight publicly known investments, including in Yebhi (online e-commerce), Innoviti (online payments), Bloom & Wild (fresh flower delivery), Lookup (messaging app), Coverfox (online insurance) and Hector Beverages.

Tathagata, nestled in the quiet, upscale residential suburb of Jaya Prakash Nagar in South Bengaluru, is a few kilometres from Murthy's house. The building is unassuming, except for the high walls and burly security men at the entrance. The security men let people in with a cursory glance once it is confirmed that they have an appointment.

At 70, most people are looking forward to a less fast-paced life. Not Murthy. The day we met him, he was looking at his itinerary for the next few weeks with his Man Friday, Pandu, who has been with him for a couple of decades now. He is running a bit behind schedule and apologises for the delay. His office, meanwhile, serves Paper Boat ethnic drinks such as 'chilled rasam, anar juice and aam panna'. Catamaran is a big investor in Hector Beverages, the owner of the Paper Boat brand.

As we get off talking about life after Infosys, Murthy does not agree with a comment that his pace has not changed since Infosys days. "Now, I get up very late. I am up only at 5.30 am. During my Infosys days, I used to be in office by 6.30 am. Now, I do a little bit of exercise in the morning and catch up on reading over coffee. I come to work only by 9 am." He says he has resigned from all boards except those of not-for-profit organisations and academic institutions such as Princeton University, Cornell University, Wharton Business School, Ford Foundation and UN Foundation. "I am no spring chicken. So, I want to harness my time for public good," he says.

On start-ups, he says there has never been a better time to be an entrepreneur in India. "We had to wait for weeks and months for every clearance when we set up Infosys in 1981. Funding was also a problem. However, I respect today's entrepreneurs as the field now is much more competitive. The other change is that Indian companies had to look for global opportunities if they wanted scale. Growth of the Indian market means that is no longer the case."

But what about the eye-popping valuations in the start-up world? "Who are we to determine whether companies are overvalued or not? Price is agreed by the buyer and the seller. There is no coercion."

If he were to launch a start-up today, he says he would still bet on the biggest differentiator an Indian company can have. "We have to leverage productivity per dollar of the Indian worker. For instance, our ability to deliver healthcare services at lower cost will be attractive. Similarly, in areas such as Internet of Things, providing education in STEM (science, technology, engineering and mathematics) to a global audience, leveraging the power of mobile ... there is no paucity of opportunities."

The elder statesman of the IT industry is also all praise for the government's initiatives around Digital India and Start-up India. "If we follow through and execute, we can create several globally competitive companies. I am a strong believer in the India story."

Besides work, he enjoys spending time with grandchildren and reading on esoteric computational mathematics. "I am off to the UK (his son-in-law is a member of Parliament there) where my daughter is planning to take me to some theatre. One of the joys of my life is ability to indulge grandchildren, as there are no attendant responsibilities," he says.

For Murthy, who built one of India's most successful technology companies, it seems that every road is paved with opportunities.

Protege Who Trod a Different Path

More than a billion Indians have got a digital identity today. This can transform lives on a scale no one could have imagined till even a few years ago. Aadhaar, as it is called, has become the launch pad for a series of reforms, right from subsidies, where beneficiaries get cash directly into their accounts, reducing leakages, to the more mundane ones such as monitoring of attendance in government offices. The credit for this goes to Nandan Nilekani, the former chairman of the Unique Identification Authority of India or UIDAI. He may have left the UIDAI but informally gives consultation to the "platform I helped create".

Nandan Mohan Nilekani (Photo: Nilotpal Baruah)

Nilekani, called variously as the architect of Aadhaar, author of two well-regarded books, successful CEO, philanthropist, a protégé of Murthy and a not-so-successful politician, operates out of a building near his home in Bangalore's Koramangala, India's start-up suburb.

After leaving the UIDAI and a "painful" loss in the Lok Sabha elections, "I found I had no work to do," he recalls. However, for many, his loss was a blessing.

"After Aadhaar, for me, the challenges had to have scale. When I heard the numbers, I felt it was worth my time. So, we created Ek Step"

For decades, his wife, Rohini, had been involved in improving literacy and numeracy skills of children in primary classes. In Boston, where he had gone to attend his son-in-law's graduation ceremony, he met a few "like-minded individuals" who, along with Rohini, encouraged him to tackle the challenges in India's primary education sector. "After Aadhaar, for me, the challenges had to have scale. When I heard the numbers, I felt it was worth my time. So, we created Ek Step with some people who had worked with me on Aadhaar."

Ek Step is a smartphone-based platform for enhancing learning. Teachers, parents, volunteers, in fact any adult, can use it to teach. The outcomes are measured thoroughly. Global experts, universities and even the World Bank have contributed to its content. The Nilekanis' have put in millions of dollars of personal wealth in the effort.

Nilekani is also involved with iSpirt, the industry body for software products. "I was not involved with the start-up sector for the five-odd years that I was with the UIDAI. iSpirt helped me realise the kind of changes that had happened during those years." The involvement led to mentoring and handholding (in most cases pro bono). In some cases, he chose to invest too.

Talking about his investment philosophy, Nilekani says he looks at teams with transformational ideas to help India's unorganised sector become organised. He adds he gives equal importance to what not to invest in. "I don't do fintech investments as I am involved in the segment at the policy and regulatory level. I work as an advisor in creating a unified payment platform that will transform mobile payments. I do this pro bono. Since I am helping define the architecture, I don't want any conflict of interest. 

Also, I don't do anything linked to Aadhaar as I helped create it. I also don't invest in for-profit edtech companies because of Ek Step. So, no Fintech, no Aadhaar-based companies, and no edtech. These are my no-go areas."

Nilekani has invested in 10 companies. Some of them work in areas such as robotics, artificial intelligence, start-up infrastructure (Tracxn, which provides a start-up database) and publishing. He has also invested in the maker of an app that connects truckers and brokers and a company that has an app for data consumption statistics. He has co-invested with Accel Partners in some cases.

"The greatest pleasure I get is in working with iSpirt and building on the Aadhaar platform for things such as authentication, eKYC, digital signatures and digital repositories. These will enable government services to be paperless and cashless. This is at the heart of re-imagining government and business, which I believe will transform India," he says. He adds that if he were starting up today, he would set up a new generation bank that will be a global technology platform but with very few employees.

Even as he divides time between philanthropy, investments and policy advocacy, he still finds time to go for long walks in Conoor, where he has a historic bungalow. The bungalow, appropriately, has a connection with Alan Turing, the 'Father of Computer Science'.

Two Amigos: Joined at the Hip

On a weekday, in the office of Axilor, an early-stage venture firm that says it improves the entrepreneur's odds of building a successful business, a slim grey-haired man walks in wearing a T-shirt, jeans and sandals. Par for the course, one would say, at a firm that works on building cool, next generation companies, till one recognises that the man is Kris Gopalakrishnan, the soft-spoken former CEO and co-founder of Infosys. Kris, along with another co-founder, S.D. Shibulal, runs Axilor, which says that it is the place where "innovation meets execution". Kris, in his previous roles, was known as a serious, buttoned-up suited-booted executive.

Kris Gopalakrishnan

Even as we question him about Axilor, Kris cuts in to share his excitement about the work that is being done on the history of Indian IT services. It is called Project Itahasa (history). "It will be in the form of an app across platforms and create a digital archive. The team and me have spoken to more than 690 people who created this industry. It will be launched shortly."

Axilor was set up by Kris, Shibulal, Harvard Business School Professor Tarun Khanna, former Infosys Director Srinath Batni, and Ganpathy Venugopal, another former colleague. It invests in early-stage start-ups. It takes in a dozen applicants and provides them co-working space and a little investment. Both Kris and Shibulal provide the mentoring.

"The thing I am most excited about is the work being done on the history of Indian IT services. It will be in the form of an app across platforms. It will create a digital archive"

Kris, however, says he spends 70 per cent of his time on not-for-profit education-related work. He is closely working with Indian Institute of Science and IIT-Madras where he has funded three chairs each on computational brain research. These work in areas of machine learning, artificial intelligence, neuromorphic computing and auditory circuits of the brain (to help the deaf). "Building fundamental research capabilities will be key to our long-term success." He has given more than Rs 300 crore for these research activities. He says he is also investing in medicine, primarily the overlap between computing and personalised medicine, but doesn't want to talk more about it till it has had some success. He also funds 400 financially challenged engineering students for four years. Each student gets Rs 4,000 a month. He is also on boards of a number of educational institutions, including IIMB, IIT-Madras and Chennai Mathematical Institute.

The two friends do much more together than investing and mentoring start-ups. Improving the education system is their common passion. Shibulal runs model schools under a foundation for primary education in Bangalore and Coimbatore. The foundation also gives scholarships to 3,000 students.

Shibulal also travels a lot as he is on the boards of a few universities such as Boston. "The good thing is all family members now can at least, once in a while, be on the same continent," he says. The day we interacted with him, he was hosting a delegation of education experts from the US. The only company he chairs the board of is his daughter Shruti's The Tamara, a hospitality venture that runs a high-end resort in Coorg (Kodagu, called the Scotland of India). Like Nilekani, he, too, escapes to the rolling hills to unwind.

S.D. Shibulal

Shibulal is also funding studies of 297 children of police personnel who lost their lives on duty. The funding commitment is for a period of 12 years for each child.

"The only thing I regret is that I do not get enough time to read given all my commitments"

While their family offices manage most of their wealth, both recently sold some of their stake in Infosys worth Rs 862 crore to fund philanthropic activities.

The Infosys founders, it seems, are in no mood to pause. 

9869 - Indian Student Hostels Ordered to Implement Biometric Authentication - Find Biometrics

Indian Student Hostels Ordered to Implement Biometric Authentication

Posted on April 19, 2016

The Social Welfare Department in the Indian city of Kolar is planning to bring biometric authentication to its student hostels.

It’s a move aimed primarily at cutting down fraud, responding to recent reports that hostels had inflated their residents’ food needs in order to receive extra subsidies from the government. As such, the hostels have been ordered to deploy biometric authentication in their dining halls in order to ensure that they can only charge public subsidies based on students’ actual use of the facilities. The move should also help to ensure that non-students can’t take advantage of the hostels.

No specific modalities have yet been determined for the biometric system, but according to The Hindu, it’s going to see a phased implementation in the district’s 105 hostels, which serve almost 4800 students.

Nor is it yet clear whether the biometric system will be linked to Aadhaar, the country’s biometric national citizen registry. But it won’t be surprise if it is—Aadhaar was implemented in large measure to improve transparency and reduce the kind of corruption that is at issue in the Kolar hostels, and has increasingly been linked to a range of important services in the country, with a major banking initiative recently announced. If implemented effectively in Kolar’s hostels, it could further illustrate how biometric authentication can be used to save government funds.

Source: The Hindu

9868 - "The system is becoming more and more reliable" - Business Today

"The system is becoming more and more reliable"

Ajay Bhushan Pandey, DG and Mission Director, UIDAI, spoke to Business Today on Aadhaar enrolment crossing the one- billion mark.

By Joe C. Mathew   New Delhi     Print Edition: May 8, 2016

Ajay Bhushan Pandey, Director General & Mission Director, UIDAI

Ajay Bhushan Pandey, DG and Mission Director, UIDAI, spoke to Business Today on Aadhaar enrolment crossing the one- billion mark. Pandey asserted that all privacy concerns have been taken care of in the new Act and the government is all set to introduce Aadhaar in more number of schemes and programmes.

How do we address the privacy issue?

We have an Act now, which says that every data, right from the enrolment time, is encrypted. So this data is not available to anyone without the permission of the person concerned. It will be in our data centre and it will remain encrypted except for a fraction of microsecond, when data is used for de-duplication and Aadhaar generation. Only for that time, it is decrypted, and thereafter, it is again encrypted. Tomorrow, let us say this data is leaked. The stolen data will be in the encrypted form. Our encryption is so strong that if anyone tries to break it, it will take the age of universe to break one set. Your data will be given without your consent only in two cases: First, if the court orders us. Secondly, in the extreme cases of national security, where a committee headed by the Cabinet Secretary authorises that the disclosure is required. So, there is a very strong privacy clause.

Is it purely voluntary?

Section 7 of the new Act says that the Central or state government can say that for this subsidy or for this programme, the funds for which is out of Consolidated Fund of India, will require an Aadhaar card. Once the Act is passed, the Central government can say that if you want scholarship, you have to give your Aadhaar number. If you want LPG subsidy, you have to give Aadhaar number.

We have seen cases where machines are not recognising fingerprint verification, especially in the case of NREGA payment. Have you been able to sort out this problem?

We have tackled this issue. That is why we have issued 100 crore cards. The other possibility is that in the entire process, somewhere in the link, there could be some glitch. And that is possible. For that one has to establish an alternate system to meet such exigencies. We have improved on this front. And the system is becoming more and more reliable. But if it is still not reliable, people should not suffer. This should be identified through some other means and benefits should be given.

How many persons are involved in the Aadhaar mission?

We have more than 320,000 operators who are certified. All of them may not be working, as there are only 40,000 enrolment centres at the moment. If more people are required, these are trained people who would be available. This will be an ongoing programme as people's faces will change, biometric will also need to be captured more than once. Their names will change, addresses will change, so updating needs to be continuous.

9867 - Aadhaar's Identity Crisis - Business Today

Aadhaar's Identity Crisis

Aadhaar enrolments have crossed a billion. But will the project make the desired impact on the ground?

By Joe C. Mathew   New Delhi     Print Edition: May 8, 2016

Nikhil Dey, a renowned social activist who has been working with peasants in the villages of Rajasthan for decades, is finding more disgruntled poor around him these days. It all began with the decision of Rajasthan government to make Aadhaar-based authentication mandatory for supply of subsidised foodgrains through the public distribution system (PDS), a couple of months ago. While the objective of biometric authentication was to ensure that the subsidised foodgrains (wheat at Rs 2 and rice at Rs 3 a kg) reaches the real beneficiary by avoiding leakages, the process seems to have made life difficult, instead of making it easy, for most beneficiaries in Rajasthan.

"If you see what is happening in ration (PDS) shops in Rajasthan, the POS machines that are meant to identify the people are a complete disaster. Not even 50 per cent of the people are able to validate themselves through these machines," Dey says.

Dey agrees that in a theoretical sense, if his fingerprint is authenticated and if it works seamlessly, it is quite a breakthrough. "But it needs to work with, say, 98 per cent efficacy, because then, for the rest of the people, you can provide subsidised rice or direct cash transfer through manual mode. But when you are identifying only 30 or 40 per cent, and majority of the genuine beneficiaries is failing to make use of the POS system, and will have to be served manually, you are not ending corruption, you are inviting corruption." All three claims made in favour of Aadhaar-linked direct benefit transfer (DBT) are doubtful, he says.

There is this claim of efficiency, stopping corruption, and of inclusion. All three are going in the opposite direction, points out Dey. "When I am going to a ration shop, putting my thumb impression, maybe the Internet is not working or the machine is malfunctioning. I am in a situation where everyone in the village, including the dealer, says I am Nikhil, but my benefit gets delayed or deprived, only because the machine says I am not Nikhil.

Here I am not included, I am excluded." Multiple attempts mean time and frustration. It's costing money, it's costing time, it's costing resources and it is not accurate, asserts Dey. "We have to delink from this theoretical world of everything working perfectly to understandwhat is practically happening." Dey says that all the "song and dance" about DBT has no meaning as it was happening very effectively even without Aadhaar. "NREGA is already a DBT. The money goes into people's post office account or bank accounts. So people are getting the benefits directly. All I am saying is that even without Aadhaar, NREGA was already DBT, and pension was already DBT."

D.K. Mittal, former mission director, DBT Scheme, and ex-secretary, Financial Services, Ministry of Finance, agrees. "There are two aspects to the Aadhaar programme.

One is to identify a person by providing him a unique number, and the other is to provide direct subsidies by using the Aadhaar bridge payment platform." While Aadhaar is a wonderful programme for the purpose of identification, it was a mistake to converge the benefit transfer scheme and the Aadhaar, believes Mittal.

"Why do you mix the two? Fiftysixty per cent of the country's population work using their hands (depend on manual labour). Their fingerprints are subject to wear and tear even within a year. Even if the finger prints remain recognisable, there are connectivity problems, which makes payments through Aadhaar bridge payment system difficult," Mittal adds.

The Elixir

The statutory backing the citizen's unique identification number got with the enactment of The Aadhaar (Targeted Delivery of Financial and other Subsidies, Benefits and Services) Act 2016, in March and its high rate of enrolment (over 100 crore) has made it convenient for governments - Central and states - to project Aadhaar and biometric identifications as the best solution for all kinds of hurdles that trouble government-citizen interface.

The Central government has already introduced Aadhaar bridge payment system to transfer cooking gas subsidy to LPG customers across the country. Four states - Andhra Pradesh, Telangana, Puducherry and Delhi - have attempted Aadhaar-linked PDS system that Rajasthan is busy experimenting with now. Some others are trying Aadhaar-linked scholarships and pension payments to eligible citizens. The government claims that all such attempts resulted in saving public money.

The DBT mission, which is now under the direct administrative control of the Cabinet Secretariat, has identified about 30 schemes where direct cash transfer can be implemented. The scope of the project has been enlarged to cover all Central sector schemes and Centresponsored schemes. Of the Rs 6,031 crore that was disbursed through the DBT mode in January 2016, 37 per cent funds were transferred using the Aadhaar bridge payment system. This includes about 61 per cent of the benefit schemes implemented by the Rural Development Ministry (including NREGA) and 62.5 per cent of cooking gas subsidy payment by the Petroleum Ministry.

Delivering a lecture on 'the new economics of financial inclusion' in Australia on March 31, Finance Minister Arun Jaitley said that the Indian financial inclusion model - of which Aadhaar is an integral part - has received international acclaim. "The deployment of JAM trinity of Jan Dhan Yojana, Aadhaar, and mobile telephones is a hugely innovative intervention to carry this (financial inclusion) forward and place government finances at prudent levels," he said.

The government's financial inclusion policy has three objectives. It aims at providing social security, affordable credit to entrepreneurs and to fix the subsidy leakage problem through targeted DBT programmes. Jaitley claims that the database of 1.2 billion bank accounts when linked with 900 million mobile phones and a billion Aadhaar numbers would effectively ensure that the subsidy flow only happens to those who actually need it.

The importance of JAM trinity has been emphasised in the government's Economic Survey 2015/16 in a dedicated chapter that talks about 'spreading JAM across India's economy'. It clearly states that the project should meet all three objectives - the government must be able to identify beneficiaries; it must be able to transfer money to beneficiaries and the beneficiaries must be able to easily access their money.

The failure of the first category leads to inclusion errors and leakage - benefits intended for the poor flow to rich and 'ghost' households, resulting in fiscal loss. The failure of the other two leads to exclusion errors - genuine beneficiaries being unable to avail benefits. The survey wanted the government to be especially sensitive to exclusion errors, which typically hurt the poorest and can be invoked as reason - and highlighted by leakage beneficiaries - to roll back DBT schemes. The second alert becomes very significant in the backdrop of the Rajasthan experience.

The survey also acknowledges that despite huge improvements in financial inclusion due to Jan Dhan, the JAM preparedness indicators suggest that there is still some way to go before bank-beneficiary linkages are strong enough to pursue DBT without committing exclusion errors. "In that sense, the JAM agenda is currently jammed by the last-mile challenge of getting money from banks into beneficiaries' hands, especially in rural India," it says. The problem highlighted by the survey is not Aadhaar authentication but absence of last-mile connectivity for banking institutions for seamless transfer of cash into the hands of the beneficiary.

P.D.T. Achary, former Secretary General of Lok Sabha

"Aadhaar Bill comes under the category of financial bills, which should have been passed by both Houses of Parliament"

While the government insists that the Aadhaar Act is meant only to facilitate DBT by identifying the genuine beneficiaries and weed out duplication and corruption, it is being proposed for all kinds of authentication purposes, including e-verification of income-tax returns to mobile SIM issuance. And it is not just the governments that are excited about Aadhaar and DBT.

Early this year, an investor note from stock broking firm Ambit Capital Pvt Ltd said that the implementation of DBT for food subsidies can result in Rs 45,500 crore annual rise in disposable incomes of targeted households, which in turn can drive a 14 per cent increase in rural FMCG demand. Hindustan Unilever, Colgate and Dabur are likely to be the biggest beneficiaries, the brokerage said.

While the methodology adopted by Ambit could be questioned, there cannot be any doubt over the business opportunity Aadhaar and DBT linkage offers for another segment - the mobile phone operators and the software companies.

While the JAM Trinity talks about mobile banking, and thereby increase the scope of services and reach of mobile phone-linked payment solutions, the technology companies are getting huge assignments from banking establishments and government agencies to turn their core systems Aadhaar-friendly.

For instance, while the current National Electronic Fund Transfer (NEFT) platform was capable of handling any load of electronic cash transfer, it needed a tweak to handle DBT through Aadhaar-linked authentication. And any change meant business for technology firms. "By compelling banks to enable Aadhaar platform, you have made them change their core banking architecture. The National Payment Corporation of India (NPCA) itself is known to have spent a substantial amount to change its core banking solutions (CBS)," says an ex-bureaucrat, who was associated with the banking sector. In fact, every bank has done, or is doing it. The front-end of all the departments that handle DBT are working on their software to have it handle Aadhaar-linked payment demands. And all this simply means huge, long-term and recurring business opportunities for the IT companies that are facing margin pressures due to the economic lull in their traditional developed country markets.

Technically Sound?

The Aadhaar Bill was introduced as a Money Bill to avoid Rajya Sabha scruitiny, where the ruling NDA government is a minority. Experts, including members of the opposition Congress Party, have expressed doubts over the constitutionality and legitimacy of this action. Some are even moving the Supreme Court, which is already hearing some public interest litigations that were filed against the plans to make Aadhaar mandatory for DBT.

"Subtle attempts have been made to give Aadhaar Bill the appearance of a Money Bill by referring to the Consolidated Fund of India (CFI) in certain clauses. But this does not alter the character of the Bill, which does not deal with the CFI," P.D.T. Achary, former Secretary General of the Lok Sabha, says. According to him, the Aadhaar Bill comes under the category of financial bills, which should have been passed by both Houses of Parliament.

Gopal Krishna, an activist associated with Delhi-based Citizens Forum for Civil Liberties (CFCL), fears that a universal Aadhaar will have far-reaching implications that go beyond an effective DBT rollout. "There are ownership risks, technology risks and privacy concerns", he says. Krishna also points out that countries like the UK, Australia, France, the Phillippines, Germany, and Europe have rejected UID/Aadhaar-like projects while Asian countries like Pakistan, Bangladesh and Nepal are moving on similar lines as that of India. "Is it a coincidence that the similar schemes are unfolding in South Asia? Isn't there a design behind persuading and compelling developing countries to biometrically profile their citizens?" he asks.

Unique ID

Even if one dismisses the conspiracy theory, the fact remains that your unique number, once included in all official documents, leaves a trail that can be traced easily even when your biometric data remains protected. It has also a positive role to play.

Aadhaar authentication can be of unexpected help, too, as was evident when floods ravaged Chennai city recently. For dozens of hapless flood victims, whose entire belongings and identification documents got washed away, fingerprint or iris authentication was more than enough to avail the official relief. The biometric identification also helped them trace back their other identities.

In a bid to get the Aadhaar Bill passed at any cost, the government has deliberately framed it as a piece of legislation meant for the targeted delivery of financial and other subsidies, benefits and services, but in essence it is a law that provides statutory backing to an authority that issues a unique number as your national identity. In that sense, the original title of the Bill, the 'National Identification Authority of India Bill 2010', is very much relevant.

Unless the Supreme Court decides on the contrary, the enrolment and seeding of Aadhaar numbers for multiple purposes will only increase in the coming days. While it will definitely enhance the business opportunities of several stakeholders, one will have to wait till the next elections to understand its success, as that is the only time the real beneficiaries get to cast their feedback as votes.

If Rajasthan is an indication, the government needs to be more cautious in its approach.

9866 - Digital Locker - Unlocking its Potential - Linked In

Rajesh Aggarwal Joint Secretary (Financial Services) at Government of India, Delhi

Digital Locker - Unlocking its Potential

• My latest, unofficial Paper on Digital Locker, and its true potential ...

http://www.egovernance.guru/wp-content/uploads/publications/papers/Digital-Locker-paper-by-Rajesh-Aggarwal-2016.pdf

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9865 - Government plans to link insurance scheme with Prime Minister Jan Dhan Yojna from May - Economic Times

Government plans to link insurance scheme with Prime Minister Jan Dhan Yojna from May

By Aman Sharma, ET Bureau | 21 Apr, 2016, 05.49AM IST

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Any BPL person going to a hospital can identify himself by Aadhaar number and get cashless treatment of up to Rs 1 lakh through the PMJDY account.

ET SPECIAL:Love visual aspect of news? Enjoy this exclusive slideshows treat!

NEW DELHI: The 21 crore Prime Minister Jan Dhan Yojna (PMJDY) accounts and Aadhaar will be used to ensure the poor get cashless treatment of up to Rs 1 lakh at hospitals under an insurance scheme announced in the budget.

Minister of state, finance, Jayant Sinha announced this on Civil Services as government plans to increase transactions under PMJDY. "This will be the first product to be launched on what we are aiming as a social security platform.

Any BPL person going to a hospital can identify himself by Aadhaar number and get cashless treatment of up to Rs 1 lakh through the PMJDY account. He will not have to dip into his meagre savings," Sinha said. Secretary, financial services, Anjali Chib Duggal said the insurance scheme will be linked to PMJDY from May. Incidentally, the districts of two opposition-ruled states are set to win on Thursday the PM award for best implementation of PMJDY — North 24 Parganas District of West Bengal and Assam's Nagaon.

The third winner for PMJDY will be Chandigarh. A presentation made before Sinha on Wednesday at Civil Services Day said average balance in a PMJDY account as on date stood at Rs 1700, the number of zero balance accounts had dropped to 27% and 95% accounts of all PMJDY accounts were opened by PSU banks. RBI deputy governor Urijit Patel credited PSU banks for the same and said private sector banks were 'found wanting' in this regard.

9864 - How a Cashless Society Could Embolden Big Brother - The Atlantic

How a Cashless Society Could Embolden Big Brother

In 2014, Cass Sunstein—one-time “regulatory czar” for the Obama administration—wrote an op-ed advocating for a cashless society, on the grounds that it would reduce street crime. His reasoning? A new study had found an apparent causal relationship between the implementation of the Electronic Benefit Transfer system for welfare benefits, and a drop in crime.

Under the new EBT system, welfare recipients could now use debit cards, rather than being forced to cash checks in their entirety—meaning there was less cash circulating in poor neighborhoods. And the less cash there was on the streets, the study’s authors concluded, the less crime there was.

Perhaps burglaries, larcenies, and assaults had gone down because there was simply less to readily steal. Perhaps, also, the debit cards deterred people from spending money on drugs and other black market goods. While nothing was really stopping them from withdrawing cash and then spending it illegally, the famous Sunsteinian Nudge was in effect—the very slightest friction in the environment pushed people away from committing crime.

The year after Sunstein’s op-ed was published, in a seemingly unrelated incident, a student at Columbia University was arrested and charged with five drug-related offenses, including possession with the intent to sell. Supposedly, his fellow students and customers had paid him through the Paypal-owned smartphone app Venmo.

Venmo makes every transaction public by default. The app features a social-network-like feed where you can see your friends sending each other varying sums of money, often accompanied with cute descriptions and emoji. The alleged dealer asked his customers to write a funny description for every transaction, and in doing so, turned his feed (and others’) into an open record of drug trafficking.

Nothing was really stopping the students from going to an ATM and withdrawing cash to use in the old-fashioned way. But that takes time and energy and meanwhile Venmo is sitting right in your pocket. The Ivy League’s best and brightest were Nudged into narcing on themselves.

In a cashless society, the cash has been converted into numbers, into signals, into electronic currents. In short: Information replaces cash.

Information is lightning-quick. It crosses cities, states, and national borders in the twinkle of an eye. It passes through many kinds of devices, flowing from phone to phone, and computer to computer, rather than being sealed away in those silent marble temples we used to call banks. Information never jangles uncomfortably in your pocket.

But wherever information gathers and flows, two predators follow closely behind it: censorship and surveillance. The case of digital money is no exception. Where money becomes a series of signals, it can be censored; where money becomes information, it will inform on you.

* * *

In the spring of 2014, the Department of Justice began to come under fire for Operation Choke Point, an initiative aimed at discouraging or shutting down exploitative payday lenders. The ends were, on the face of it, benign, but the means were highly dubious.

At the time, the need for consumer protection was painfully obvious, but payday lending was and is still legal. So the DOJ got creative, and asked banks and payment processors to comply with government policies, and proactively police “high-risk” activity. Banks were asked to voluntarily shut down the kinds of merchant activities that government bureaucrats described as suspicious. The price of resistance was an active investigation by the Department of Justice. By December 2013, the DOJ had issued fifty subpoenas to banks and payment processors.

The most vociferous objections to Operation Choke Point came from gun-rights activists, as the firearms and ammunitions industry were labeled “high-risk.” But guns were only one industry among a bizarre miscellany that had been targeted. Tobacco sales, telemarketing, pornography, escort services, dating services, online gambling, coin dealers, cable-box descramblers, and “racist materials” were all explicitly listed on the Federal Deposit Insurance Corporation (FDIC) website as “merchant categories that have been associated with high-risk activity.”

Critics of Operation Choke Point saw the initiative as a policing of vice, rather than a consumer protection campaign. Many of the targeted industries—like pornography—could be seen as morally unsavory. And in many cases—as with guns—such moral judgments were highly politicized. One pundit wrote, “[W]hile abortion clinics and environmental groups are probably safe under the Obama administration, if this sort of thing stands, they will be vulnerable to the same tactics if a different administration adopts this same thuggish approach toward the businesses that it dislikes.”

For many conservatives, Operation Choke Point was a new liberal offensive in the culture war, a backhanded attack on the Second Amendment. There was never any evidence that guns were the primary focus of Operation Choke Point, but the outrage continued, fueled by an alarming number of stories of firearms vendors being cut off by credit-card companies or suddenly having their bank accounts closed.

Similarly, porn performers began to report being cut off from the financial system in similar ways, with Chase shutting down the personal bank accounts of “hundreds of adult entertainers” in the spring of 2014. But the troubling effects of Operation Choke Point wouldn’t stop there.

* * *

Eden Alexander fell ill in the spring of 2014. It started when she suffered a severe allergic reaction to a prescribed medication. Then by her account, when she sought medical attention, the care providers declined to treat her, assuming that the problem was illegal drug use.

Alexander is a porn actress. According to her, she was profiled and discriminated against, and failed to receive due medical care. In the end, she developed a staph infection. She couldn’t work, and she struggled to take care of herself, let alone her medical bills, her apartment, her rent, her dogs.

Her friends and supporters—many of whom were also in the adult entertainment industry—started a crowdfunding campaign on the GiveForward platform, hoping to cover her medical expenses. She had raised over a thousand dollars when the campaign was shut down and the payments were frozen.

GiveForward said that her campaign had violated the terms of service of their payment processor, WePay: “WePay’s terms state that you will not accept payments or use the Service in connection with pornographic items.”

A few hours after Alexander received the notice via email, and posted about it on Twitter, she had to be taken to the hospital in an ambulance.

The initial reaction on social media was to assume that Alexander had, again, been discriminated against, and that the campaign had been shut down because of the stigma of her occupation. It turned out, however, that one of her supporters had offered to exchange nude pictures for donations to Alexander’s fund, on Twitter. (Of course, this only raises the question of how WePay had discovered the tweet, and whether they were in the habit of policing the Twitter conversations around all of the crowdfunding campaigns they were servicing.)

The suspension of payments to Eden Alexander frustrated her well-wishers and supporters. How could it be so difficult to send Alexander a small amount of money? We live in a world of abundant crowdfunding platforms, and every year brings a fresh crop of money transfer smartphone apps. In the cashless society, payments are supposed to flow more freely and easily than ever.

Of course, the abundance of forward-facing services and apps conceals the infrastructure that made Operation Choke Point possible in the first place. Transactions route through several tangled layers of vendors, processors, and banks. At various points in the chain, all transactions squeeze through bottlenecks created by big players like Visa, Mastercard, and Paypal: These are the choke points for which Operation Choke Point is named.  

The choke points are private corporations that are not only subject to government regulation on the books, but have shown a disturbing willingness to bend to extralegal requests—whether it is enforcing financial blockades against the controversial whistleblowing organization WikiLeaks or the website Backpage, which hosts classified ads by sex workers, and allegedly ads from sex traffickers as well. A little bit of pressure, and the whole financial system closes off to the government’s latest pariah. Operation Choke Point exploited this tendency on a wide scale.

It’s probably fair to say that the federal government never targeted Eden Alexander, and that her hospitalization was not a foreseeable consequence of that bare list of bullet points put out by the FDIC—the list that threw “Pornography” next to “Debt Consolidation Scams” and “Get Rich Products.”

FDIC

But subsequent statements made by WePay sketch out a cause-effect relationship between Operation Choke Point and the shutdown of Alexander’s crowdfunding campaigning, revealing how powerful the ripple effects of such initiatives could be. “WePay faces tremendous scrutiny from its partners & card networks around the enforcement of policy, especially when it comes to adult content,” a representative wrote in a blog post. “We must enforce these policies or we face hefty fines or the risk of shutdown for the many hundreds of thousands of merchants on our service. We’re incredibly sorry that these policies added to the difficulties that Eden is facing.”

Where paternalism is bluntly enforced through a bureaucratic game of telephone, unpleasant or even inhumane unintended consequences are bound to result. Looking at the FDIC bullet point list of “high-risk” industries, it’s strange to see a list of a handful of actually-illegal activities (e.g., “scams” and “Ponzi schemes”) alongside legal vices—gambling, tobacco sales, and pornography.

The Electronic Benefit Transfer system is largely benign, and indeed it is a step towards offering banking for the “unbanked”—and that in itself could be a great benefit for a segment of the population that currently must rely on payday loans and check cashing operations. However, it is part of a larger trend, pushing us closer to a world where the cashless society offers the government entirely new forms of coercion, surveillance, and censorship.

EBT nudged society’s most vulnerable closer towards the cashless society; Operation Choke Point used the affordances of the cashless society to enforce what its proponents saw as a consumer protection scheme, and what its critics saw as a campaign against vice. Choke Point rippled out across society—by assessing certain industries as “high-risk,” the FDIC pressured the financial industry into policing and punishing legal activities. Eventually this effect trickled down to WePay, which concluded it had to cut Eden Alexander off from her fundraiser.

Alexander’s ordeal was made possible by our march towards the seemingly inevitable cashless society. Where electronic payments reign supreme, the choke points become more important than ever. Cash has not always been with us—indeed, credit systems predate the use of gold and silver as money. But it is fair to say that we are seeing an unprecedented future in which the totality of financial activity is captured within the same informational system, one that can be both monitored and influenced by a powerful and sprawling administrative state.

The cashless society makes it more possible for the vulnerable to experience Eden Alexander’s ordeal. On the face of it, it’s bizarre that a consumer protection scheme resulted in what Alexander suffered. But consumer protection and anti-vice run along in the same vein: It is all paternalism, and in particular, paternal regulation of the poor.

And when it comes to anti-vice in particular, the poor suffer the most—they are held to a higher moral standard than others, and are policed and punished for straying from it. Welfare recipients must undergo invasive and time-consuming drug testing. Women (often women of color) walking in areas “known for prostitution” are hassled or even arrested for simply carrying condoms in their purse.

A cashless society promises a world of limitation, control, and surveillance—all of which the poorest Americans already have in abundance, of course. For the most vulnerable, the cashless society offers nothing substantively new, it only extends the reach of the existing paternal bureaucratic state.

* * *

The poor may be disparately impacted, but the cashless society affects everyone. And so relatively privileged technolibertarians have long feared the cashless society, seeing it as an electronic Panopticon, one of a host of privacy erosions introduced by the digital age. This fear has motivated a number of innovations, from David Chaum’s ecash (described in his 1985 paper “Security without identification: transaction systems to make big brother obsolete”), to the much-hyped Bitcoin protocol.

Chaum focused on circumventing the surveillance-capabilities of digital cash; bitcoin’s pseudonymous creator (or creators) Satoshi Nakamoto focused on eliminating the ability of trusted third parties to prevent or reverse transactions—the very capability that allows the kind of financial censorship encouraged by Operation Choke Point. These cryptocurrencies are attempts to create vents and pockets of freedom inside the future cashless world.

Their success has been, at best, dubious. I needn’t tell you about the viability of ecash. If you’ve heard of it, you already know; if you haven’t, that tells you everything already. As for bitcoin, while it has certainly seen greater adoption, the digital currency has been hit with increasing regulation, concentrated on the bitcoin exchanges which trade government currency for bitcoin. This regulatory trend has recreated the very same bottlenecks and choke points that Satoshi Nakamoto sought to circumvent in the first place.

But cryptocurrency isn’t really a federal priority, and as long as that’s the case, it can be a viable backchannel when payment processors institute blockades. Payment processors stopped serving WikiLeaks in the wake of Cablegate; eventually the organization was funded mostly through bitcoin. And when Visa and Mastercard stopped serving Backpage in 2015, sex workers also turned to bitcoin.

* * *

In June 2015, Thomas Dart, the sheriff of Cook County—the largest county in Illinois, which includes the city of Chicago—wrote an open letter to the major payment processors. “As the Sheriff of Cook County, a father and a caring citizen, I write to request that your institution immediately cease and desist from allowing your credit cards to be used to place ads on websites like Backpage.com.”

Backpage is a website that hosts classified ads, including ads from escorts. It is so prominent it has been called “America’s largest escort site.” According to several anti-sex-trafficking organizations, it is also a haven for sexual slavery. Some sex workers say, however, that if they themselves are prevented from advertising, they are put in harm’s way. “[H]aving the ability to advertise online allows sex workers to more carefully screen potential customers and work indoors,” writes Alison Bass. “Research shows that when sex workers can’t advertise online and screen clients, they are often forced onto the street, where it is more difficult to screen out violent clients and negotiate safe sex (i.e. sex with condoms). They are also more likely to have to depend on exploitative pimps to find customers for them.”

The nuances of this debate were never argued in a legislature or even a court of law. Visa and Mastercard immediately folded in the face of Dart’s letter, and stopped serving Backpage, making it nearly impossible for sex workers (and allegedly traffickers as well) to advertise.

Dart’s open letter resembled Operation Choke Point, in a far flimsier yet more menacing fashion. If Dart had brought a legal action against Backpage, he would have no doubt been trounced in court. The sheriff had already lost a lawsuit against Craigslist in 2009 over their erotic services ads. Although Dart clearly identified himself as the Sheriff of Cook County, he never actually said he was actually going to enforce any law against Visa, Mastercard, or even Backpage. The letter made reference to the federal anti-money-laundering statute and to the alleged existence of sex-trafficking on the website, but it was in essence a missive composed to elicit fear, uncertainty, and doubt. As with Operation Choke Point, it was a request for voluntary action, rather than a criminal complaint, indictment, or injunction.

Perhaps if Visa or Mastercard had put up a fight, Dart would have followed through on his veiled threats, the way the Department of Justice issued subpoenas to errant banks and processors. But because the two companies capitulated instantly, there’s no way of knowing.

In December 2015, a federal appeals court in Illinois granted Backpage an injunction against Dart. The opinion, written by the esteemed Richard Posner, ripped into Dart for trying to “shut down an avenue of expression of ideas and opinions through ‘actual or threatened imposition of government power or sanction’” in violation of the First Amendment.

In court, Visa claimed that “at no point did Visa perceive Sheriff Dart to be threatening Visa,” and that it had simply made a voluntary choice to stop servicing Backpage. But back in June, Dart’s director of communications had sent an email informing Visa that the Sheriff’s office was about to hold a press conference on Backpage and sex trafficking, and that “[o]bviously the tone of the press conference will change considerably if your executives see fit to sever ties with Backpage and its imitators.” Internal emails between Visa employees at the time referred to the Dart press conference email as “blackmail.”

For Judge Posner, Dart’s tactics were troubling. They could be easily replicated, following a formula of “unauthorized, unregulated, foolproof, lawless government coercion ... coupling threats with denunciations of the activity that the official wants stamped out, for the target of the denunciation will be reluctant to acknowledge that he is submitting to threats but will instead ascribe his abandonment of the activity to his having discovered that it offends his moral principles.”

Posner made no mention of it in his opinion, but the same strategy had been repeated years earlier, when Senator Joseph Lieberman had convinced the payment processors to cut off WikiLeaks in the wake of the publication of the State Department diplomatic cables. As with Backpage, and was with Operation Chokepoint, this was a “voluntary” decision on their part. The financial blockade would only be lifted (partially) two years later in 2013.

The Seventh Circuit Backpage decision is an important First Amendment precedent, a much-needed corrective in an age of ever-more-frequent financial blockading. But much of the decision builds its case by pointing to Sherriff Dart’s hamfisted tactics, the obvious coercion that Visa employees called “blackmail” in writing. What happens to a more factually subtle case that lands in front of a less-libertarian-leaning judge?

As paper money evaporates from our pockets and the whole country—even world—becomes enveloped by the cashless society, financial censorship could become pervasive, unbarred by any meaningful legal rights or guarantees.

* * *

In January 2011, shortly after the WikiLeaks financial blockade was put into place, the founder of WePay posted an Ask Me Anything on Reddit, calling his company the “anti-Paypal.” He wrote that he was particularly concerned with how readily PayPal froze accounts that collected money for good causes.

It had only been a month or two since payment processors—including PayPal—had chosen to blockade WikiLeaks. So predictably, one commenter asked a direct question about WikiLeaks.

“Theoretically, you can use WePay to collect money from people in your social circles, and donate that money to whomever you'd like,” he wrote in response. “That being said, we've intentionally tried to keep our heads down and sit on the sidelines for this one. … [W]e pride ourselves on not freezing accounts, but in extreme cases like wikileaks, there is always the chance that authorities will force us to do so.”

Four years later, the company seemed to have decided that a fundraiser for a sex worker’s hospital bills was an extreme case like WikiLeaks.

9863 - INVITATION : Panel Discussion on UID/ Aadhar act 2016 and its impact on Social Security

INVITATION : Panel Discussion on UID/ Aadhar act 2016 and its impact on Social Security

With the passage of the Aadhaar act 2016 is UID / Aadhar mandatory now?  How do we understand the issue of Social Security in the context of the new law?  What does it mean for those who need to access their senior citizen pension, rations, school and college scholarships  etc

How does one understand the money bill route for introducing the bill in Parliament? What are implications of this for the validity of the law? 

What will happen to the court cases challenging the UID now?  

Where are we now on the thorny issues of surveillance, tracking, profiling, biometrics, private and foreign companies and subsidy?  What does the law say?  

This discussion will revisit the debates around the UID and examine the implications of the new law.

Date : 25/4/2016

Time: 2.30-4.30 p.m.

Venue: SCM House (behind Vijayalakshmi Silk House), Mission Road

Speakers : Usha Ramanathan, eminent jurist

Col . Mathew Thomas, Petitioner on UID case

Sunil Abraham, Director -Centre for Internet and Society, Bangalore

9862 - India Still Trying To Turn Optional Aadhaar Identification Number Into A Mandatory National Identity System from the sliding-down-the-slippery-slope-to-disaster dept - Tech Dirt

India Still Trying To Turn Optional Aadhaar Identification Number Into A Mandatory National Identity System

from the sliding-down-the-slippery-slope-to-disaster dept

Last year, we wrote about India's attempt to turn the use of its Aadhaar system, which assigns a unique 12-digit number to all Indian citizens, into a requirement for accessing government schemes. An article in the Hindustan Times shows that the Indian government is still pushing to turn Aadhaar into a mandatory national identity system. A Bill has just been passed by both houses of the country's parliament, which seeks to give statutory backing to the scheme -- in the teeth of opposition from India's Supreme Court:

There have been orders passed by the Supreme Court that prohibit the government from making Aadhaar mandatory for availing government services whereas this Bill seeks to do precisely that, contrary to the government's argument that Aadhaar is voluntary.

The article notes that in some respects, the new Bill brings improvements over a previous version:

It places stringent restrictions on when and how the UID [Unique Identification] Authority (UIDAI) can share the data, noting that biometric information -- fingerprint and iris scans -- will not be shared with anyone. It seeks prior consent for sharing data with third party. These are very welcome provisions.

But it also contains some huge loopholes:

The government will get sweeping power to access the data collected, ostensibly for "efficient, transparent, and targeted delivery of subsidies, benefits and services" as it pleases "in the interests of national security", thus confirming the suspicions that the UID database is a surveillance programme masquerading as a project to aid service delivery.

The fact that an optional national numbering system now seems to be morphing into a way to monitor what people are doing will hardly come as a surprise to Techdirt readers, but this continued slide down the slippery slope is still troubling, as are other aspects of the new legislation. For example, it was introduced as a "Money Bill," which is normally reserved for matters related to taxation, not privacy. That suggests a desire to push it through without real scrutiny. What makes this attempt to give the Aadhaar number a much larger role in Indian society even more dangerous is the possibility that it won't work:

A recent paper in the Economic and Political Weekly by Hans Mathews, a mathematician with the [Centre for Internet and Society], shows the programme would fail to uniquely identify individuals in a country of 1.2 billion.

A mandatory national identity system that can't even uniquely identify people: sounds like a recipe for disaster.

9861 - Public Meeting AADHAAR: Citizens as Database: Claimed ‘Benefits’, Hidden Costs, Real Threats

Public Meeting

AADHAAR: Citizens as Database: Claimed ‘Benefits’, Hidden Costs, Real Threats

Speakers

Usha Ramanathan, noted jurist

Dr Reetika Khera, noted Economist   

Gopal Krishna, Citizens Forum for Civil Liberties (CFCL)

Date: 20^th April, 2016

Venue: Mahi Mandavi Mess, Jawaharlal Nehru University (JNU)

Time: 9.30 PM

9860 - The Technocratic Visions of Nandan Nilekani: What an Aadhaar-Enabled Future May Look Like - The Wire

The Technocratic Visions of Nandan Nilekani: What an Aadhaar-Enabled Future May Look Like

The Aadhaar ecosystem is best thought of as a birthday cake: the cherry, the icing and the cake itself. Credit: Australia India Institute

If there’s one person that’s smiling after last Friday, when the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill was given an overwhelming stamp of approval by the Lok Sabha, it’s Nandan Nilekani.

Although the origins of the UID project can be traced back to the first NDA government, it is mostly due to the efforts of the Infosys co-founder and Congress party member that the Aadhaar initiative was given shape and pushed through the largely dysfunctional second UPA government.

With the national identification project now receiving statutory backing, what lies in store for India’s citizens? What else can it be used for; what feats of technological efficiency can be achieved? Or in other words, what sort of house can be built upon the Aadhaar system?

Fortunately for us, Nilekani’s latest book, Rebooting India, released late last year, comes with a number of examples. Nilekani and his co-author, Viral Shah, think almost exclusively in terms of networks, databases and centralisation; the very same centralisation that many people fear can be exploited without the proper privacy and security safeguards that India currently lacks.

At the beginning of Rebooting India, Nilekani illustrates his argument with a diagram of a “class of applications”, that includes ‘social security schemes, subsidies, government services, e-KYC, voting/administration’. This classification, however, is a little messy. It doesn’t adequately explain how Aadhaar could impact our society, both from a positive and negative perspective.    

It’s far better to think of an Aadhaar card and its application ecosystem as a birthday cake that consists of three parts: the cake, the icing and the cherry on top. All of the examples given below, divided into three categories, are potential use-cases that have been laid out by Nilekani and Shah in their book.

Part 3 – The cherry

The cherry is what the Aadhaar card is capable of in the future. It’s what can be built upon the UID system and is simultaneously exciting and a little frightening.

Voting 2.0: The Death of Fraud:  In early 2015, Chief Election Commissioner H S Brahma announced that the voter ID and Aadhaar number systems would be linked in order to help stamp out voter fraud.

A person with unique biometric data obviously cannot vote twice and as Nilekani and Shah write, “creating a fake voter profile would become so complicated that no would-be election rigger would bother trying.”

This, however, is only the beginning. While the Aadhaar system can obviously be used to speed up our sluggish voter enrolment process, the real advantages come when the voting system becomes electronic. Once our Aadhaar cards allow us to identify ourselves, smartphone applications “can allow every aspect of the voting process – voter registration, address changes, polling booth information, perhaps even casting one’s ballot – to be available to us on our smartphones”.

In the short-term, the government could potentially boost enrolment by algorithmically nudging its citizens once the voter ID and Aadhaar databases are linked ( a suggestion that the book says was made by former CEC N Gopalaswami). Since Aadhaar cards are issued to all Indian residents from birth onwards, the system can “automatically flag those Aadhar card holders who turn 18 in a given year, making them eligible to vote”. Once these potential voters are identified, they can be prompted to start the voter registration process, thus hopefully reducing a barrier for lethargic voters.

The National Health Information Network (NHIN):  Imagine an electronic medical record system (EMRS) used by multiple health service providers. “For example, a pharmacist can pull up a prescription, doctors can pull up diagnostic test results from labs online and insurance companies can provide customised quotes based on prior history,” the authors write in their chapter on ‘Towards a Healthy India’.

As with everything else, the Aadhaar number serves as a basis for this as a “natural patient identifier”. Although the construction of a database will require some level of information sharing, once that is allowed by the user in question, the sky’s the limit. In the same way the government distributes subsidies to Aadhaar-linked bank accounts, health-related payments through government-backed insurance schemes can also be carried out.

Patients can walk to different hospitals with their data and after being identified, their health status follows them everywhere. But again, this is only the start. Nilekani & Shah believe that the Aadhaar-backed EMRS will be a “treasure trove of ‘big data’ that can be mined using analytics to identify public health trends, collect statistical data and detect epidemic outbreaks.”

Education, Exams and Jobs: From the problems of implementing the RTE act to the issue of fake resumes, the Aadhaar system has a possible role to play in the future.

The idea is simple: The RTE Act demands that private schools set aside 25% of their enrolment capacity for students from economically disadvantaged backgrounds. 

Instead of setting aside money only for government schools, some part of that funding that can be used to create ‘school vouchers’ that can be used by needy students to “pay for their education at a school of their choice”. “Aadhaar”, the authors write, “can be used in the creation of a central registry and voucher-issuance platform for schools and students”. “Students can be registered in the system using their Aadhaar numbers.” Once these vouchers are issued, matched against the correct Aadhaar number, parents can enrol their children at a school of their choice.

Changing track a little bit, the Aadhaar card system can also go a long way in cracking down on fake resumes (the authors quote statistics that show that one in five resumes in the IT industry are falsified). Prime Minister Narendra Modi already encourages the “de-materialization” of our educational degrees through his Digital Locker initiative. Once combined with an Aadhaar-based identification, a person’s educational qualifications can be guaranteed, “increasing trust between jobseekers and potential employers”.

Other low-hanging fruit can also be tackled. Entrance examination fraud, the most prominent example of which is the long-running Vyapam scam, can be eliminated to a great extent if students are authenticated using Aadhaar before entering the exam hall.

Part 2 – The icing

If the cherry is what can finally be built upon the Aadhaar number system, the icing is how Aadhaar is being sold by the current and past governments; how it is represented in mainstream debate; how it will eventually be funded.

It is here that there has been the greatest discussion. Nilekani and Shah’s outline here is simple and echoes the Modi government’s logic: Aadhar-backed bank accounts and micro-ATM systems will eventually result in a cashless India. But in the meantime, it can be used to mend India’s social safety nets, fix our leaking subsidy system and bring order to the country’s somewhat chaotic identification system.

A number of legal and academic critics counter the above arguments by pointing out how the Aadhaar can be used as a method of exclusion, how its technology is flawed, and how it could work against the very beneficiaries it should be helping. Citing Edward Snowden’s revelations, they argue mass surveillance will likely result, even if they don’t properly expand on how exactly the Aadhaar database will result in constant surveillance.

Part 1 – The cake

The cake is what the Aadhaar card actually is, when stripped down to its core: An identification number that can be used to identify a person electronically. In popular, mainstream debate this definition is taken for granted and is often overlooked when critics express their worries.

In the opening chapters of the book, the authors state very eloquently the difference between the Aadhaar project and any other system of identification, whether it’s your debit card or driver’s licence.

“To use an ATM to withdraw money you need a debit card (‘what you have’) and  a PIN (‘what you know’). Strong authentication can be provided by the UIDAI the biometrics (‘who you are’) combined with the one-time password sent to the mobile phone (‘what you have’),” they write.

There are two key phrases in the above paragraphs: ‘who you are’ and ‘identifying a person electronically’.

The latter is why the Aadhaar card is so powerful: theoretically, barring any lemon juice or Boroplus mistakes, it allows a system to authenticate your identity electronically in a single attempt. Other methods of electronic identification could require up to two or three different ways of doing so. But because Aadhaar is capable of doing so, it allows you to build upon it a variety of different applications.

On the other hand it is the ‘who you are’ part that concerns critics of the Aadhaar project. If there’s a system that can identify who you are in one step, it only stands to reason that the privacy and security of its users should be protected. It’s not enough that the system itself is secure, but that the legal apparatus around it is also in place. And yet much of the pro-Aadhaar rhetoric ignores this.

For instance, when the Attorney-General argued before the Supreme Court late last year on this issue, he pointed out if the poor wished to continue receiving benefits, they needed to be prepared to surrender their right of privacy.

In other similar arguments, the “oh, but the benefits outweigh the risks” approach also crops up very often. While this appears to be a seemingly pragmatic stance, it ignores the fact that we can have the cake and eat it as well. It’s completely possible to have an identification system that is used to transfer subsidies and a piece of national privacy legislation that protects the rights of India’s citizens. To argue otherwise, or to bring up ‘benefits outweigh the risks’ is to behave like a child; to want something right now simply because you want it.The governments of the last five years had ample time to pass a privacy law. They just never got around to doing it.

§

When we step back and look at the three layers of the Aadhaar cake, there are two different arguments against the project when it comes to issues of privacy and security. The first concerns the Aadhaar project’s database security and privacy: who else will have access to the database, under which conditions, and what will happen in the case of data breaches? 

This is extremely important – but this concern also applies to nearly every other centralised government database of citizen data. It makes more sense to have broad privacy legislation and a specific data regulator address these concerns, rather than have each database come with a specific piece of vaguely-worded legislation (the way Aadhaar has with its Section 33).

The larger argument against Aadhaar has more to do with the cherry and less to do with the icing. The Aadhaar database today is useful for transferring subsidies and other payments  but isn’t as exciting to private companies as the ecosystem that can be built on top of Aadhaar. The examples laid out by Nilekani in his book have started being built albeit in much simpler forms: an Aadhaar hackathon held at Khosla Labs in Bangalore earlier this year saw college students come up with ways to innovate on digital identity using the Aadhaar system.

Scroll reported today (PTI had an earlier piece on the same company last December before the Aadhar system was given statutory backing) on a company that uses a smartphone application and Aadhaar verification to verify the background details of semi-professional workers such as drivers and maids. And yet, there doesn’t seem to be anything too wrong with this because this is exactly how the Aadhaar API is supposed to work!  As YourStory points out, “the basic authentication that they [UID] allow third party apps as of now is to verify an entry in the Aadhaar database by means of querying any of the data points they capture.” Whether the Supreme Court allows this and whether the Aadhaar Bill legitimises these third-party applications, however, is yet another question.

The larger problem, therefore, is the question of government centralisation. The Aadhaar card system is almost techno-deterministic in nature; its existence demands that it be linked to other databases, to constantly extract value from its user data, and to carry out a process of algorithmic regulation in the name of efficiency.  The value of the Aadhaar database, to bureaucrats, policy-makers and politicians lies in how often it can be triangulated with other sources of data.

While this may be valuable to administration and instrumental in mitigating natural disasters, it could also backfire without proper safeguards. For instance: linking the Aadhaar database to the voter ID system could possibly allow governments to nudge new voters into enrolling. But what if this is done only in swing states, in swing constituencies and in areas that favour one political party over the other?

The death of privacy in autocracies allows repressive governments to target their citizens. In democracies like India, however, the lack of privacy legislation is seen by officials, such as our Attorney-General, as a method of providing services and benefits to citizens. This confused and even shocking logic – in which the defenders of the UID system respond not by allaying privacy concerns but by insisting citizens have no privacy rights – seems characteristic of our Aadhaar-enabled future.