12935 - What Aadhaar collects: Fears of a surveillance state are overblown, but a robust privacy bill is needed - TOI

What Aadhaar collects: Fears of a surveillance state are overblown, but a robust privacy bill is needed

March 2, 2018, 2:00 AM IST Srikanth Nadhamuni in TOI Edit Page | Edit Page, India | TOI

Claims, insinuations and even jokes have done the rounds on print and social media about how the Aadhaar system could lead to a surveillance state. There are worries that unsuspecting Aadhaar carrying residents will be closely tracked by the government while they authenticate themselves as they pay for their pizza or buy rice at a ration shop.

We need to understand what data Aadhaar collects and more importantly what it doesn’t, to determine whether the above dystopian scenarios are likely or even possible.

Aadhaar does only two things. First, enrolment, wherein an applicant is processed and issued an Aadhaar number. Second, online authentication where the Aadhaar holder is accurately verified during a transaction such as buying rations.

Back in December 2009, a government appointed committee with representatives from several ministries, regulators and NGOs met to determine which demographic fields should be collected to issue an Aadhaar. After lengthy deliberations, the committee came up with a simple rule – UIDAI should only collect the minimal amount of information in order to protect the privacy of the people. The four mandatory fields were, ‘Name’, ‘Address’, ‘Gender’ and ‘Date-of-birth’. ‘Email’ and ‘mobile number’ were left optional.

Similarly, a government appointed biometric committee decided that ten fingerprints, two irises, and a photo of the face were needed to accurately de-duplicate the entire population and issue a unique ID, thus ensuring that a resident does not get multiple Aadhaar IDs. This was the bane of earlier systems, where programme-based ID cards which lacked uniqueness (one person, one ID) resulted in duplicates and ghost IDs, leading to resource capture, leakage and other fraudulent transactions.

Based on the above demographic and biometric data that is collected, the enrolment system issues an Aadhaar number after a de-duplication process to ensure that the resident is unique and does not already possess an Aadhaar number.

Once the resident is enrolled in the Aadhaar system, she can now authenticate herself at various points to prove her identity. Just as one would enter a user-ID and password to login to one’s email account, the Aadhaar holder can now authenticate herself by entering her Aadhaar-number (user-ID) and one of the demographic/ biometric details (password). This online verification proves to be very useful in a host of services, be it government service delivery, banking/ payments or even renting a bicycle.

Now let’s look at Aadhaar authentication.

During authentication, the user enters the Aadhaar number and one or more of the biometric (fingerprint/ iris) or demographic (name/ address/ gender/ date of birth) fields and Aadhaar returns a Yes/ No response. It does not return other details about the person, hence protecting the privacy of the individual.

The Aadhaar system does not collect the specific purpose of your authentication, or the location of your transaction so there is no way the system can construct where you were and what you were doing. As can be seen in Section 3.3 of the ‘Aadhaar Authentication API Specification’, there is no input field in the data format that collects the location or type of transaction being carried out (example, paying for your pizza or buying rice at a ration shop).

Delving deeper into privacy and accountability, let’s look at the audit trail feature Aadhaar provides so that you can view your Aadhaar transactions and ensure that they were all bonafide – just as you reconcile your bank statements. It can be argued that if the history of Aadhaar transactions contained details such as what (specific transaction type), where (location information) and by whom (authenticating entity), the user would be empowered with context against potential frauds by more accountability in the system. In fact, an earlier version of the Authentication API spec did collect the location information for this very reason. On the contrary, it can also be argued that collecting the where and what and who would compromise the Aadhaar holder’s privacy.

The point i’m making is that a line has to be drawn somewhere between privacy and accountability and you can’t have both independent of each other. A measured, balanced approach between the two is in the interest of citizens and this, i believe, is what Aadhaar offers.

An average smartphone user can be tracked by the telecom provider who can triangulate the user’s location through telecom base stations. Apps from Google, Facebook, Apple and thousands of other companies are also able to track smartphone user location using GPS sensors. Surveys show that over 75% of smartphone users enable location services. This is the reality of the digital world we live in. In contrast, the Aadhaar authentication system is designed to protect people’s privacy by not collecting such information.

India is coming to terms with privacy in this increasingly digital world for the first time. The debate around Aadhaar privacy is a precursor to the larger privacy debate. It is a good thing that people are becoming aware of the issues around privacy.

Aadhaar brings tremendous benefits to our country, be it in plugging the leaky pipes of the government’s benefits delivery, or convenient pension payments. The passing of a robust privacy bill and Aadhaar compliance to it would hopefully help alleviate concerns as we strive to build systems of better service delivery in a data rich and digital India.

DISCLAIMER : Views expressed above are the author's own.

11756 - Aadhaar is fully protected: UIDAI's former tech head - Deccan herald

Aadhaar is fully protected: UIDAI's former tech head

N V Vijayakumar, DH News Service, Bengaluru, 

Aug 12 2017, 23:16 IST

                             Srikant Nandhamuni

Aadhaar system is fully protected and well-designed from any data breach, according to Srikanth Nadhamuni, who was the first technology head of Unique Identification Authority of India (UIDAI), which issues identification numbers to citizens. 

In an interaction with DH, Nadhamuni said Aadhaar system can proactively plug any attempts to steam data. “I firmly rule out any possibility of hacking into the Central Identities Data Repository (CIDR), where the Aadhaar data is saved in the country. It is extremely secure and well-designed system,” Nadhamuni said.

Commenting on the recent attempt by technology professional Abhinav Srivastava to illegally create a public app that could obtain details of Aadhaar holders, Nadhamuni said the National Informatics Centre (NIC) website which is giving AUA (Authentication User Agency) services is not secure.

“NIC, which is giving AUA service provider is outside the purview of Aadhaar, is not complying with its security standards. Instead of Aadhaar’s HTTPS, NIC is hosting their data on HTTP website, application layer protocol designed within the framework of the Internet protocol suite,” he said.

Misinformation

Nadhamuni said it is a misinformation that the hackers got into the CIDR.

“There is no way Aadhaar servers can be hacked. The government and other parties who are using Aadhaar services have to make their systems secure. In this recent case, the person impersonated and acted as a NIC person to directly take data from Aadhaar server,” he said.

The Khosla Lab India head also pointed out that all the entities directly availing Aadhaar services should comply with strict security standards. “We have to further strengthen this security standard so that it is ensured that they are following it,” he said.

UIDAI has appointed 27 KYC Service Agencies to provide authentication services and under them, there are different KYC User Agencies to verify users details.

According to experts, in the recent incident, the accused accessed passwords by hacking E-Hospital - a healthcare delivery platform developed by NIC.

Recently Nandan Nilekani, former head of UIDAI, stated that Aadhaar security was a big concern. The Aadhaar security issue is coming up a time when the Supreme Court is hearing a petition to decide if data privacy is a fundamental right. The Centre made it very clear to the apex court on July 27 that data privacy cannot be a fundamental right as it has many facets.

To give further momentum on data privacy, the government on August 1 formed an expert committee to deliberate on data protection laws, which will also come up with a draft data protection Bill.

10765 - Aadhaar shows India's governance is susceptible to poorly tested ideas pushed by powerful people - Scroll.In

Aadhaar shows India's governance is susceptible to poorly tested ideas pushed by powerful people

A short history of India's Unique Identity project.

Image credit:  Anumeha Yadav

Dec 27, 2016 · 09:00 am  

M Rajshekhar

This series has flagged a puzzling trend. State governments are struggling to use Aadhaar-based fingerprint authentication in ration shops. At the same time, a rising number of companies are integrating Aadhaar into their databases.

This is puzzling because from its inception, Aadhaar, India’s Unique Identification project, was pitched as integral to the modernisation of social welfare delivery in India.

Why is it failing at the job it was created for while proving useful elsewhere?

The answers vary depending on whom you ask. Former officials of the Unique Identification Authority of India, the government agency which issues Aadhaar numbers and manages the database, blame state governments and banks for poor execution of Aadhaar-based welfare delivery. State governments in turn blame banks and poor internet connectivity and the failures of biometrics-based technology.

These are – at best – incomplete explanations.

The roots of Aadhaar’s mission drift lie deeper.

In hindsight, it is easy to spot the critical moments which resulted in the paradox this article starts with.

The project’s origins

India’s desire to assign numbers to people had two beginnings.

The first, dating back to 2003, emerged from a security mindset.

“The Kargil war had just ended,” recounted a former official in the Unique Identification Authority of India in a conversation in 2014. “The BJP was in power and – partly due to Kargil, partly due to its worldview – it wanted every citizen to have a citizenship card.”

The official, who spoke on the condition of anonymity, said the idea was to start by identifying all residents – which eventually took the shape of the National Population Register – and then, identify citizens amongst the residents.

The second push for an identity project came in late 2008. The first term of the Congress-led United Progressive Alliance government was about to end. Welfare spending was rising. Bureaucrats in the erstwhile Planning Commission were worried about leakages.

According to a senior official in the Registrar General’s office, which was working on the National Population Register, an idea emerged of constituting an authority that would aggregate all databases of social welfare programmes to create a mother database.

Such a database would “weed out ghosts and duplicates so that a person who gets the LPG subsidy doesn’t also get the kerosene subsidy,” explained the former official of the Unique Identification Authority of India. The bureaucrats wanted a mechanism for “deduplication”. They felt some people had enrolled multiple times in the government’s welfare programmes – for instance, by changing the spelling of their name or their address. The government was seeking a way to remove these duplicates.

According to the former official of the Unique Identification Authority of India, the proposal drawn up by senior Planning Commission officials envisaged a massive organisation the size of the home ministry. It was expected to have 36 joint secretaries. The design would be similar to that of the Election Commission with one joint secretary in every state and others coordinating with the central government. “The secretary of the Planning Commission, who was retiring soon, was tipped to head the new body,” he added.

This proposal, said the official, went to the Union Cabinet in February 2009.

At this stage, there was no talk of biometrics.

Enter Nilekani

That plan changed once software entrepreneur Nandan Nilekani came on board.

According to a former cabinet minister in the government, around May 2009, when the Lok Sabha results were expected, Congress dynast Rahul Gandhi asked Nilekani to join as the Human Resources Development minister.

That offer fell through – he was seen as too controversial a choice.

Prime Minister Manmohan Singh then asked Nilekani if any other role in the government interested him. He picked the job of the first chairperson of the Unique Identification Authority of India.

A set of initial conversations followed between Nilekani and other technology entrepreneurs like Shrikant Nadhamuni, who had worked at firms like WebMD and Silicon Graphics. The fledgeling team decided to junk the idea proposed by the Planning Commission, calling it impractical. Taking details from the voter database and matching them against another database was “not implementable at all,” said the former official of the Unique Identification Authority of India. “How do you do it? Hundred guys have the same name.”

The team felt the only way forward was deduplication through biometrics.

It was a leap of faith. Biometrics had been used in other countries but on a much smaller scale. “We spoke to techies and top computer guys and they said ‘Yeah, it has never been done before but we think it is doable,’” said the former official.

The early conceptualisation

At this time, while working on the proposal they would take to the cabinet, the team made two other bets.

One, it decided to create an authentication system for Aadhaar – so that the number could also be used to establish that a person was who he or she claimed to be. Explaining this decision, the official said: “If something is not very useful, it will not get used. Like the voter identity card which just sits on a shelf.” Instead, Nilekani and his techies wanted something “embedded in everyone’s life”.

Two, the team focused on making the project useful for financial inclusion by building Aadhaar-based payment mechanisms – Aadhaar Payment Bridge and Aadhaar Enabled Payment System. The Payment Bridge was a list of beneficiaries’ Aadhaar numbers and the primary bank account into which their welfare entitlements would flow. Since biometrics would ensure that no person had more than one Aadhaar number, the Payment Bridge would help remove duplicates.

The Aadhaar Enabled Payment System, on the other hand, was meant to verify the beneficiary. At the time of collecting payments, for instance, a NREGA worker would have to submit his fingerprint and Aadhaar number. The team conceptualised a system where this information would be sent to the Authority’s server asking it to verify if these fingerprints and the number matched.

This focus on financial inclusion, said Pramod Varma, a former Infosys employee who returned from the United States to join Aadhaar as its Chief Technology Architect, in a conversation in October this year, was one way to ensure government support for the project would stay high.

“We needed to find a need which is very desperate,” he said. “That is important for a product to succeed. This proposition helps build support for the programme.”

That said, the team did not want Aadhaar to be used only for government programmes. In a conversation in October this year, Nilekani said: “Government schemes work if you universalise them. When upper class Indians leave a system, it weakens. When they stopped sending their children to government schools, they became a disaster.”

For this reason, he said, “If we used Aadhaar only for PDS [public distribution system of food rations], then there would be no pressure to keep it working fine. Increasing the number of people using Aadhaar is a way to keep the system honest. Because the underlying architecture is the same.”

The team decided to create an API-based architecture. API stands for Application Programme Interface, which allows institutions to open up their technology for others to use. An API-based system for Aadhaar would let even private companies post authentication queries, widening the uses of Aadhaar beyond welfare delivery.

Said Nilekani, “The more the use of Aadhaar, the less likely the project is to be repealed.”

The underlying assumptions

Two things are notable in the way the team worked.

First, the technological ambition.

“We were not here to do one more IT project,” explained Varma. “Instead, if we could create digital identity as a usable instrument, then we could create something very exciting.”

But it is not clear if that vaunting technological ambition was needed to meet the more mundane requirements of the government.

The other notable feature in the way the team worked was its disdain for the government as something that is fickle, loses interest and lets projects go to seed. Determined that their creation would not meet a similar end, the team had created a model that would let private companies use Aadhaar.

With that, however, the project entered fraught waters. “People had given their biometrics for a particular reason,” said IIM Bangalore professor MS Sriram. “They were told Aadhaar was needed to access welfare delivery.” Can this information be used, he asked, by companies offering products and services?

These questions escaped close scrutiny by the government. This blueprint, presented to the cabinet in August 2009, was approved. Enthralled by technology, and desperate for a solution to a long-festering administrative problem – leaky welfare delivery mechanisms – the government fell back on technology that was untested.

“Somewhere along the way, a lot of people got convinced that this is a good idea without actually understanding why,” said Abhijit Sen, a former member of the erstwhile Planning Commission.

Aadhaar and Cash transfers

What strengthened the project further was the government’s push for cash transfers.

In 2011, then Finance Minister Pranab Mukherjee announced that India would replace the existing subsidy model for fertilisers, kerosene and Liquid Petroleum Gas with cash transfers, officially called Direct Benefit Transfers.

Nilekani was appointed as the head of the DBT committees. He proposed that Aadhaar be used to authenticate the beneficiaries and payments were made to banks through the Aadhaar Payment Bridge.

But it was untested whether Aadhaar-based welfare delivery was superior to India’s existing welfare delivery mechanisms. Although these mechanisms were far from perfect, as Sen, the former planning commission member said, they had “working protocols and well-defined standards”. Not to mention grievance redressal mechanisms which the poor were familiar with. Before replacing the existing systems, it needed to be proved that the new model was superior. Those studies were not done. “There was no independent evaluation,” said Sen.

Both Nilekani and the UPA were in a hurry, Sen added. Nilekani knew that unless the identity project got a big push, it would die. His approach, as Sen summarised was: “All other issues we can look at later.”

A big source of resistance within the government was P Chidambaram, the Home Minister, who raised questions over Aadhaar’s conflict with the National Population Register, a project that his ministry was implementing. Most people suspected this was an extension of Chidambaram’s turf war with the Finance Minister Mukherjee.

But the Congress had its own compulsions. It felt a mounting panic as the 2014 elections neared. Unlike its first term when it had passed the National Rural Employment Guarantee Act, the Right To Information Act and the Forest Rights Act, its second term had little to show. The party pinned its hopes on cash transfers to reduce leakages and to blunt the corruption tag haunting the party.

But the pilot projects using Aadhaar for cash transfers in fertiliser and kerosene were not successful. Another pilot involving NREGA payments in Jharkhand failed to scale up as well. The reasons ranged from poor connectivity, fingerprint failure to more social ones like caste, gender and political favouritism. Despite that, the government decided to roll out Direct Benefit Transfers in 43 districts.

In December 2012, this reporter sent a questionnaire to then rural development minister Jairam Ramesh asking about the parameters the government had identified for gauging success or failure of Aadhaar-based DBT. His response, on email, was: “Your questions are for a doctoral thesis and answers can only be provided as we go along.” It was a confounding answer – as far from evidence-based policy making as one can imagine.

Much of this was adventurism, said Sen. Aadhaar-based cash transfers were “costlier and more ambitious than thought earlier”. But the Congress pressed ahead. “It was a political party decision”, he said, not a government decision on how to deliver welfare.

Things came to a head in Rajasthan. Desperate for a magic bullet for the impending state elections, the Congress state government announced that soon only those with Aadhaar cards would be able to access state welfare programmes in Rajasthan. As things turned out, the Congress lost the elections. After that, the party began pulling back.

A new government

In 2014, the Bharatiya Janata Party came to power at the Centre with Narendra Modi as prime minister. For a while, it was unclear where Aadhaar was headed. During the campaign, the party’s leaders had repeatedly pointed at flaws in the project and promised to shutter it.

The Unique Identification Authority reported to the Planning Commission, “which itself was looking shaky under the new government,” said the former official. The home ministry, now headed by Rajnath Singh, tried to get the Authority transferred to it.

In response, in the first week of July, Nilekani, whose term at the Authority had ended, met Finance Minister Arun Jaitley and Prime Minister Narendra Modi. Four days after that meeting, Modi made his first public statement backing Aadhaar. Five days later, Jaitley, in his Union Budget, increased allocation for the Unique Identification Authority of India from Rs 1,550 crore to Rs 2,039 crore. The push on Direct Benefit Transfers was revived as well.

Since then, Aadhaar’s uses within and outside the government have multiplied. Other patterns like an indifference to field realities persist. With the design of the Application Programme Interfaces being led by non governmental organisations like iSpirt, there has been little open discussion about their design, possible downsides, or usability in a country where a large part of the country is not digitally literate.

Aadhaar and India’s system of governance

India’s experience with Aadhaar raises large questions about the Indian state’s capacity to execute a large, complex project.

The project escaped close examination within the government. Much rode on the reputation of Nilekani, who leveraged his reputation to meet chief ministers, bank officials and others, and build acceptance for Aadhaar.

The former official of the Unique Identification Authority of India categorises this as India’s “weak system” problem. “Only people with great social capital can navigate this (system) and make some headway.” In other words, a Joint Secretary with a good idea might not be able to see it to fruition. But a bad idea, driven by powerful people, will go through.

As Aadhaar became deeply entrenched in the government, fundamental questions on whether the technology works, the consequences of tagging a unique number to everyone, and the privacy issues that come with it, found little discussion – and continue to get little discussion even now.

This is the sixth part in a series on the expansion of Aadhaar and the concerns around it. Read the other parts here.

9817 - India's Audacious Plan to Bring Digital Banking to 1.2 Billion People - Bloomberg

India's Audacious Plan to Bring Digital Banking to 1.2 Billion People

A biometrics-backed ID system will make it easier for everyone—from rural villagers to urban dwellers—to ditch cash.

Saritha Rai

April 11, 2016 — 8:00 AM AEST

India is trying to yank its cash-based economy into the 21st century.

But how do you get 1.2 billion people, many of whom have never seen a bank or opened an account, to send digital payments to each other? 

India's Digital Banking Plan

The government's answer is an effort it has named the Unified Payment Interface. Debuting Monday, it's a system designed to make transferring and receiving money as easy as exchanging e-mail or text messages.

The goal is to bring banking and financial services to hundreds of millions of citizens, many of them poor and disadvantaged, in one fell swoop. The network was created by India's retail banks and backed by India's central bank—and they're confident it will work because it's built on top of an even more audacious project: India's biometrics-enabled national ID system, called Aadhaar after the Hindi word for foundation.

So far, India's attempt to assign every citizen a unique 12-digit number associated with a person's unique iris, fingerprint or facial features, is succeeding—just last week, Aadhaar reached its milestone of registering 1 billion people. With more than 80 percent of Indians enrolled, it gives the payments system a solid base to build on.

"The interface will bring banking to the unbanked," said Vinod Khosla, billionaire investor and co-founder of Sun Microsystems. His Bangalore-based incubator Khosla Labs is backing an Indian startup called Novopay, which offers mobile banking at 44,000 kiranas, or neighborhood convenience stores, in the country.

Vinod Khosla. Photographer: Kim White/Bloomberg

More than 233 million Indians have never been to a bank, and most accounts have a balance of zero, according to PricewaterhouseCoopers. And even though India has the world's second-biggest population, there are only about 23 million credit cards in the country, according to the Reserve Bank of India.

India is hoping to replicate the success of a similar digital-payments scheme in Kenya. Introduced in 2007, Safaricom's M-PESA system lets people send and receive money via mobile phones. What's impressive is the sheer number of people doing so: 22 million, or half the African country's population. India's system is designed to work at a more basic level, with payments flowing between mobile, banking and other networks. 

That also means mobile banking's growth potential is huge. India has the world’s fastest-growing smartphone market, which is projected to double in a few years from the current 220 million users. Soon, all it will take in India to send money is a phone number, an Aadhaar number or a simple virtual-payments address.

"The robust system will help India leapfrog the desktop and the credit-card economy to become a mobile-first economy, accelerating e-commerce and driving a host of financial services," said Nandan Nilekani, who led the push to introduce Aadhaar and has been advising banks on the rollout of the new payments network.

The main challenge will be cost. In order for India's new digital payments system to succeed, transaction fees will have to be set very low in a country where the average monthly wage is about $300. While the network's backers say costs will come down, detractors said the banks will have to keep fees affordable. Success will depend on the combination of banks, startups, user experience and digital literacy, said Akanksha Sharma, senior analyst at research firm GSMA Intelligence.

Srikanth Nadhamuni, chief executive officer of Khosla Labs, said the best way to think of the project is by comparing it to how shampoo was introduced in India. Decades ago, most people couldn't afford to buy an entire bottle of shampoo, so Unilever, Procter & Gamble and other companies sold them in small sachets that people could afford to buy, paving the way for marketing everything from detergent to toothpaste in rural areas. Nadhamuni is betting that the new digital payments system will be be low-cost, high-volume, like a "shampoo-sachet revolution in the financial sector."

Flipkart, India's biggest online retailer, is getting in on the action. The e-commerce leader recently bought PhonePe, which is building a mobile application based on the Unified Payments Interface. The app will let Web shoppers pay for goods, daily wage workers manage bills and help migrant workers send money home—with just a phone number.

"UPI has the potential of transforming the entire payments ecosystem in the country," said Binny Bansal, Flipkart's co-founder.

9562 - A UID Numbering Scheme by Srikanth Nadhamuni

A UID Numbering Scheme
Hemanta Kanakia, Srikanth Nadhamuni and Sanjay Sarma
May 2010

http://indiagovernance.gov.in/files/A_UID_Numbering_Scheme.pdf

A UID Numbering Scheme

9215 - FinTech firms say RBI's competition to build tech innovations will disrupt industry - Business Standard

FinTech firms say RBI's competition to build tech innovations will disrupt industry

The move is being welcomed by startups and experts who see it as a way for startups and specialised financial technology firms to be recognised

Alnoor Peermohamed  |  Bengaluru 

December 24, 2015 Last Updated at 19:04 IST

The Reserve Bank of India (RBI) has launched a contest to find innovative technology solutions to prevent financial fraud, reduce cost of transactions and develop e-payment infrastructure in India. The move is being welcomed by startups and experts who see it as a way for startups and specialised financial technology firms to be recognised and included in the growing FinTech wave.

The contest, which will be organised by the Institute for Development and Research in Banking Technology (IDRBT), the technology arm of the RBI, will allow for participation of individuals, groups and startups in the space.

"I think it's a very good idea to do that. The central bank and regulator when they show interest in innovation in the FinTech space, it sends the right message that they want innovative solutions in financial services and banking and that's a very good message to send out to companies," Srikanth Nadhamuni, chairman of Novopay, a mobile payment firm that uses Aadhaar for paperless authentication.

India's banking system is undergoing a transformation due to government's focus to bring into fold the unbanked masses using mobile phones and Aadhaar, the unique identification programme for authenticating transactions. Since its launch, banks have enrolled 196 million people with zero balance accounts under the Jan Dhan Yojana. Infosys co-founder and former UIDAI chairman Nandan Nilekani has said that a "WhatsApp moment" is coming in India's banking sector due to the massive use of mobile and policies by the government. RBI has issued new licenses to 10 small banks and 11 payment banks that would use technology to disrupt banking.

While there are certain popular areas of innovation the RBI highlights, it is keeping the competition open to entrepreneurs building financial tech solutions for end-users, banks, payment service providers and other financial sector participants.

"The Reserve Bank acknowledges the role of innovations in developing a payment system which is affordable, interoperable, inclusive and secure," said the regulator in a statement.

Rajeev Yadav, Group CEO of Fincare, a company that recently received its small finance bank license, deems the move as a phenomenal one. "When we see RBI today, through various actions it's taking, through differentiated bank licenses and other things, it's clearly in the frame of helping financial innovation happen, albeit regulated, but with a very clear line of sight," he added.

Startups and others taking part in the contest will not only be rewarded with citations and a small cash prize, but will also be given a chance to pitch their ideas to industry representatives. The entries for the contest will be evaluated by a panel of financial experts.

"There is a lot of innovation opportunities in the financial, banking space at a technology level, at a business model level and I think it's very clear in India that everybody recognises that only technology can help scale these services," said Sanjay Swamy, partner at venture firm AngelPrime.

Nadhamuni of Novopay says that the move would encourage smaller firms to innovate and disrupt the fintech space. "It also encourages small companies to take part in that sector. Often there are large companies and large banks or established companies that innovate, but when they do something like this, it encourages small companies to participate," he said.

8706 - Government's startup funds a bad idea, says Vinod Khosla - Economic Times

Government's startup funds a bad idea, says Vinod Khosla

By PTI | 16 Sep, 2015, 11.11PM IST

BENGALURU: The startup funds announced by the government is "a bad idea" as it would minimise competition, co-founder of Sun Microsystems and Chairman Khosla Ventures Vinod Khosla said today 

"It is a bad idea. I am not a big fan of government establishing venture funds - or government investing. I think that will minimise competition," he told PTI here on the margins of the launch of Novopay, a consumer app and wallet developed by city-based Novopay Solutions. 

The government should do foundational stuff like implementing Aadhaar and build infrastructure for providing telecom services and things like that, Khosla said. 

"Government should do foundational stuff like aadhaar, which no company can do. In the telecom sector, the government can do spectraBSE -1.77 % margin, which nobody else can do," he said, adding, "But individual telecom service - that part companies do very well." 

The government should not establish venture funds when the private companies were able to raise funds on their own, Khosla said. 

"Whenever some things can be done by private companies, the government should maximise competition by not doing it itself," he added. 

On the Prime Minister's most popular slogan "Make In India", Khosla said "Making things in general is a good idea in the country." 

He further said "he believes digital India is a fundamentally an important concept because it will reduce friction and increase the ability to start new startup companies." 

Earlier, Khosla unveiled the Novopay consumer App and Wallet which promises to revolutionise mobile payments in India, be it at the neighbourhood shop, or to pay bills or pay friends online. 

Novopay Chairman Srikanth Nadhamuni said "with this user-friendly App, consumers will also be able to pay conveniently for home deliveries, send money to family and friends, buy mobile and DTH recharges, pay mobile and other utility bills and purchase goods online." 

Novopay CEO Sridhar Rao said the app has over 12,000 retail points across the country from where it already offers banking and money transfer services to walk-in customers since April 2014 in partnership with Bank of India, Axis BankBSE 4.94 % and RBL Bank. 

Read more at:

http://economictimes.indiatimes.com/articleshow/48991763.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

8587 - Lunch with BS: Nandan & Rohini Nilekani - Business Standard

Lunch with BS: Nandan & Rohini Nilekani

United by a mission

Rahul Jacob 

August 21, 2015 Last Updated at 22:46 IST

Nandan & Rohini Nilekani

Our order for lunch is being taken at Bengaluru's inventive Caperberry restaurant when we are all baffled by a word that would likely not be allowed in a game of Scrabble. The manager has asked Rohini Nilekani if she would like to order a starter called 'Spherification'. We all want to know what it is. Nandan Nilekani asks the manager to repeat the order because he knows I need to write it down. Still, 'Spherification' remains mostly a puzzle till it arrives in the form of small round ice lollies of gol guppa pani and mango that a child might make. 

Chef Abhijit Saha is one of the most gifted in India, but occasionally his take on molecular gastronomy tips over into comedy.

Orders out of the way, I ask the Nilekanis how their innovative idea came about of trying to improve learning outcomes across India using interactive computer games and software to teach children via smartphones. 

Rohini's involvement in primary education goes back 25 years. In 1999, she joined the Akshara Foundation, started by the Karnataka government, which set up preschools in slums. Soon after, in partnership with Pratham Books, she began to work towards making children's books more easily available by massively subsidising them with personal donations and by putting them on the creative commons so they could be downloaded without copyright restrictions. Going beyond the attempt to ensure there were children's books in regional Indian languages, people translated the books into Japanese and Chinese. 

Rohini laughs as she recalls how Pratham Books even used the railways to reach children travelling in summer. I recall spending a day with her in balwaadis and government schools in a poor Muslim neighbourhood of Bengaluru a decade ago. Her energy was infectious as she checked on the libraries in schools, stopping occasionally along the way to sit on the floors of a balwaadi in a slum and read to children. Nandan interjects to say that Rohini also funded the first two nationwide surveys by Pratham that showed how poorly children were learning in government schools across India, findings that broadly remain true to this day with about half the children in class 5 unable to do the arithmetic sums that a class 2 student should be able to tackle. "It's a national tragedy," says Rohini emphatically.

Then, as if passing the baton in a relay, she says, "Nandan will take over." He, fast-forwarding to their current effort to turn those depressing statistics around, recounts that when they were in Harvard for their son-in-law's graduation last year, they went across to Massachusetts Institute of Technology to learn about the massive open online courses called edX led by a friend that are offered free. edX teaches, in Nandan's words, "high funda stuff" like calculus and trigonometry. Rohini, he says, thought the same concept could be put to work in helping children between five and 10 with an interactive online tutor to learn basic math and reading. "Nandan doesn't do small things," Rohini says. "When I said 200 million kids, it got his attention." 

Nandan's explanation is more prosaic. Having suffered a bruising election loss to the veteran Bharatiya Janata Party politician Ananth Kumar in south Bengaluru in the summer of 2014, he needed work. "I was basically unemployed. I wanted to do something with a social impact," he says.

EkStep sits at the confluence of many converging trends: the dropping prices of smartphones (which, according to many projections, will be owned by 500 million Indians by 2020), the growth of mobile internet and the ability to store almost infinite amounts of information thanks to cloud computing. Switching seamlessly between technology and education, Nandan says, "The internet has squared the circle of scale and personalisation." I once jokingly described Nandan as a corporate Maharishi Mahesh Yogi for the likes of Tom Friedman, but at lunch I am reminded that few people explain technology and its intersection with society and government better - the subject of his next book, Rebooting Government (co-authored with Viral Shah). 

Nandan goes on to say that the data analytics used by Amazon and Flipkart for commercial uses can also be used to "mass customise" education for a child struggling with division and falling further behind his peers by assessing his level and tailoring lessons accordingly, which is much harder to do in large classes. Using what Aadhaar has accomplished by massively reducing the losses in providing cooking gas to households - savings estimated to be US15,000 crore - as an analogy, he says: "The same disruptive tools apply to solving social issues. Business as usual will not solve India's problems."

I remark at how taken I was to see Aadhaar being used as the backbone for a financial inclusion effort spearheaded by Khosla Labs' Srikant Nadhamuni that I witnessed on a previous trip to Bengaluru. Looking at a large screen, one could see where a kirana store owner armed with only a smartphone had opened a bank account for a construction worker just with his Aadhaar details the night before at well past 10. This is, of course, a subject close to Nandan's heart. "The key is to think of it as a platform," he says rattling off how he it can be used for authentication and biometric attendance as the government is doing, but also as a 'know your customer' for banks without all the documents they usually insist on and, even for e-signatures. 

He is on a roll by now and is even confident it could prevent future Vyapam scams because the Aadhaar platform could be used for digital lockers where a university could issue digital graduation certificates and a job applicant could simply access it from such a locker. "Unless you have a fake university," interrupts Rohini. We laugh at that perfectly plausible prospect in India.

Our main courses have been eaten by now - a stunning salmon for me and a John Dory for Nandan, while Rohini, a vegetarian, has a pear and asparagus salad. At some point, I realise I have been helping myself to her appetisers that were placed too close to me. 

When they split a pomegranate juice - "1X2," says Rohini - I begin to worry that they are under-ordering knowing that the rules are that Business Standard pays. 

I ask them what they see as the hurdles to EkStep. Both are pessi-optimistic in their reply. "There are lots of hurdles. It's massively ambitious. We have to have a diversity of content (in different languages). We have to make it engaging for each child," she says. "There is a scepticism about using technology in education." Nandan talks about the sophistication needed in the technology. I wonder whether mobile internet speeds on India's clogged digital highway and a population mostly using prepaid mobile accounts is ready for such a leap. 

Ever optimistic, Nandan is confident Wi-fi will be more easily accessible and that competition from Reliance Jio will drive costs down. Rohini turns reflective and returns to the challenge of making engaging content in the pilot tests they are currently conducting in English, Kannada and Hindi. "If I can see 1,000 kids learning (from the software and online lessons), I have no doubt that Nandan and his team will take it from there," she says before her voice trails off. "If the kids get stuck…"

The Nilekanis have tapped a global network with experts from the World Bank, educationists from the US and EkStep chief executive Shankar Maruwada, a tech entrepreneur, advising them. The Nilekanis have donated $10 million to get it going, but trying to help tutor 200 million children is the most ambitious gamble of their lives and both know it. "We are ways away from nailing it, but because it is a societal mission, people will help," says Rohini. It may be India's last chance at creating a genuine demographic dividend.

7195 - Codes fly thick and fast in first Aadhaar Hackathon - Economic Times

Codes fly thick and fast in first Aadhaar Hackathon

ET Bureau Jan 12, 2015, 04.03AM IST

BENGALURU: A slew of initiatives, including financial support to Aadhaar-based companies, were announced at country's first hackathon, dedicated to innovating on the Aadhaar platform. The 24-hour marathon coding competition, conducted by incubator Khosla Labs and Nasscom, also announced an appstore dedicated to such applications, to be launched by the end of this month.

Aadhaar is a 12-digit individual identification number issued by the Unique Identification Authority of India on behalf of the Government of India. This number will serve as a proof of identity and address, anywhere in India. "There can be very interesting use cases that come out of such initiatives," said Vijay Madan, director general and mission director, Aadhaar, UIDAI, adding that there will be more hackathons across different cities. Nasscom also announced that its warehouse will have an Aadhaarbased lab going forward. United Seed Fund has set aside Rs 5 crore in 2015 to fund companies focusing on innovating on the Aadhaar platform.

About 140 participants across India showed up for the event. Entrepreneurs and working professionals alike were looking at applications like cashless-payment for retailers using Aadhaar in tier-II cities, one-stop Aadhaar authenticated app for all retrieving one's documents from different government agencies and more. Each team, consisting of 2-3 members were given fingerprint and iris scanner to simulate their app.

The winners will get a one-on-one with Vinod Khosla, founder of Sun Microsystems, a fingerprint scanner and about 3-6 months of coworking space inside Khosla Labs. To recover the operational cost involved in running the Adhaar project, talks are on to charge 5 paise per Aadhaar-based authentication.

Additionally, all major taxi-hailing companies are keen to use authentication for onboarding drivers on its platform, said CEO Srikanth Nadhamuni, Khosla Labs. "For a digital India, you need a digital identity. We now have the technology, the critical mass of enrollments, and the right political support, to carry such hackathons forward," said Ravi Gururaj, member of Nasscom Product & Executive Council.

7192 - Cab cos look to tap Aadhaar for safety - TNN

Cab cos look to tap Aadhaar for safety

TNN | Jan 11, 2015, 01.22AM IST

BENGALURU: Cab aggregators are looking at plugging into the Aadhaar platform to verify driver credentials to make their services safer. 

"All the leading cab operators have reached out to us," said Srikanth Nadhamuni, CEO and co-founder of Khosla Labs, which provides solutions for Aadhaar-based biometric verification. Nadhamuni was head of technology at UIDAI, the government body that manages Aadhaar. 

Speaking at a hackathon organized by Khosla Labs and Nasscom to develop Aadhaar apps Nadhamuni said Khosla Labs had proposed a workflow to cab companies to conduct biometric authentication. "We have told them they should first get the driver's address, photo and date of birth from Aadhaar and then plug it into their database. Now it's clean data, and they know who this guy is." 

Meru Cabs has partnered with Khosla Labs to deploy an app that's integrated with a fingerprint scanner and an iris scanner that connects to the Aadhaar database. This can be used to verify a driver's details. 

5932 - Khosla Labs, AngelPrime to hold Aadhaar hackathons - TNN

Khosla Labs, AngelPrime to hold Aadhaar hackathons

TNN | Oct 31, 2014, 05.38AM IST

Khosla Labs and AngelPrime will be hosting the first two legs of an Aadhaar hackathon to encourage startups to develop an app economy around it.

BANGALORE: With Prime Minister Narendra Modi backing Aadhaar, it has regenerated interest among developers to build apps using the platform. Khosla Labs and AngelPrime will be hosting the first two legs of an Aadhaar hackathon to encourage startups to develop an app economy around it.

"We will teach people to integrate with Aadhaar and they should then be able to build an app over the next 24 hours. We haven't defined the problem statement and have kept it sector-agnostic," said Srikanth Nadhamuni, CEO of Khosla Labs. 

Khosla Labs was set up by Vinod Khosla and Nadhamuni in 2012 as an innovation lab to focus on solving large-scale problems. The lab will shortlist 50 ideas. The second leg of the hackathon would be hosted by Bangalore-based seed fund and incubator AngelPrime that's run by serial entrepreneurs Sanjay Swamy, Bala Parthasarathy and Sripati Acharya.

"We will conduct the hackathon in the next quarter. The idea is to explore the diversity in application development. I would like developers to build apps around school attendance registry for teachers, around healthcare and the financial sector," Swamy said.

Last year, IT industry body Nasscom and the Unique Identification Authority of India (UIDAI) came together to launch what they call the 'Aadhaar ecosystem diffusion project' to encourage startups to develop an app economy around the Aadhaar platform. Using Aadhaar's cloud-based technology would make delivery of services scalable and effective.

Nandan Nilekani, who spearheaded the Aadhaar project, has noted in the past that when the US government launched global positioning system (GPS) in the 1990s, it was only for military purposes, but in the 2000s it was made available for commercial purposes and today the GPS economy has become a half-a-billion dollar economy. A similar phenomenon is expected with Aadhaar. UIDAI has enrolled 700 million people under Aadhaar so far.

5929 - Aadhaar application development new craze among software product start-ups - Business Standard

Aadhaar application development new craze among software product start-ups

Khosla Labs, AngelPrime to hold hack-a-thons for Aadhaar application development

Itika Sharma Punit  |  Bangalore  October 30, 2014 Last Updated at 19:44 IST

With the Narendra Modi-led NDA government showing support for the continuing of Unique Identification Authority of India (Aadhaar) project, several stakeholders in the Indian software product ecosystem have come forward to encourage developers to building Aadhaar-enabled applications.

Among others, information technology (IT) industry body Nasscom, and startup incubators Khosla Labs and AngelPrime have decided to hold hack-a-thons where engineers would be required to write codes using Aadhaar's open-source application programming interface (API).

The first such hack-a-thon would happen on December 6, 2014, at Khosla Labs, which has been founded by serial entrepreneur and investor Vinod Khosla. Interestingly, the Bangalore-based Khosla Labs is currently headed by Srikanth Nadhamuni, who was the brain behind the technology at UIDAI.

Around 50 engineers will be allowed to participate in the hack-a-thon.

The next such hack-a-thon would be held at AngelPrime, which was set up by Sanjay Swamy, Shripati Acharya and Bala Parthasarthy, who were earlier working on the Aadhaar project under the leadership of Nandan Nilekani.

Nasscom would be a co-sponsor for both these event, and will also look at organising more such hack-a-thons.

Since its inception 2009, Aadhaar has been mandated as the proof of identity and address for myriad by the government for various services such as obtaining new passports, mobile numbers, opening bank accounts etc. In the private sector, several companies are using Aadhaar's biometrics for their attendance system.

The online authentication platform built by UIDAI is also being used by both the government as well as private sector. Through its direct benefits transfer project, the government is using Aadhaar to authenticate the correct beneficiaries and eliminate fakes and duplicates from the system.

In the private sector, banks and other agencies which have linked to UIDAI are using it to authenticate transactions as well as users.

The electronic KYC which is a paperless model of verifying the identity of a user is expected to save banks and telecom companies significant cost in keeping and checking physical copies of documents submitted by the consumers. Currently, UIDAI's online authentication services are free. The authority has enrolled 700 million residents of the country out of its total mandate of covering one billion by next year.

5458 - Controversy surrounds India’s biometric database - X Index

http://www.indexoncensorship.org/2014/04/controversy-surrounds-indias-biometric-database/

Controversy surrounds India’s biometric database

Questions about the security of India's giant biometric database continue to be raised by privacy advocates

By Mahima Kaul / 11 April, 2014

(Image: Sergey Nivens/Shutterstock)

Established in 2009 by executive order, the Unique Identification Number Authority of India (UIDAI) has taken on the monumental challenge of issuing each resident of the country with a Unique Identification Number (UID), more commonly known as the Aadhaar card. The driving idea behind the card was to ensure that residents could have a singular identification card that can eliminate duplicate and fake identities and also can be verified in a cost effective manner. Biometrics are the primary method for identification, while other details such as addresses, family, and even bank accounts are linked to the card.

Recently, the UIDAI was in the news as it challenged an order by the Goa High Court to share biometric details of all enrolled Goa residents with India’s Central Bureau of Investigation in order to solve an investigation. The Supreme Court of India ruled that UIDAI did not need to share its data with any agency of the government without the consent of those in its database. In his blog, the former Chairman of UIDAI (and currently running for a seat in India’s hotly contested national elections)Nandan Nilekani wrote: “We have always stated that the data collected from residents would remain private, and not be shared with other agencies.”

An audible sigh of relief was heard in the media from privacy activists who were concerned that the data collected by the UIDAI would be easily accessed by any government agency once it was in the system. This concern for privacy and data protection isn’t completely unfounded. Indian media has reported on grave gaps in the data collection process. In March 2013, a Mumbai paper reported that data collected from residents in 2011 was still lying around in cupboards in a suburb, despite the area residents repeatedly reminding the authorities to take away the information.  The same state had, in 2013,  “admitted the loss of personal data of about 3 lakh [100,000] applicants for Aadhaar card”, an error that sparked concerns over possible misuse of the data, not to mention the trouble of having to register personal data all over again. 

According to the report, the data had been lost while uploading from the state information technology department to the UIDAI central server in Bangalore, Karnataka. Government officials tried to assure the public that the data was highly encrypted and could not be misused. However, this incident wasn’t unprecedented. Just the year before, veteran journalist P. Sainath of the Hindu had highlighted this issue in a talk, saying that: “You can buy that data on the streets of Mumbai. It’s already made its way there. What sort of national security will you have when your biometric data is up for grabs all around the planet? You outsourced it to subcontractors who have subcontracted it to further people. It’s now available on the streets of Mumbai, biometric data.”

Given that the government has spent Rs 3800 crore (around $600 million) on the project already, it is interesting to note that India has not yet passed a privacy law, a comprehensive data protection law and nor did the parliament pass the National Identification Authority of India Bill, which was rejected by a parliamentary standing committee on finance in 2011. As was reported at the time, the standing committee rejected the report on the grounds that the scheme had “no clarity of purpose and leaving many things to be sorted out during the course of its implementation; and is being implemented in a directionless way with a lot of confusion”. It also went on to raise concerns about privacy, identity theft, misuse, security of data and duplication during the implementation of the UID scheme, and cited global examples of similar schemes that were rejected.

However, it is useful to see the guiding principles behind the implementation of the scheme that made it so attractive to the Congress-led UPA II government. The spirit of UID seems to lie in two guiding principles; using Public-Private Partnerships (PPPs) to make government more effective, and entering the data game. In a recent interview to the Economic Times, Shrikant Nadhamuni, who headed technology for UIDAI is quoted as saying: “We wanted to move the ID game—from a state where some people had no ID and others had paper ID to something beyond even what Singapore had, in the form of smart cards, to online. Like biometric. Which is the future.”

The basis of the design of what was to become the UID was also laid out in the Report of the Technology Advisory Group for Unique Projects, submitted to the Ministry of Finance in 2011, headed by Nandan Nilekani, a respected figure in Indian business and later to become CEO of UIDAI. Others involved with the report were the chairman of the Security and Exchange Bureau of India (SEBI), the secretary, Department of Telecommunications of the Government of India, the chairman of the privately owned IFMR trust which seeks to ensure that every individual and enterprise has access to financial services, and a few other experts on the subject. Many government officers constituted the secretariat. The report put out some revolutionary ideas about how to integrate private expertise into the public sector. It deduces that “the most important lesson that needs to be acted upon is that business change’ should drive the design and implementation of these projects”.

This was to be done by implementing a National Information Utility (NIU), which would be private companies with a public purpose: profit-making, not-profit maximising. The NIU would be flexible in its functioning, and the government would keep strategic control over the project. Private ownership of the project should be at least 51% and the government’s share at least 26%. Once the NIU is to become steady, the government would become a paying customer and would be free to take its business elsewhere. However, the report also admits that given the massive investments in building the NIUs, they would essentially be set up to be natural monopolies. At the time, the report had looked at the following schemes of the Indian government: Goods and Services Tax (GST), Tax Information Network (TIN), Expenditure Information Network (EIN), National Treasury Management Agency (NTMA) and New Pension System (NPS). The first Unique Project to take off, however, was the UIDAI.

This strategy raised red flags as well. Usha Ramanathan, an academic activist, wrote in Moneylife that: “In this set-up, we are witnessing the emergence of an information infrastructure, which the government helps — by financing and facilitating the ‘start-up’, and by the use of coercion to get people on to the database — which it will then hand over to corporate interests when it reaches a ‘steady state’.” She continues in the same piece that: “The NIU was not explained to parliament, and no one seems to have raised any questions about what it is. This, then, is the story of how the ownership of governmental data by private entities is silently slipping into the system.”

Controversies surround the Aadhar project. Nilekani, who was appointed Chairperson of UIDAI in 2009 by the current UPA government, and simultaneously given the rank of a cabinet minister, is increasingly in the news because rumours are swirling in India that a new government might choose to shelve the project. The card, that was envisioned to become an almost one-stop-shop in the future years regarding the delivery of welfare schemes and subsidies, is no longer mandatory to avail some of these, according to India’s Supreme Court. This is a setback to the government that considered the Aadhar card a method to plug “leaks” in the government delivery systems.  Despite this, reports of data leakage, and even stories of fake Aadhar cards making their way into the news, the current establishment seems hopeful. The deputy chairman of India’s Planning Commission, Montek Ahluwalia, made a statement that the card did not require a legal basis to be used for transferring benefits to citizens, much in the same way citizens are not legally required to hold degrees to gain jobs.

The UIDAI project remains complex – a herculean task. The UK government shelved its identity card project because it was untested and the technology not secure, and because of the risks to the safety and security of citizens. With India in the midst of an election, it remains to be seen what will happen when a new government is formed, and whether the country can succeed in this task.

This article was published on April 10, 2014 at indexoncensorship.org

5172 - Is it the end of the road for Aadhaar? - Business Standard

Is it the end of the road for Aadhaar?

Government's decision to suspend Aadhaar-based cash transfers in LPG has dealt a fresh blow to the project whose utility has always been questioned

Surabhi Agarwal  |  New Delhi   February 05, 2014 Last Updated at 23:15 IST

First they ignore you, then they laugh at you, then they fight you, then you win…" go the famous words by Mahatma Gandhi. 

Every stage of the saying fits the evolution of the Unique Identity or Aadhaar project, except for the last part - winning. 

Each time in its four-year journey - which has been no less than a roller-coaster ride - the ambitious project seems to be turning a corner, a controversy here or a revolt there threatens to stop it in its tracks.

Last week, the government decided to put in abeyance direct benefit transfers in cooking gas subsidy - one of the biggest showcases for UID-based payment system in the wake of ground level implementation challenges. Optimists dismissed it as just another setback for the Nandan Nilekani led-Unique Identification Authority of India (UIDAI), but a 360-degree view of the project reveals the shaky grounds on which it currently stands.

A petition questioning the rationale for making Aadhaar mandatory for government services has turned into a full-fledged argument on the need for the unique identity number, with the very fundamentals of the project being questioned in the Supreme Court. The court's interim order that no one should suffer for not having the number has also dampened the government's enthusiasm for the direct benefits transfer (DBT) project. The scheme, which has been piloted in only a few regions, is no longer being pushed by the government with the same aggression.

Nilekani has been the face of the project and is credited with meandering through various challenges to scale it up. But he has announced his intentions to switch to the political side and contest in the forthcoming elections. Moreover, the UID Bill, which gives the project a statutory backing, is yet to be cleared by Parliament. Given that the current session will focus on the Interim Budget and will also be the last for this government, the Bill is unlikely to be taken up. Another piece of legislation, which is required to douse the privacy concerns pertaining to the project - the Privacy Bill - looks like a distant reality too. The Bill, which would have addressed issues such as misuse of information collected by UID by third-party agencies, is still pending approval.

To add to this is the uncertainly surrounding the political landscape in the country. What if the UPA government is voted out of power? A Bharatiya Janata Party-led government may not prove to be the most favourable for the project's future. The Standing Parliamentary Committee, headed by BJP leader Yashwant Sinha, which studied the UID Bill, had raised many concerns including the very need for UID.

Aadhaar on steady ground

"What is the threat?" counter-questions a UIDAI official when posed with the various questions facing the project. The official who does not wish to be identified argues that putting DBT in cooking gas subsidy on hold does not mean that it is being scrapped. He says Aadhaar will continue to be used to identify LPG customers, even though the payments will not be made directly into the bank accounts. As far as the Supreme Court order is concerned, he says, all the pertinent questions regarding the project will be answered once and for all. "It has created an opportunity for our detractors to shut themselves." The official adds how the Supreme Court's interventions have actually helped decide matters like privatisation in the telecom sector and the spectrum issue subsequently. "Any change in the world has always been resisted like this, so it's nothing unusual."

The project has been constantly under fire since its very inception, more from inside the government than outside. While the Planning Commission - of which UIDAI is an attached body - was the first to raise objections about administrative matters, the project entered into a fierce battle with the Union home ministry's Registrar General of India - which is creating a National Population Registrar - on the issue of collecting biometrics. Then headed by P Chidambaram, the home ministry had also raised security concerns over UIDAI's enrolment process. The two entered into a compromise later to resolve the matter.

"It was the government which did not allow UID to work," says a former UIDAI official, adding that the opposition was due to the fact that Aadhaar was turning into a huge cleansing agent in the government (direct transfer of subsidies to Aadhaar-liked accounts would have minimised the leakage in welfare payments apart from bringing transparency in government functioning). The official who is saddened by the decision on DBT in cooking gas says that he is still "optimistic" as the government is in an "election mode" and doesn't want to antagonise anybody. However, "the project is irreversible now with almost 600 million residents enrolled."

In late 2012, the government decided to roll out DBT on a war footing where the subsidy money would directly go into the Aadhaar-linked bank accounts of the intended beneficiaries. That was perhaps the only time when the project seemed to have solid backing from the Congress as well as from most wings of the government.

However, issues with ground-level implementation and the subsequent Supreme Court order sapped DBT of its initial momentum. Some bureaucrats attribute the issues that UIDAI has faced to the "hurry" in which the project was implemented. Another former official says the correct way for the government to roll-out direct transfers was to ensure significant saturation of Aadhaar first in an area and then link it with welfare payments. "Without that, public resentment had to be there," the official says, adding that even though Aadhaar has a lot of potential, the DBT scheme was not well thought out. "States were not consulted enough, which is now showing through public feedback."

Another former government official who worked closely with the authority says that in a hurry to meet its target, the authority did not regard "government protocol," which is the prime reason for the bureaucratic resistance it faced. "The utility of Aadhaar was not thought through before rolling out such a large project, its usefulness is still a mirage for people."

However, some are optimistic. Srikanth Nadamuni, chief of Khosla Labs, a start-up incubator who was roped in as a technology advisor by UIDAI, says that the project is in a flux right now and there is bound to be some pushback. "This is an in-between phase for the project, and people will soon see the usefulness of it."

The positives

To be sure, UIDAI has done remarkably well when it comes to meeting its enrolment target: it has already covered 572 million people and will soon touch the 600 million mark - a target it had set for itself when it first started out. On Tuesday, the Cabinet also expanded the mandate of UID to enroll beyond 600 million people, which means that more residents will come under the project and faster. UID officials argue that 60 million bank accounts have been seeded with Aadhaar already and over 100 agencies are using it for authentication services. The number is now expected to see another spurt.

The Reserve Bank of India has also recently asked banks to put in place the infrastructure required to make sure that Aadhaar-based biometrics can be used as an additional factor of authentication for card transactions. After the initial resistance, banks have largely accepted Aadhaar for proof of identity and address, and some have also begun to launch applications based on its payment gateway and authentication services. However, they have protested against the latest Reserve Bank of India directive.

Praveen Chakravarty, former head of investment banking at Anand Rathi who worked with UIDAI in the area of financial services, says that banks are opposing the move as it will be an additional cost factor for them, especially when business is strained. "But, if you look at the current political leadership, they are spending 30-40 per cent of the campaigning time talking about how Aadhaar can help reduce corruption." He adds that therefore saying that the project doesn't have political backing in view of all the opposition it has faced does not hold true.

Even as the jury is out on whether the ruling United Progressive Alliance government supports the project or not, opposition-ruled Gujarat has been enrolling 100,000 people every day. This is up from 17,000 to 18,000 earlier, says a government official. The state has already enrolled 26 million people. "This happened after Gujarat chief minister and BJP's prime-ministerial candidate Narendra Modi took stock recently and pushed for it to be fast-tracked." This seems like the biggest hope for the project right now.

MAJOR ROADBLOCKS

* Its purpose has been challenged by a petition seeking Aadhaar not be made mandatory for availing of government services

* UID's biggest utility-direct benefits transfer- has suffered due to implementation issues and the interim order of the Supreme Court. In one year only around Rs 500 crore has been transferred through DBT

* DBT in cooking gas, which has seen transactions of over Rs 3,000 crore, has been put on hold

* The UID bill, which will give UIDAI a statutory backing, is awaiting Parliamentary approval

* Banks have opposed RBI's move to make Aadhaar-based biometrics as second factor authentication for card transactions, citing cost issues.

4807 - AADHAAR: How do you build the world's largest identity system? - CSO On Line (Australia)

AADHAAR: How do you build the world's largest identity system?

Speaking at the 2013 AISA conference, Srikanth Nadhamuni, Advisor to the UID Authority of India and Chief Executive Officer of Khosla Labs, talks about the challenges of building an identity system for India.

• Anthony Caruana (CSO Online (Australia))
• — 10 October, 2013 13:34

Here’s a challenge. Take a nation with a population in excess of 1.2 billion people with no privacy or data security laws and create a database that gives each and every person a unique 12-digit identifier and stores their fingerprints, a photograph and their iris. The purpose is to provide secure authentication and access to services.

According to the Indian government, AADHAAR “... is primarily aimed at ensuring inclusive growth by providing a form of identity to those who do not have any identity".

"It seeks to provide UID numbers to the marginalised sections of society.

"Apart from providing identity, the UID will enable better delivery of services and effective governance."

In a country with widely varying wealth and literacy levels, this initiative is seen as a way of including everyone in a system so that there is equal access to government services.

This is critical in a country where 70 per cent of the population lives in villages and less than a third has a bank account.

Srikanth Nadhamuni, Advisor to UID Authority of India and Chief Executive Officer of Khosla Labs, highlights that there is a counter to what seems like a difficult social and economic situation. “There are over 800 million mobile phones,” he said.

The Indian government spends about $40 billion on subsidies for the poor and disadvantaged. However, between 30 to 40 per cent of that money is wasted through distribution to ghost or duplicate identities.

The challenge is that most records are paper-based and kept in the villages where they can’t be shared. Indian residents don’t have a centralised identity such as the Tax File Number system in Australia or Social Security Number in the United States. Identity documents are not portable or usable between cities.

So, how do you solve this problem? Nadhamuni says that the vision of AADHAAR was to create a “common national identity platform for every resident".

"This had to be biometric identity because we had eliminate these duplicates and fakes. We can’t do this using names and addresses and leather-bound books and pen.

“We also wanted to create an online form of identification,” he added. “We wanted to jump from partial ID to full digital ID”.

Every enrolled resident’s biometric information is checked against the entire database at the time of enrolment to ensure that no-one enrols more than once. In the case where a resident lacks a full set of fingerprints - a common occurrence in an agrarian economy where fingerprints are worn away after many years of working the land - a second biometric is also collected. This is the iris of the eye.

AADHAAR supports the registration of residents into a Central ID Repository and verifies identity when accessing online services. Although literacy rates in India are below other countries, access to the Internet over mobile devices is widespread.

Enrolling over a billion people is a gargantuan task. This required the establishment of an ecosystem made up of state governments - as they have the responsibility for managing projects within India’s federal government - as well trained personnel for collecting the data, vendors for creating the biometric data collection equipment, verification authorities to ensure that the equipment was made to the correct specifications and many other entities. The states are paid for each identity that they collect.

“We had to build an entire ecosystem,” said Nadhamuni. This involved hardware vendors, training companies and numerous others in order to build the systems and to have the equipment in order to collect the massive volumes of data.

Much of the technology underlying the AADHAAR system is based on open source tools. When the encrypted data packets for each enrolment are received they are stored using the Hadoop distributed file system. MySQL is also used with MongoDB to support the large data volumes and the need for searches to be executed quickly.

As the data moves through the various stages of validation RabbitMQ is used as the messaging system for moving the data from stage to stage.

Nadhamuni says that “all of this is running on commodity blade servers" and "the idea is to make it scalable; it scales gracefully by throwing blade servers at it”. This is a critical consideration given the volume of data that the system has to manage and process.

Currently, AADHAAR is adding a million new residents each day resulting in 500 trillion data matches as the biometric data is checked in the database. The current storage of 5 petabytes represents about 25 per cent of what will be needed in the long term. Interestingly, iris matching can be executed about a million times faster than fingerprint matching.

Three separate vendors are used for the biometric components as this delivers a much higher degree of accuracy when carrying out de-duplication of the biometric data. “When one thinks it has found a duplicate, we send those packets to the other two and thereby we increase the accuracy of the system.

Currently, this system is two-orders-of-magnitude more accurate than previous best system before AADHAAR” according to Nadhamuni. And, the three vendors are working competitively so if one of the solutions is less effective than the others, workloads are moved. This impacts the revenues of the less effective service provider.

“Dynamic allocation of workloads were an innovation of this project,” said Nadhamuni. As well as de-risking the project it motivates all three vendors to maintain high standards and to continually innovate.

Security is a critical consideration in the AADHAAR system. All data is encrypted at the source and the number allocated to each resident is random - there is no intelligence attached to the sequence or selection of digits in the 12-digit identifier. When a system requests ID validation from AADHAAR it only receives a yes/no response - no other data is exchanged.

All data is encrypted and never transmitted in the clear with data separated into different security zones. Incredibly, much of the data is delivered to the central data centre via physical hard drives. “Never underestimate the bandwidth of FedEx,” commented Nadhamuni.

It’s important to note that AADHAAR is not simply an identity verification system. It’s a platform that can be used as part of a broader security system. For example, if a bank wants customers to verify their identity using a credit card PIN code, this can be used in addition to AADHAAR. This means AADHAAR is not a “closed loop system” added Nadhamuni.

This ability to leverage AADHAAR has resulted in a number of startups launching and existing industries able to reduce inefficiencies in payment and identity systems so they can either improve services or deliver new services.