A UNIQUE DILEMMA
AADHAAR IS LEGALLY VALID BUT THERE ARE NOW LIMITS ON ITS INDISCRIMINATE USE. THE SUPREME COURT VERDICT HAS ALSO VALIDATED CONCERNS OVER DATA PROTECTION AND PRIVACY
IF YOU ARE PART OF THE WORKFORCE THAT PAYS income tax, you must have an Aadhaar number. If you are not financially sound/ socially backward and need to access government welfare schemes, you must show the 12-digit unique identity number. Even if you don’t belong to either of these categories, you will need a PAN (Permanent Account Number) for financial transactions aggregating over Rs 2.5 lakh a year. And your PAN must be linked to your Aadhaar number.
In other words, if you live a life of relative privilege, and even if you don’t and depend on government welfare schemes, you need Aadhaar. This is a practical reading of the September 26 Supreme Court verdict on the constitutional validity of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016. While upholding its validity, the five-judge constitutional
bench of the Supreme Court struck down Section 57 of the Act, which allowed corporate entities or even individuals to demand Aadhaar for their goods or services. The apex court also struck down a circular issued by the Telecom Regulatory Authority of India (TRAI) in March 2017 mandating the linking of mobile numbers to Aadhaar. The Unique Identification Authority of India (UIDAI), the agency responsible for implementing the Aadhaar scheme, has now asked telcos to submit plans by October 15 to close down their Aadhaar-based authentication systems in line with the Supreme Court order.
BUT PLANS ARE ALREADY AFOOT TO RESTORE the provision to mandatorily link Aadhaar to mobile phones and bank accounts—Union finance minister Arun Jaitley has advocated a legislature route for this. A PIL has also been filed in the Madras High Court seeking the linking of Aadhaar to electoral rolls and voter cards. The Election Commission too has said that it has no objection to such a move.
Of course, one can still enjoy many privileges/ rights without an Aadhaar card, such as voting. You can also ignore demands for the number from private entities such as banks (including nationalised ones), phone companies and schools and colleges. But by making the Aadhaar-PAN linking and the requirement of Aadhaar while applying for a PAN mandatory, the verdict has ensured that your bank details reach the UIDAI. In India, a PAN is now compulsory
to open a bank account. While allowing the government to continue linking Aadhaar with government welfare schemes, the court went by the argument that it was serving a much larger public interest. Reading out the verdict, Justice Arjan Kumar Sikri said the bench was satisfied that Aadhaar was a suitable means to achieve a legitimate goal—prevention of leakage and pilferage. The court upheld Section 7 of the Aadhaar Act, which states that it is mandatory for any government scheme that draws out of the consolidated fund of India. This means that if you want to avail of benefits such as PDS rations, LPG subsidy or entitlements under MNREGA, you have to furnish your Aadhaar number or an Aadhaar enrolment ID.
The proponents of Aadhaar often argue that it has reduced leakages in the delivery of public services. Hailing the SC verdict, NITI Aayog CEO Amitabh Kant said: “Over Rs 90,000 crore is saved every year by plugging leakages in over 500 welfare schemes through the use of Aadhaar for authentication.” Lawyer-author Rahul Matthan, who represented the interests of private sector companies in the Aadhaar case, argues that Aadhaar’s digital infrastructure has cost benefits. “The cost of KYC (know your customer) approval for giving a loan was Rs 1,000. But because of Aadhaar-based eKYC, the cost is down to Rs 5,” he says.
However, a study conducted by the same NITI Aayog in Puducherry, Chandigarh and Dadra and Nagar Haveli between January 2016 and March 2017 found that leakages in Direct Benefit Transfer through Aadhaar-seeded bank accounts has not been lower than the earlier estimates of leakages under the public distribution system.
According to development economist Reetika Khera, a strong advocate of data privacy, Aadhaar has no role in plugging leakages or in the identification of legitimate beneficiaries. Instead, it has created an ecosystem of exclusion. Khera, in fact, argues that the primary purpose of Aadhaar was never to improve financial inclusion or welfare administration as projected. “Welfare was just the sugarcoating to facilitate an essentially commercial project. These commercial activities required a digital ID infrastructure such as Aadhaar, which was built using public money,” she wrote in a column. To substantiate her claim, she says that several “volunteers” who helped build the Aadhaar infrastructure are now using the platform to build their businesses.
The Supreme Court took note of one of her articles in which she had mentioned a survey of 900 households in Jharkhand, which proved that the mandatory Aadhaar identification excluded the most vulnerable, such as old widows who could not go to the shop to authenticate themselves, and led to great hardship for others. Although the bench headed by then chief justice Dipak Misra held that Aadhaar was meant to facilitate delivery of welfare benefits to the marginalised sections, it also sent a warning to the government: “In the context of the serious grievance of financial exclusion, the court directs that no individual should be excluded from the receipt of welfare entitlements, such as foodgrains, for want of an Aadhaar number.”
But the bigger worry for the petitioners, who had challenged the constitutional validity of the Aadhaar Act, is the Aadhaar architecture, which enables a comprehensive surveillance by the government. The petitioners argued that the Aadhaar Act violated the fundamental right to privacy, which the Supreme Court had upheld in 2017.
The architecture of the Aadhaar project consists of a
Central Identities Data Repository (CIDR), which stores and maintains authentication transaction data. Based on this architecture, it is possible for government authorities to track down the location of the person seeking authentication, argued one of the petitions. Economist Jean Drèze says the court verdict does little to curtail the powers Aadhaar gives the government to link multiple databases and build an infrastructure of surveillance. Senior advocate Shyam Divan argued in the Supreme Court that the Aadhaar project was an electronic leash to keep people under control. “Centralised and inter-linked databases also enable tracking, profiling, leading to self-censorship, which endangers our freedom,” says Khera.
INDEED, IF AADHAAR DOES FINALLY GET LINKED with bank accounts, mobile numbers and voter IDs, the government will be able to put citizens under a 360-degree surveillance, a fear often expressed by critics of Aadhaar.
Matthan agrees with this, saying that the possibility of connecting various databases could threaten the privacy of citizens. “The Aadhaar data itself is not dangerous. What is dangerous is Aadhaar connected to all government databases such as MNREGA, LPG distribution etc. Currently, they are under separate ministries and it’s not easy to connect them. But if there is an initiative to connect these, it must adhere to the Right to Privacy, as defined by the Supreme Court last year,” he says.
The court took note of these concerns but opined that data collection by Aadhaar was minimal and served a much larger public interest. It, however, provided partial relief to the complainants by striking down the provision that allowed the archiving of authentication records—wherever a person used Aadhaar to prove his identity—for five years. Such records can now be kept only for six months. The court also banned storage of metadata of transactions by individuals. This means the UIDAI cannot collect data sets and mine it for more data or analysis. The SC also struck down Section 33(2) of the Aadhaar Act, which allowed sharing of data with security agencies on grounds of national security. Section 47 of the Act, which allowed only the government to complain in case of theft of Aadhaar data, was also revoked. Now individuals too can file a complaint. The Supreme Court also asked the Centre to bring a robust law for data protection as soon as possible.
The government is currently examining the draft personal data protection bill 2018, submitted in July by the Justice B.N. Srikrishna-headed expert panel. One of the strongest criticisms against the draft bill has been that it proposes stringent measures against data privacy violations by private players but goes soft on possible breaches by government. According to Smriti Parsheera, consultant, National Institute of Public Finance & Policy, the proposed bill needs strengthening when it comes to data access by intelligence and law enforcement agencies. “There is a disconnect between what the report is saying and how much of it is reflected in the bill. For instance, in the discussions on access to data by enforcement and intelligence agencies, the report emphatically states that current systems are insufficient and we need reforms like prior judicial review for authorising surveillance activities. This thinking, however, has not been translated into the draft law,” she says.
Justice Srikrishna recognises the dangers of state surveillance and has recommended that the government pass a law on judicial supervision of executive action for surveillance. “The idea behind the proposal to add parliamentary approval for such surveillance with an expiry term of six months is to include the three legs of democracy,” says Matthan.
He then points to the biggest flaw in the proposed privacy law—there is no penalty on the government for violating privacy provisions. Perhaps such impunity is what has encouraged the government to violate Supreme Court orders related to Aadhaar as well. For instance, despite an SC directive in 2015 restricting mandatory submission of Aadhaar to five welfare schemes, the Narendra Modi government has linked it to at least three dozen welfare programmes. And now the court has had to warn the government not to exclude those who don’t have Aadhaar from welfare schemes since there is still no architecture and guidelines in place to provide for them.