How Aadhaar evolved into an invisible tool to monitor almost all our transactions

Sold as a concept to plug leakages in welfare schemes, Aadhaar is now creating more problems than what it had set out to resolve

By Kundan Pandey
Published: Wednesday 19 July 2017

Illustration: Sorit

On September 29, 2010, when the first Aadhaar was issued, the then Prime Minister Manmohan Singh said that the economically and socially backward people will be the biggest beneficiaries, who, till then, couldn’t avail the benefits of government welfare schemes due to lack of identity proof. Seven years later, with a data-base of more than 1.1 billion individuals, Aadhaar has now brought almost every citizen under its radar. Today, it is mandatory even for rural children to get midday meal or TB patients seeking treatment under a government scheme. The 12-digit unique identity number has created unique problems by making it a must-have for almost every facility a citizen wants to avail, irrespective of his or her social and economic status.

Notwithstanding the criticism that the world’s largest biometric identification system has been facing over violation of privacy, the government has been consistently widening its scope. So far, the Centre has issued at least 50 notifications expanding the scope of Aadhaar. From train ticket concessions to marriage certificates and entrance tests to banking, Indians are now being asked to produce Aadhaar number to access both government and private sector services. This is happening at a time when most developed countries have already dropped the idea of having Aadhaar-like identification system to protect people’s privacy. Even the US, one of the first countries in the world to have a national identification number for its citizens, does not collect fingerprints or scan iris to create social security number (SSN) because “the use of fingerprints was associated in the public mind with criminal activity, making this approach undesirable” (see box: ‘Choosing privacy). Unlike India, the US has a privacy law that makes it unlawful for government agencies to deny benefits just because the individual refuses to disclose his SSN. While the critics of Aadhaar argue that biometric data are more intrusive than photographs used in other identity documents, the government has dismissed this argument.

Choosing privacy over identity
Most developed countries have given up on Aadhaar-like identification system to protect people's privacy


The idea of identity cards was floated in the aftermath of 9/11, which became Identity Cards Act 2006. Around 10 million ID cards were to be issued by 2016. However, people resisted the idea. When the Conservative and Liberal Democrat Coalition government came to power in 2010, it abolished the scheme. About 15,000 issued cards were cancelled. The then Deputy Prime Minister, Nick Clegg, said, "The ID cards scheme was a direct assault on our liberty, something too precious to be tossed aside."


There is no biometric card system in Germany. But before the unification, the West German government tried to create a 12-digit personal identification number (Personenkennzeichen, PKZ) for its citizens in 1973. But the Bundestag, a constitutional and legislative body, rejected it in 1976. It found the concept incompatible with the then existing legal framework.


The Australia Card was mooted in 1985. The card was supposed to replace all other identity cards and help authority to act against tax avoidance and health and welfare fraud. A legislation was also introduced in parliament in 1986, but due to lack of majority in Senate, the bill was blocked. Opposition parties opposed the bill vehemently, leading to the dissolution of the government.


While Personal Identification Number was proposed, the Hungarian constitutional court in 1991 found collecting and processing of personal data without specific purpose (for future) unconstitutional.


The country has a social security number, but it does not collect biometric information like Aadhaar. Moreover, the social security number is not for personal identification. USA also has a strict law related to privacy of citizens.

Concept gone astray

“It’s a disturbing sign,” says Sanjay Hegde, a senior advocate in the Supreme Court. The founding premise of Aadhaar was to recognise the exact beneficiary of government subsidies and weed out duplicates and forgeries. Enrolling for Aadhaar was an individual’s choice. Till about six months ago, it was not mandatory. In fact, even a ruling cabinet minister, Minister of State for IT and Electronics, P P Chaudhary, told the Lok Sabha in December 2016 that Aadhaar would not be forced upon anyone. That statement now seems farther from truth.

Unfortunately, the Supreme Court’s intervention has been wobbly. In March 2014, it said Aadhaar was not mandatory to avail social welfare schemes. But in August 2015, it agreed to make Aadhaar mandatory for cooking gas subsidy. Later in October that year, it also allowed the use of Aadhaar for Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), Pradhan Mantri Jan Dhan Yojana (PMJDY), the Employees’ Provident Fund scheme and pensions by central and state governments. Several violations to apex court’s order were reported after that and individuals were even mandated to provide Aadhaar to apply for merit-based scholarships.

Citizens are in supreme confusion as they are wedged between government notifications and Supreme Court’s observations on linking Aadhaar to different services. The same confusion prevailed over making Aadhaar-PAN linkage mandatory for filing income tax. Currently, 22 public interest litigations (PILs) related to mandatory possession of Aadhaar and infringement of right to privacy are pending before the apex court. On July 7, the court told the government and the petitioners to jointly impress upon the Chief Justice of India to constitute a constitution bench, observing, that it has been more than 696 days since a three-judge bench had first demanded it.

Just like its implementation, the road to making Aadhaar into an Act has been mired in controversies (see box: ‘Road to an identity’). On March 3, 2016, the government presented Aadhaar (Delivery of Benefits, Subsidies and Services) Bill as a money bill to avoid voting in the Rajya Sabha. It also introduced last-minute amendments to the Bill to make Aadhaar mandatory. The upper house recommended a provision, wherein, if an individual chooses not to enroll for Aadhaar, he should be offered “alternate and viable means of identification” for delivery of subsidy and other benefits. The Bill, however, was passed with-out considering the recommendation.

Not a foolproof system

Meanwhile, several other problems plague the scheme. Take the case of Om Prakash, a 69-year-old resident of Sonia Vihar, Delhi. His Aadhaar application got cancelled, and for the past six months, he and his son have been trying to find a solution. In absence of Aadhaar number, he has not got his pension.

The Unique Identification Authority of India (UIDAI), which issues Aadhaar number, admits that there may be a technical problem in at least five per cent of the cases. According to the government own data, thousands in Jharkhand and Rajasthan do not get benefits of PDS due to errors in biometric authentication. Not only this, even the security of biometric data is a major concern. According to a study published by the Centre for Internet and Society in May 2017, data of over 130 million Aadhaar card holders have been leaked from just four government websites. A concept, introduced to ensure that poor are not excluded from welfare schemes, is now perceived as an experiment whose risks outweigh benefits. And citizens are left with no choice.

Road to an identity
How Aadhaar evolved over the years into an invisible tool to monitor almost all transactions of an individual
  • March 3, 2006: Department of Information Technology (DIT), Ministry of Communications and Information Technology (MCIT) gives administrative approval for a scheme to issue unique identity cards for below poverty line (BPL) families.
  • December 4, 2006: The government decides to merge two schemes, the National Population Register under the Citizenship Act, 1955, and the Unique Identity Cards (UID). An Empowered Group of Ministers (EGoM) is constituted to look into the methodology.
  • January, 2009: The Unique Identification Authority of India (UIDAI) is constituted.
  • December 3, 2010: The United Progressive Alliance (UPA) government tables the National Identification Authority of India (NIAI) Bill in the Rajya Sabha.
  • December 10, 2010: The Lok Sabha refers the NIAI Bill to a standing committee for examination
  • December, 2011: Standing Committee on Finance, led by Yashwant Sinha of BJP, rejects the bill. It emphasises the need for a privacy legislation and a data protection law before the scheme is unveiled. The Committee also expresses concern that private agencies are being employed to collect sensitive information.
  • November, 2012: Justice K S Puttaswamy, former Karnataka High Court Judge, files a petition in the Supreme Court questioning Aadhaar. He claims Aadhaar violates fundamental rights.
  • September 23, 2013: In an interim order, the Supreme Court states that no person should suffer for not having an Aadhaar card.
  • March 24, 2014: In a case involving the UIDAI and the CBI, the apex court asks the agencies to revoke any orders made by them making Aadhaar mandatory for availing benefits. It also restricts UIDAI from sharing any information from the Aadhaar database with any agency without the consent of the person concerned.
  • August 11, 2015: A three-judge bench of the apex court restricts the use of Aadhaar to schemes such as LPG and public distribution system (PDS), and says no one would be denied the benefits rightfully entitled to them for lack of an Aadhaar card. More importantly, it refers the issue of right to privacy to a constitution bench.
  • October 15, 2015: A five-judge bench, constituted for seeking clarifications on the August, 2015 order, reiterates that Aadhaar is not mandatory for availing any benefits, but in the interim, expands the scope of the scheme to PDS, LPG, MGNREGA, National Social Assistance Programme, PM's Jan Dhan Yojna and Employees' Provident Fund Organisation. It further asks the Chief Justice of India to expeditiously constitute a bench for final hearing on the matter.
  • March 3, 2016: Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Bill introduced as a money bill in the Lok Sabha.
  • March 11, 2016: Lok Sabha passes the Aadhaar Bill, 2016, with no amendments, and forwards it to the Rajya Sabha.
  • March 16, 2016: Rajya Sabha sends the Bill back to the Lok Sabha with its recommendations. Lok Sabha does not consider the recommendations and passes the Bill in its original form.
  • March 25, 2016: President gives assent to the Aadhaar Bill, 2016.
  • March 26, 2016: The Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, is notified in the Gazette of India
  • April 7, 2016: Congress leader Jairam Ramesh moves a petition in the Supreme Court challenging the introduction and passing of the Aadhaar Act as a money bill.
  • May 10, 2016: The Attorney General (AG) argues in the apex court that decision of the Lok Sabha Speaker to treat it as money bill is not open for judicial review.
  • January 3, 2017: The Ministry of Rural Development releases a notification and makes Aadhar mandatory for persons registered under MGNREGA.
  • January 4, 2017: The Ministry of Labour and Employment releases a notification making Aadhar mandatory to avail the benefits under the Employees' Pension Scheme.
  • January 5, 2017: In a case pertaining to Aadhar, the Supreme Court says, "We are not inclined to give immediate hearing as there are limited resources but biometric data collection by private agencies is not a great idea."
  • February, 2017: Around 30 notifications are issued by various departments of Union ministries making Aadhaar mandatory to avail the benefits of certain welfare schemes and subsidies.
  • March, 2017: 20 more notifications are issued by the Central government that make Aadhaar mandatory to receive the benefits of various welfare schemes.
  • March 22, 2017: As part of the Finance Bill, 2017, an amendment to the Income Tax Act, 1961, is passed in the Lok Sabha. This amendment introduces Section 139 AA that makes Aadhaar mandatory for filing of income tax returns as well as for applying a PAN card from July 1, 2017.
  • April-ongoing, 2017: The Supreme Court is hearing a case challenging the linking of Aadhar to PAN mandatory. The case is ongoing.
  • June 16, 2017: The Ministry of Health and Family Welfare issues a notification making Aadhar mandatory for the treatment of TB patients under the Revised National TB Control Programme.

This story was first published in the July 16-31, 2017 issue of Down To Earth magazine. 

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