Tag Archives: Pranab Mukherjee

Will Aadhaar be the Same with PC as FM?

Well, if media reports have to be believed, P Chidambaram, the Union home minister is all set to return as the finance minister. It does not sound too surprising, considering PC has been one of the best finance ministers that India has had in the recent past. What is more, his track record in the home ministry has been anything but spectacular.  Not only has he failed to achieve much, his tenure has seen continuous friction of his ministry with the states.  In short, his transfer from the finance ministry to home ministry has neither been good for the economy of the country nor for its politics. So his return should be good news for most.

Except those strongly backing UID/Aadhaar.

His dislike of the project—or rather the way it is being rolled out—is well-known. Not only has he disagreed with UIDAI’s way of collecting data, he has written to the prime minister multiple times complaining about it. It is in his insistence that the cabinet discussed in January the possible security loopholes in the way UID was collecting data and decided that while  NPR and UIDAI would use the biometric data collected by each other, in case of discrepancies between UIDAI and NPR data, NPR would prevail.

Again, as recently as last month, he had written to the PM that UIDAI was not cooperating with Registrar General of India (RGI), which was working on the NPR. This is what Mint had reported, quoting from the letter.

“The decision of the cabinet is crystal clear and I am unable to comprehend the reluctance of UIDAI to allow the NPR camps and to accept the NPR data. I had taken these issues with Nandan Nilekani, chairman, UIDAI, dated 14.05.12. The home secretary (R.K. Singh) has also discussed the issue at length with the UIDAI director general and mission director. However, despite our best efforts, issues remain unresolved,” he said.

It is difficult to believe that once he takes charge of finance ministry, his opinion about the Aadhar project would change drastically.

The question is: will it impact the effectiveness of UIDAI?

While it is true that UIDAI is part of the Planning Commission, the reason it became the government’s flagship program so soon is because of strong support from the former finance minister Pranab Mukherjee. Not only did Mukherjee generously provided for the funding of the project in three of his budgets, he made it the basis (aadhaar) of most of the government programs. There were nine reference to Aadhaar in Mukherjee’s budget speech this year. Whether it is for subsidy being credited directly to beneficiary’s bank account, creating a more efficient public distribution regime by creating a PDS network, or for disbursement of government payouts—such as MG-NREGA payments, pensions and scholarships—the finance minister seemed confident that Aadhaar could be leveraged as a platform to deliver. National Payment Corporation of India (NPCI) even created the Aadhaar Payment Bridge Systems.

In short, while the UIDAI chairman Nandan Nilkeani created a new generation platform in form of Aadhaar, it is Mukherjee who was instrumental in making it the flagship platform of all developmental activities in India. So much was Mukherjee’s liking for Nilekani that he made him head some half a dozen task forces, groups, and committees entrusting him with most changes. I wrote about it in a post in this blog earlier called The Importance of Being Shri Nandan Nilekani. Mukherjee had even gone to the extent of openly backing Nilekani on PDS reforms when the food ministry was ignoring the recommendations of a committee headed by him.

From there, it would be quite a change for Aadhaar/Nilekani if Mukherjee is succeeded by someone who very recently complained so strongly about the project to the prime minister, taking the name of its chairman.

Things would probably have been a little different had the UIDAI been a independent statutory body. A proposal to make it one was rejected by a Parliamentary Standing Committee headed by Yashwant Sinha a few months back. Interestingly, in its report, the Committee had extensively quoted news reports about the home ministry’s objection to/criticism of Aadhaar to justify its decision.

Both Chidambaram and Nilekani have proven track records. The country will benefit if they work in tandem. Another conflict in the government is the last thing that we want in the time of this apparent policy paralysis. Not only will it make another fresh and fairly successful experimentation in the government go astray, any drastic change in the path will make very wrong signals to international community. After 2G decision and GAAR, the last thing the country would like to see is going back on UID plans.

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The Importance of Being Shri Nandan Nilekani

If there was one proper noun that stood out in the budget speech of the finance minister, Mr Pranab Mukherjee this year, it was undoubtedly Aadhaar. The speech had as many as nine reference to Aadhaar. Whether it is for subsidy being credited directly to beneficiary’s bank account, creating a more efficient public distribution regime by creating a PDS network, or for disbursement of government payouts—such as MG-NREGA payments, pensions and scholarships—the finance minister seemed confident that Aadhaar could be leveraged as a platform to deliver.

And it was just a couple of months back that a section of the media was writing off the project when the National Identification Authority Bill met with some adverse comments from a parliamentary standing committee headed by BJP MP and former finance minister Yashwant Sinha! In a cover story in Dataquest, The Politics of Identity, I had unequivocally pointed out then that “the Parliamentary Standing Committee’s return of the National Identification Authority in its present form is not a mandate to scrap the project; though some vested interests portray it that way.”

And I was not exactly being prophetic. Anyone following the project would know that this has been the most important project for UPA II for driving its No 1 policy priority: inclusion. And the government would not easily allow it to fall by the wayside.

In fact, since 2009 (that is beginning of UPA-II), the finance minister has, in all his budget speeches referred to the project. Here is a compilation of what he said about the project, in each of his budget speeches.

The setting up of the Unique Identification Authority of India (UIDAI) is a major step in improving governance with regard to delivery of public services. This project is very close to my heart. I am happy to note that this project also marks the beginning of an era where the top private sector talent in India steps forward to take the responsibility for implementing projects of vital national importance. The UIDAI will set up an online data base with identity and biometric details of Indian residents and provide enrolment and verification services across the country. The first set of unique identity numbers will be rolled out in 12 to 18 months. I have proposed a provision of Rs.120 crore for this project – July 2009 Budget Speech

The 2010 budget speech referred to the progress and raised the allocation to Rs 1900 crore

In my last Budget Speech, I had announced the constitution of the Unique Identification Authority of India, its broad working principles and the timelines for delivery of the first UID numbers. I am happy to report that the Authority has been constituted and it will be able to meet its commitments of issuing the first set of UID numbers in the coming year. It would provide an effective platform for financial inclusion and targeted subsidy payments. Since the UIDAI will now get into the operational phase, I am allocating Rs.1,900 crore to the Authority for 2010-11 – Budget Speech 2010

 By 2011, Aadhaar project had established its potential, in the eyes of the FM, as one of the most important initiatives to improve governance

The UID Mission has taken off and Aadhaar numbers are being generated in large numbers. So far 20 lakh Aadhaar numbers have been given and from 1st October 2011, ten lakh numbers will be generated per day. The stage is now set for realising the potential of Aadhaar for improving service delivery, accountability and transparency in governance of various schemes – Budget Speech 2011

The 2012 speech, which was full with reference to the project, too saw it on top when it came to highlight plans for improving governance.

The enrolments into the Aadhaar system have crossed 20 crore and the Aadhaar numbers generated upto date have crossed 14 crore. I propose to allocate adequate funds to complete another 40 crore enrolments starting from April 1, 2012. The Aadhaar platform is now ready to support the payments of MG-NREGA; old age, widow and disability pensions; and scholarships directly to the beneficiary accounts in selected areas – Budget Speech 2012

This year, the FM allocated Rs 14,232 crore for the project.

It is now amply clear that as far as the finance minister is concerned, this is a project that is close to his heart, as he admitted in his July 2009 speech.

That is not too surprising, considering that the government has huge expectations from the project. What is, however, noteworthy, is the kind of importance the finance minister has given to the person driving the project: Nandan Nilekani.

In 2010, he was appointed as the chairman of a Technology Advisory Group for Unique Projects (TAGUP) in the Finance Ministry. The group submitted its report in end January 2011. In his budget speech this year, the minister informed the parliament that two of the projects are being implemented, including the ambitious GST Network. Soon after the TAGUP submitted its report, Nilekani was appointed as the head of a task force to recommend mechanisms for  transferring the subsidies directly to the beneficiaries. The 2012 budget speech also informed the Parliament that the task force recommendation has been accepted.

“The recommendations of the task force headed by Shri Nandan Nilekani on IT strategy for direct transfer of subsidy have been accepted. Based on these recommendations, a mobile- based Fertiliser Management System (mFMS) has been designed to provide end-to-end information on the movement of fertilisers and subsidies, from the manufacturer to the retail level,” the FM said in his budget speech.

And with that, “Shri Nandan Nilkani” had the honour of featuring in three subsequent Union Budget speeches. I doubt if there is any other example of this in independent India. While in 2010, only two people featured in the budget speech, Nilekani and Kirit Parikh, 2011 too saw two names: Sam Pitroda and Nilekani. This year’s speech had only Nilekani’s name.

And who knows what new assignment is in store for him this year!

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