Policy in the US has become the unpredictable outcome of a game between a party that irrationally believes government can and should do almost everything, and a party that irrationally believes government can and should do almost nothing.
In the absence of hard numbers, it is anybody's guess as to what is the real intent of the UIDAI project. Is the project really meant to help the poor? Or is it just a corporate ruse to link people, track them and do targeted marketing, with the poor being used as a fig leaf to justify the huge spend on the project?
Unique Identification Authority of India (UIDAI) chairman Nandan Nilekani has been very concerned about privacy implications of the National Unique Identification (UID) project. Time and again, he has emphasized that the project could lead to privacy violations. For instance, he said in March of this year and I quote from an msn.com article: "We are also conscious of the privacy issue. In fact the UID database cannot be read by anybody. The only thing you can use it for is authentication. We are making all efforts technically and legally to see privacy is protected," Nilekani, a former Infosys co-founder, told IANS in an interview.
"At the same time we need a larger debate of privacy and what laws we need in
the country. Today we don't have any privacy laws," said Nilekani who quit Infosys last year and was handpicked by Prime Minister Manmohan Singh to head the authority."
However, as of today, we haven't seen any law on privacy implications that
has been proposed in Parliament.
The publicly available minutes of the recent(6 May 2010) meeting with civil society organizations that the UIDAI had indicates that while UIDAI will draft a law on data security and endorse any potential law dealing with privacy violations, it is not clear if the UIDAI itself considers it as its mandate or even responsibility to come up with the legal framework concerning privacy violations and misuse of the UID database. And if that is the case, that is indeed not just unfortunate but looking at recent developments could even be dangerous.
A few days back, UIDAI signed its first registrar. And who could that be? It was the Life Insurance Corporation of India (LIC). Various media reports have pegged the LIC database size having data of 60 million to 200 million customers.
Some entries of this database namely name, address, and biometrics which LIC will now capture will be shared with UIDAI. What are the privacy implications of the above?
Even granted that the LIC shared only the name, address with UIDAI, the fact is the same entity which has your medical and other vital records now has your fingerprints, iris scans and the UID number. Crores of people buy life insurance or medical insurance from LIC. Lots share their financial data too. For instance, long back when I went to the US for higher studies, I took a loan, which required a guarantee in the form of a, LIC policy. LIC has in its records the fact that I took a loan, and many other details of mine. It is another matter, whether LIC has deleted my name from its database or not, once my policy was matured and I was no longer their customer.
A high-priced consultant brain could give LIC ideas on how to increase its revenue.
Share the medical records with a credit card company. Now, say ICICI Bank is the next registrar of UIDAI. Thus, ICICI now has its credit card number mapped with a UID. Suddenly, one day you start getting, along with your credit card statements, advice on how to deal with your diabetes, or worse still an infectious skin disease that you once had and no longer have. God forbid if you have something like HIV. What you apparently missed is a minor report in the newspaper that ICICI Bank tied up with LIC to share their databases. Now consider you are a young man about to get married, and your fiancé sees your credit card statements time and again having this same ad or advice on how to deal with your infectious disease. Chances are, you can kiss good bye to your upcoming marriage. Worse still, your land lady who stays downstairs who has all the time on her hands happens to inspect the covers of your daily letters or credit card statements. The kind of hell that one could go through is only limited by one's imagination. And given the market centric world that we are in, where everyone is out to sell info for money for all kinds of purposes, UID-the common element that unambiguously links the info-is just the thing we do not want. This is just the tip of the iceberg; wait till something like the Income tax department becomes a UIDAI registrar and has your UID.
You could be potentially stopped from boarding a flight going abroad because you have delayed filing your tax returns.
Quite interestingly, the UID concept was marketed so that the poor could get government doles and to plug leakages in government schemes. How many of the poor have even heard of LIC leave alone avail of their services?
The UIDAI argument is that LIC has this micro-finance system, which the poor avail of. What is not clear is what percentage of LIC's customer base comprises of these micro-finance customers.
In the absence of hard numbers, it is anybody's guess as to what is the real intent of the UIDAI project. Is the project meant to help the poor really or is it just a corporate ruse to link people, track them, do targeted marketing and the poor are just used as a fig leaf to justify the huge spend on the project? And if both, what are the extents of each? Further, if UIDAI is shirking its responsibility to come up with a legislation that will prevent misuse of the UID from abuse by the state or other parties as mentioned above, the only potential justification for this project-namely security of the nation-also falls through.
Finally, I shudder to think of the security issues involved now that apart from the UIDAI database, here is another database-the LIC one which has your fingerprints. One can only imagine of the consequences, given the past records of the security of our government-owned systems.
I was always of the opinion that the UID might have been a good concept. But
after seeing the developments-lack of any feasibility or impact assessment study, the whopping escalation of costs (would anyone in his/her sane mind spend Rs30,000 crore on something just based on a few pages written in a book; the latest estimates peg the cost at Rs45,000 crore), and lack of privacy and other laws preventing misuse, I am getting convinced that the UID project is going wayward. The least that needs to be done is to urgently conduct an independent third-party impact assessment study of the UID project.
And this has to be carried out by an entity which has no potential business interests in the business that will ensue from the UIDAI project, so that they have no vested interests in the results of the study.
As I close this, I think of the new India that is emerging in our cities. Whether one likes it or not, lakhs of our young girls escape the drudgery and hunger in their lives in their villages and come to our cities. Some have dreams of becoming an Aishwarya Rai; many work in dance bars. But our country is far from one about equal opportunities. Most end up working hard just to make ends meet.
Many want to get rid of their old identities, which tie them to their past, their caste, what not. They want to create new identities for themselves, forge new relationships with upwardly mobile guys in the city. What use is UID to them? They do not avail of government doles or aren't beneficiary of any huge government schemes.
Their main interaction with the government happens when cops try to extract bribes from them. It is an open question whether the UID will help them or will be more like a millstone tying them irrevocably to their past.
(Dr Samir Kelekar is founder-director of Teknotrends Software, Bengaluru
The management is very upbeat and analysts see a glimmer of hope since losses are down, but it is really too early to tell whether the company’s operations have merely moved from worse to bad
The TV18 group, which comprises the four businesses of broadcasting (CNBC and CNBC Awaaz), Web (moneycontrol.com and in.com), newswire (Newswire18) and print (Infomedia, which publishes magazines such as Forbes) claims to have reported an “extremely strong quarter” with consolidated revenues of Rs192 crore—a growth of 49% year-on-year. It labels this as a “comprehensive turnaround as TV18 is profitable at PAT level for the quarter”. The company recorded a PAT of Rs31 crore against a loss of Rs140 crore in the same quarter last year. Has there been a genuine turnaround or is it a case of slight temporary improvement? Let’s look at the numbers more closely.
The profit after tax (PAT) for the year came about in the following manner. Revenues increased by about Rs32 crore (a jump of about 20%) and operating expenses got slashed by Rs60 crore or 26%. It is remarkable that TV18 was effectively carrying Rs60 crore or 26% of extra expenditure per quarter! After all, revenues not only suffered as a result of this slash and burn, but actually increased. After this severe belt-tightening, operating profit (after deducting payment to CNBC, US), was Rs21.54 crore or a shade above 11% of revenues. Now, after this operating profit came net interest expense of Rs18.64 crore and depreciation of Rs12.14 crore. So, how did TV18 end up in the black? By other income of Rs21.74 crore. In effect, the core operations are still not making profits at the net profit level.
As far as the segments operations are concerned, Raghav Bahl, group managing director, sounded delighted with the results in a conference call with analysts. He said, “I would say a very deeply satisfying quarter and
year-end for us at Network 18 across all our companies… Revenues were buoyant not just in one or two businesses, but across the group and across every operation… Almost every significant operation is now EBITDA positive in a sustainable way, not just as a single quarter kind of flash in the pan.”
Once again let’s look closely at the segmented data. Some 40% of TV18’s business is broadcasting (CNBC and CNBC Awaaz), the flagship of the group that helps pull in revenues for other businesses. And there, revenues have actually been down even over the terrible quarter that was March 2009, despite the fact that this year’s March quarter revenues were buoyed by the big event of the Union Budget! In March last year, revenues were Rs91.11 crore. This year it was Rs84.06 crore. So revenues were not really buoyant. And yet, Mr Bahl feels that “the two business news operations, which are the two CNBC channels, really bounced back very strongly and are now displaying the kind of strength that was witnessed in 2007-08 in terms of revenue buoyancy behind them. So the fact that they are back is fairly clear to us from the kind of growth we are witnessing.” If so, this quarter will show it. Web18 revenues were up by just 8.5%. Even on a higher revenue, net profit actually halved. There was a big jump in the revenues of Infomedia mainly because of one-time write back of its Business Process Outsourcing Business and also because revenues from several yellow pages directories were booked in the March quarter. Despite this huge jump in revenues, Infomedia still lost money.
While it is fine for the management to be upbeat about the future, there are lot of issues still with TV18’s core operations. What has saved the day for TV18 in the March quarter was slash and burn of enormous magnitude that should leave investors wondering about even the sanctity of these numbers of earlier years. As for sustainability of revenues and profits, the jury is till open.