No card, only a number despite Rs45,000 crore being spent on the UID project

The Aadhaar project of the UIDAI will just provide unique ID numbers and not unique ID cards as was widely thought

The Unique Identification Authority of India (UIDAI), which is all set for a pilot rollout of its ambitious unique ID (UID) project Aadhaar, will be spending a whopping Rs45,000 crore on the project. But all this money will be spent only on creating a UID number and not a physical ID card-since there is no budget for issuing such cards.

The very first paragraph on UIDAI's website clearly says that its job is to issue unique identity numbers and not physical ID cards. Here is what the site says:"UIDAI has been created as an attached office under the Planning Commission. Its role is to develop and implement the necessary institutional, technical and legal infrastructure to issue unique identity numbers to Indian residents."

This also means Aadhaar is not an ID card but just a unique number. Much more work needs to be done before it can become a smart card for proper identification. So who will issue the ID cards? Most probably, the responsibility will rest with entities which issue ration cards and voter ID cards.

"Nandan (Nilekani, the chairman of UIDAI) wants to keep his hands and conscience clean by just taking on the responsibility of issuing unique numbers to people. He will leave the issue of smart cards to the other corrupt bureaucracies that are responsible for issuing ration cards and voter (ID) cards," said an IT expert, preferring anonymity.

The UIDAI will collect face details, fingerprints from all ten fingers and iris attributes of all residents for ensuring uniqueness of the identities. For collecting data, UIDAI will use various State and Union government agencies-called 'registrars'-like the departments of rural development, public distribution and consumer affairs along with employees of banks, State-run insurance agencies and oil-marketing companies.

The first set of UID numbers will be issued between August 2010 and February 2011.

Thereafter, 600 million UID numbers will be issued in the next five years. The numbers will be issued through various registrar agencies across the country, says the UIDAI website.

Earlier in April, the Income-Tax Department's proposal to issue biometric PAN cards had been put on hold to avoid duplication with the UID numbers to be issued by the UIDAI. A senior finance ministry official had said, "The biometric PAN card project of the department has been kept in abeyance till the UID is rolled out. In the meantime, the suspension will allow the I-T Department to understand and analyse whether after (the issue of) a biometric UID, a PAN with similar features would be necessary or not." (See:

After spending about £250 million over eight years on developing the national ID (NID) programme, the UK government abolished it earlier this year. This scrapping of the project means that Britain will avoid spending another £800 million over a decade. The NID was launched in July 2002-and as of February 2010, its total costs rose to an estimated £4.5 billion. The UK government has cited higher costs, impracticality and ungovernable breaches of privacy as reasons for cancellation of the NID project. These concerns may impact India as well. (See:

Finance minister Pranab Mukherjee had sanctioned Rs1,900 crore for the UIDAI in his Budget for FY11. According to estimates, the total cost of the UID project will be over Rs45,000 crore.

UIDAI itself had admitted that the cost of running such a huge database over years will cost a lot. According to a document on UID numbering available on UIDAI's site, systems that are to be as widely used and for multiple different applications such as the UID will have to be in active use for a very long period.

"Once a billion plus people have been assigned a UID, and applications using the UID to conduct their transactions are evolved, anything that requires modifications to existing software applications and databases will cost a lot," the document said.

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    9 years ago

    By seeing the questions which people are posing, I have 2 thoughts
    1. This article had confused people more than clarifying
    2. UID needs some media campaign to clarify the things


    9 years ago

    Well, what is worse is that the card will not establish citizenship status at all. The website says the number will be issued to "residents of India". So, verifying whether the holder is an Indian citizen is not their responsibility.

    The UID authority is doing a simple database administrator job. Rs 4.5 crore would have sufficed for that. But then, bloating IT budgets is a skill which Software pros are good at.


    9 years ago

    I think the author of this article should first check the facts fully before passing on some judgement. Since, I had worked on this project, I believe that there is lot to this number and making a card is just a simple formality.


    9 years ago

    I am suggesting that Indians having Indian Passport can be given the UID. and it may NOT require any fund. After all Passports are issued after a lot of scutiny by the authorities.
    We have already so many IDs like Passport, PAN, RATION CARD NO., ELECTION VOTING CARD, ...all issued by recognised bodies or authorities.
    Why Government should spent large amount on such issues.

    We should study Gulf countries National Identity Cards Sysytems for Local residents or visa issue system for visitors or foreign workers.
    This are neither so much expensive and issued to all applicants almost within one week.
    All people are recorded and traceable almost instantly.


    9 years ago

    Is this one more step to ruin identification of Indians by the politicians for their self interest Why have UID if No id is going to be issued


    9 years ago




    9 years ago

    to track and trace you.

    big brother 1984 and when all financial transactions go cahsless the govt can just switch off your number!


    9 years ago

    What is the use of having a UID number but no card that can be used as an identity proof like the passport/driving license?

    FICCI for lowering MAT to 15% in DTC

    MAT, which was introduced to bring non-tax-paying companies into the tax net, is currently imposed at 18% of the book profit

    The Federation of Indian Chambers of Commerce and Industry (FICCI) today demanded that the minimum alternate tax (MAT) rate be cut to 15% of the book profit in the Direct Taxes Code (DTC), reports PTI.

    Besides, the chamber in its representation to the finance ministry on the DTC also suggested that all pension schemes be exempted from payment of tax.

    "...the rate for MAT be a specified percentage and in no case more than 50% of the basic corporate tax rate... as the existing corporate tax is 30%, accordingly MAT rate should be 15%," FICCI said in its agenda to the government.

    If the corporate tax is reduced to 25%, MAT should be fixed at 12.5%, it added.

    While revising the original DTC proposal, the finance ministry last month dropped the proposal to impose MAT on gross assets.

    MAT, which was introduced to bring non-tax paying companies into the tax net, is currently imposed at 18% of the book profit.

    As per the revised code, individuals would enjoy tax exemptions in select savings schemes — public provident fund, pension schemes, including the government's new pension scheme, general provident funds, recognised provident funds, pure life insurance and annuity schemes.

    FICCI in its recommendation said, "All pension funds, which are currently registered with the income tax (I-T) department be covered for the purpose of Exempt-Exempt-Exempt (EEE) method instead of restricting it to certain categories."

    Under the EEE mode, the tax exemption is enjoyed at all the three stages--investment, accumulation and withdrawal.

    The other suggestions made by the industry body, including the Special Economic Zone (SEZ) developers, who got approval before DTC became effective, should continue to get the exemptions after the introduction of the code.

    The government last month came out with the revised discussion paper on DTC, which dropped many controversial proposals of the original draft code to help individuals and companies save taxes.

    The government had proposed to bring a bill on DTC in the monsoon session of Parliament and hoped that the new Act, replacing archaic Income Tax law, would be implemented from the next fiscal.

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    Jabalpur-based mutual fund distributor dupes investors

    The distributor collected cash and cheques worth Rs2 crore for investing in mutual funds from numerous people in Jabalpur. The Association of Mutual Funds in India (AMFI) has suspended the ARN number of the swindler

    Jabalpur-based 'Champion Advisory Services', an AMFI-registered mutual fund distribution agency, has swindled investors by collecting cash and cheques to the tune of Rs2 crore. The AMFI registration number (ARN) registered under the name of Chandan Panjwani has now been suspended by AMFI.

    AMFI received a letter from SBI Mutual Fund on 19 April 2010 asking details about the ARN holder. On 20 April 2010, AMFI wrote a letter to Mr Panjwani seeking his reply. Repeated emails sent by AMFI to Mr Panjwani did not elicit a response. Subsequently, AMFI suspended his ARN number on 19 May 2010.

    "He collected cheques from investors and invested in his own name and later redeemed the investments. We have sent letters to the investors also regarding this. We gave him a time of 10 to 15 days to respond. We did not receive a reply so we have suspended the ARN under fraudulent case," said an AMFI official.

    The ARN number 53107 has been currently put under suspension by AMFI. (See here

    Distributors whom Moneylife spoke to said that many investors have lodged a police complaint in the Jabalpur Police Station against Mr Panjwani. The police are still on the lookout for him.

    Mr Panjwani sent this statement to an email query sent by us: "Thank you for your mail. Will reply as soon as I get back."Ever since this fraud came to light, the investor sentiment is depressed in Jabalpur as people are refraining from investing. According to the AMFI website, there are around 172 ARN registered members in Jabalpur currently. 

    "People asked him for account statements but he used to keep telling them that they will receive it after some time. Investors have not got their money yet. He fled with the money. We are facing problems now to convince people to invest in mutual funds. He collected cash from people saying that he is new to the business and requires money," said a Jabalpur-based certified financial planner on the condition of anonymity. 

    Mr Panjwani collected cheques and cash from various people by assuring them good returns. He allegedly ran a 'lottery system'. 

    Jabalpur-based distributors who spoke to Moneylife say that Mr Panjwani is suspected to be in Mumbai after absconding from Jabalpur. He changed six jobs in a matter of one year in various leading mutual fund houses and insurance firms to get a foothold in the industry. Sources indicate that he employed people who were not qualified to sell mutual funds by claiming to offer them hefty commissions. The agents who were working under him have not received their commissions yet.

    AMFI's chief executive HN Sinor and chairman AP Kurian were not immediately available for comments. An email query sent to KN Vaidyanathan, executive director, Securities and Exchange Board of India (SEBI) remained unanswered till the time of writing this article

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    neel gidwani

    10 months ago

    Do Anyone Has Chandan Picture?


    9 years ago

    he fled with 3 lakhs from me too


    9 years ago

    even I have been cheated for abt 3 lakhs
    some one do advise if chandan is found


    neel gidwani

    In Reply to shailesh 10 months ago

    Do u have his picture??

    neel gidwani

    In Reply to neel gidwani 10 months ago

    Can u define his looks??

    U KNOW

    9 years ago

    well, there are many mutual fund branches carry fake expenses of branch to pass on to direct investors. sebi requires to provide level playing field to ifa , nd, banking distribution, relationship or sales manager of amc. because if milk is not good then you should not hit to one cow , it should be accross cows need to be under scaner. so quality justified. There are many offrole persons in amc are doing work without amfi passed. actually mutual fund branch payment system should be centrally processed and disclosed to investors. there are many issues but we want wound to taken care not spread more which hurts to everyone.

    Dillip kumar swain

    9 years ago

    mr jayesh,nothing is negative in this world.without -ve u cann't get positive is big zero.if u say or publish a fact peoples say negative.if u will say fiction peoples will say possitive. because -ve always difficult to digest & +ve always easy to accept.

    Jayesh Doshi

    9 years ago

    Alredy mutual fund business is down since long 2 years and there is no commission income and client doesnt pay any advisory fee . suffering is small agent.because you give publicity to one single case all other small agent people see with doubt.stop negative news of agent.

    Ashok Khaitan

    9 years ago

    Sebi should punish such agent but not the whole agent freaternity by removing entry load.why sebi silent on such serious issues

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