Why is UID number being made compulsory through the backdoor?
Moneylife Digital Team 04 January 2011

While UIDAI and its chairman had said that the biometrics-based UID number would not be mandatory for Indian residents, many financial institutions and service providers are planning to turn it into the final word for identification

The biometrics-based unique identification number (UIDN) programme was launched with an open declaration that it would not be mandatory. However, the union government (the chief financier for the project) and the Unique Identification Authority of India (UIDAI) are busy creating backdoor compulsions for UIDN through financial institutions and service providers, to ensure that people enrol or be left out of the system.

Only yesterday, labour secretary PC Chaturvedi told media persons that once the UIDN project is fully launched, the number would also help track provident fund (PF) accounts of individuals. Even the railways, as if not to miss the train, is planning to provide targeted concession to low-income group people through the UID number. According to reports, the railways wants to use the UID number to identify people living below the poverty line (BPL) and sell cheaper tickets to them. Although at present there is no provision for financial status, it could soon find a place in the UIDAI database, if one is to go by what the railways in planning.

Two months ago, CB Bhave, chief of the Securities and Exchange Board of India (SEBI), had said that the market regulator was working on a new concept of operations based on the UID number. Although, for SEBI this is not the first time that it has tried to enforce an identification for investors. The market regulator discontinued its much-touted 'market participant identification number' (MAPIN) scheme in June-July 2005, after a six-member committee that was appointed to re-examine the use, structure and feasibility of the MAPIN database, recommended an end to biometric identification for investors. (Read 'Now, SEBI jumps on the UID bandwagon')

The question is, if UIDN is not mandatory why are banks, the regulators, the labour ministry and even the railways seeking to incorporate it under the garb of providing facilities or services, unless they want to use it as proof of identification. The list of UIDAI's associates, or partners for UIDN (also known as Aadhaar number), does not end here. There are many fat-profit organisations, which are collaborating with Aadhaar. This is not illegal, however, the question is why would a fat-profit organisation want to join this controversial project and spend public money?

As mentioned, the UIDAI database may include information related to financial status of an individual and thus would provide a golden opportunity for these fat-profit organisations to undertake targeted marketing. This aspect may have turned the Aadhaar project into a magnetron where UIDAI would be the magnet and these fat-profit organisations the electric power to generate extremely high frequency (targeted marketing) and short bursts of very high power (you get a UIDN or else…).

Addressing the Nielsen company's "Consumer 360" event in New Delhi not so long ago, Nandan Nilekani, chairman of UIDAI, said, "The (unique identification) number will create a much more open marketplace, where hundreds of millions of people who were shut out of services will now be able to access them."

Using UID, or allowing its database to be used by companies for marketing would turn the UIDAI into a business against its mandate, activists say. In addition, if at all the UIDN project is so good, why are leaders (political and business), bureaucrats and Page3 celebrities being kept out of it? Why not use their services to popularise the spread of UIDN, instead of launching it in some remote village in Maharashtra?
Our mails to the UIDAI chairman and other officials were unanswered.

Read more:
Now, SEBI jumps on the UID bandwagon
UID = more 'consumers', admits Nilekani
Right to privacy and biometrics of the UID
National UID: An Orwellian Odyssey
UIDAI's not-so-'clean' partners and their tainted executives
Fat profit institutions continue to board UID bandwagon

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