Dont kill the Aadhaar

Written by Santosh Tiwari | Updated: Feb 4 2014, 08:57am hrs
The governments move to pull the plug on its much-hyped direct benefit transfer (DBT) in disbursing LPG subsidy may throw the whole Aadhaar programme out of gear if corrective steps are not taken immediately to keep the ball rolling. It has gained proportions which can only be utilised and not discounted at any cost.

The total number of Aadhaars issued flashing on the Unique Identification Authority of India (UIDAI) portal at the time of writing this column was 57,75,30,807. At the current pace, the number should cross 60 crore within no time. This means about half the population in the country will be having Aadhaar soon, making them traceable through biometric identification. Of the total number of Aadhaars issued, 30.46% have been taken by individuals aged between 16 and 30, 24.45% by individuals between 31 and 45, 18.67% by those between 6 and 15, 18.32% by those between 46 and 65, 4.45% by those aged 66 years and above, and 3.65% by those below 5 years.

In terms of state-wise penetration, the maximum number of Aadhaars (8.22 crore) have been issued in Maharashtra; followed by Andhra Pradeshs 7.87 crore, and Tamil Nadu with 4.37 crore, Madhya Pradesh (4.2 crore), Karnataka (4.13 crore), Rajasthan (3.8 crore), West Bengal (3.42 crore), Kerala (3 crore), Gujarat and Jharkhand (close to 2.6 crore each in both states), Uttar Pradesh and Punjab (2.34 crore each), Orissa and Haryana (1.8 crore each), and Delhi (1.66 crore).

The short point is Aadhaar cant be ignored any moreit is a huge database which needs to keep growing till there is 100% coverage, and be utilised by the agencies across the country, both central and state-level. Be it linking of Aadhaar with permanent account numbers (PAN) to curb tax evasion, or its linkage to the National Food Security scheme to minimise leakages in the subsidy disbursal, or with land records in the states, the applications are countless to capitalise.

And now there is no doubt that the Aadhaar-based payment system through biometric identification works, and works well. The DBT in LPG distribution has proved beyond doubt that large number of transactions can be done successfully through this mode.

The petroleum ministry itself claimed on December 30: The Direct Benefit Transfer for LPG (DBTL) scheme thus far has been a stupendous success with more than 40 million cash transfers to the consumers bank accounts. A total sum of over Rs 2,000 crore has been transferred in these districts providing direct benefits in the hands of the consumers.

Considering the scheme was launched on June 1, 2013, its spread has been fast and in complete contrast with the DBT schemes performance in other areas like scholarship or pension disbursement, where it was launched on January 1, 2013. Obviously, the differentiating factor has been the fact that DBT in LPG is predominantly handled by the oil marketing companies but DBTs in other areas are being handled by different ministries and departments, and the states too have played their bit in keeping the pace slow. There is no denying the fact that stalling DBT in LPG is a massively retrograde step by the UPA government, after it took the scheme so far.

When oil minister M Veerappa Moily announced the government decision to put on hold DBT in LPG through the Aadhaar-based system last week, it was already running in 291 high Aadhaar-coverage districts, covering 9.5 crore customers out of a total of about 15 crore, throughout the country.

The scheme aims to curb leakages and prevent black-marketing and provide subsidy to consumers in their bank accounts. In these 184 districts, the subsidy on LPG cylinders is being provided directly to the consumers in their Aadhaar-linked bank accounts, the ministry had claimed in December. All that has been forgotten now and a panel will decide on the future of DBT in LPG. In effect, it is highly unlikely that the scheme will be restarted before the next general elections due in April-Maythe new government will take a call on whether this should be done or not.

In the meantime, though, what the government should do at least is to continue with the process of seeding of Aadhaar with the bank accounts and LPG consumers data. This will save the scheme from getting completely derailed. As the problem lies in implementation, there have been complaints that it is difficult for many to first pay the non-subsidised price of the LPG and then wait for getting the subsidised amount in their bank accounts, once a solution is found to tackle this issue, the whole scheme can then be re-initiated again.

The other indication the government needs to give as quickly as possible is that the de-linking of Aadhaar with LPG subsidies will in no way impact the enrolment process for the unique identity number. On an average, over 3 crore Aadhaars have been issued every month in the last four monthsthe highest being 3.32 crore in October 2013.

A good idea, therefore, would be to allow UIDAI now to expedite Aadhaar enrolments in states like Uttar Pradesh, Bihar, Chhattisgarh and Uttarakhand, where it has been slowthis is being done in these states under the home ministrys National Population Register (NPR) programme. The move will allow the UIDAI to keep the momentum going.