Aadhaar uncertainty to be removed, new bill to make it legal

Most of the government’s social security schemes linked to Aadhaar

GN Bureau | November 7, 2015


#Aadhaar card   #Finance minister   #Arun Jaitley   #National Identification Authority of India   #NIAI   #Reserve Bank of India   #governor   #Raghuram Rajan  


Aadhaar will receive legislative sanction with the government ready to introduce National Identification Authority of India (NIAI) Bill in the parliament.

Finance minister Arun Jaitley, who said that Jan Dhan-Aadhaar-Mobile (JAM, as government refers it) is here to stay, made this announcement at Delhi Economic Conclave yesterday.  "I think, now across the political spectrum, state governments and political groups the need and utility for Aadhaar has been universally recognized," he said.

Most of the government’s social security schemes and digital initiatives are critically dependent on use of the Aadhaar number. Uncertainty has surrounded the project after the Supreme Court restricted the use of the number until a constitutional bench delivers its verdict on a bunch of cases challenging the mandatory use of Aadhaar in government schemes and rules on the issue of privacy violation.

“Concerns have been raised that steps must be taken to remove the sense of uncertainty regarding Aadhaar. The need and utility for this has been universally accepted. There is a challenge pending before the court. The question is whether it violates the right to privacy. This will take some time and we can’t have a situation where Aadhaar is accepted with central kind of activity but not accepted for other activities… the draft legislation is already ready,” Jaitley said at the programme.

“We can’t have a situation where Aadhaar is acceptable for certain kinds of measures adopted by the government but not acceptable with regard to certain other kinds of measures. There will have to be a universal standard to be laid down,” the finance minister said.

Reserve Bank of India governor Raghuram Rajan also reaffirmed Aadhaar’s utility in banking. “Aadhaar is extremely useful for a variety of aspects. One of the most important is the ability to build credit histories. Once you have an Aadhaar number, banks feel safe in lending to you. They know you would be reluctant to default,” Rajan said.

"I think if the government can take up the matter in parliament and get it done, it will put a lot of things behind us. We can do a lot of things now but the law would help us to really settle once and for all," said Nandan Nilekani, former chairman of UIDAI and co-founder of Infosys.

Last month, lifting its earlier restriction, the Supreme Court had allowed voluntary use of Aadhaar for welfare programmes including Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), all pension schemes, provident fund and Pradhan Mantri Jan Dhan Yojna. Before the order, the use of Aadhaar was restricted to public distribution system (PDS) and disbursal of cooking gas subsidy.

Despite concerns that the Aadhaar project may not receive the backing of the BJP-led National Democratic Alliance (NDA) government that came to power in May last year, Aadhaar received a fresh lease of life last year after it got the support of Prime Minister Narendra Modi and became a key component of the NDA government’s direct benefits transfer and Digital India drive.

More than 930 million Aadhaar numbers have been issued so far and its coverage is expected to cross 1 billion by March 2016.

How NDA government chose to back Aadhaar: click here

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