World governments would do well to learn from India’s ambitious identification programme, writes Joseph Mariathasan

One fact that perhaps has not received enough attention worldwide is that India has managed to set up a system to uniquely identify 600m of its population within a space of four years. The Unique Identification Authority of India (UIDAI) was tasked with guaranteeing that every resident of the country has one Aadhaar number (of 12 digits). There is only one number for each resident, and every person can use it to validate his or her identity. The way India managed to do this has lessons for itself and other governments, in both developed and emerging economies.

While the idea that everyone in a population can be easily identified by the state has negative connotations in many developed countries, the benefits for a country like India are profound. For example, one of the most difficult aspects of establishing a national pension scheme for hundreds of millions of the poorest segments of India’s society is identifying who they are – absolutely accurately – over a period of a lifetime. Many of the potential participants in the National Pension Scheme (NPS) are illiterate, and there may even be no reliable records of their existence.

India has embarked on a project that will have the most profound impact on the nature of its society. The project will also be a cornerstone for the widespread dissemination of social services, including the NPS, to participants in the most remote areas of the country. The establishment and provision of a unique number for every single individual – more than 1bn identities, eventually, that will be able to be verified in real time – enables a host of activities to be undertaken more efficiently. And, of vital importance, it can help ensure that those truly in need of government help are the ones actually receiving it.

What is perhaps the most surprising aspect of the project was that it has succeeded at all, given India’s reputation for appalling bureaucracy. Economist Ram Sewak Sharma, in a recent paper, argues that the UIDA has largely succeeded in a short time and within its budget because it took many innovative and bold decisions.

Three key decisions were, firstly, the inclusion of iris images to the set of biometrics collected by it. Fingerprints, on their own, gave rise to a number of potential problems, while the technology behind iris scans was still developing. A major concern at the time was the maturity of the technology. While fingerprints had been in use for 150 years, the patent for using iris images for identification was granted as recently as 1994.  

Secondly, the UIDAI instituted a policy of conducting on-field trials. The idea of using biometrics to ensure the unique identification and authentication of all the residents of India was an untested one. There were many assumptions behind it, and the data required to test the validity of these assumptions was unavailable. As Sharma explains, the UIDAI conducted several on-the-ground ‘proofs of concept’ trials. These experiments served two purposes: they enabled the UIDA to explore the solution space and learn what might work and what might not, and they allowed it to test its assumptions. Thirdly, the UIDA achieved its objectives through a well-thought-out mixture of promoting competition and standardisation.

As Sharma points out, the success of the UIDAI offers lessons for other government projects – and not just within India. The bureaucracies of governments need not prevent them from taking innovative decisions. High-quality procurement and project-management skills can help them outsource many functions currently housed within them. Testing major hypotheses through field trials before launching projects at scale can also help ensure best use of public resources.

Another critical catalyst for the UIDAi’s success, argues economist Praveen Chakravarty, was its decision to outsource much of the infrastructure to competing private sector players, to ‘smart-source’ identity-data collection. It decided to build an entire ecosystem of private vendors to do the data collection, with costs of machine, people and infrastructure borne by the vendor. This led to ubiquitous but authorised and approved UIDAI data-collection centres and camps that mushroomed all across the country in a short span of time, which made it easy for residents to register. Strict oversight and control mechanisms rested entirely with the UIDAI, protecting data security. It exercised stringent control of data encryption and validation, so, while biometric data of 1bn Indians were collected by thousands of independent government and private agencies, all of them collected the data through a standardised software provided by the UIDAI that encrypted the data, which was then sent back for validation.

The creation of a database of 600m unique identities within four years is, as Chakravarty says, perhaps the fastest of any government or even private sector initiative in recent times anywhere in the world. Governments everywhere have much to learn from this. It will be fascinating to see what India manages to do with this system once it is in place.

Joseph Mariathasan is a contributing editor at IPE

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