Aadhar - India's Unique Identity

The Supreme Court in its 2018 judgement had held that Aadhaar could be used for welfare, but it recognised a fundamental right to privacy and struck down Section 57 of the Aadhaar Act that enabled private entities to use Aadhaar authentication to establish identity for delivering services.

As an Indian, you must have very well known about Aadhar Card. It has revolutionized India’s identification system. But what exactly is Aadhar, and why does it matter so much? This blog deeply explores Aadhar’s purpose, mechanics, and implications. Come with us on this exciting voyage as we demystify our unique identity system!

What is Aadhar ?

Aadhar is a 12-digit unique identification number issued by the Unique Identification Authority of India (UIDAI) since 2009. Launched in 2009, its purpose is to provide every Indian resident with an identity that can be electronically verified. It utilizes biometric and demographic data as verification points for accuracy and security purposes.

How Does Aadhar Work?

Aadhar operates through a rigorous process, including data collection, verification, and issuing unique identification numbers (UIN). Here’s a simplified breakdown:

Data Collection: Individuals submit biometric (fingerprint and iris scan) and demographic (name, address, and date of birth) information securely stored within the UIDAI database.

Once submitted data is checked against existing records to eliminate duplicates and errors, biometric information undergoes matching to ensure its uniqueness, and once verification is successful, a unique Aadhar number will be generated and issued to each individual.

Benefits of Aadhar

Implementing Aadhar has provided numerous advantages to both Indian citizens and the government alike, including many key advantages:

Efficient Public Distribution System

Aadhar facilitates the targeted delivery of welfare benefits by eliminating intermediaries and providing direct benefit transfers directly. This reduces leakages while reaching intended beneficiaries more efficiently.

Financial Inclusion

Aadhar is a digital identity proof to open bank accounts and utilize various financial services, providing easy and secure access to credit, insurance, and other financial products for the underprivileged.

Simplified KYC Process

Criticism of Aadhar

Aadhaar, India’s unique identification system, was initially implemented to streamline government services and promote financial inclusion while combatting identity fraud. But with the increasing digitalization of this system has come concerns about misuse of Aadhaar data. This essay examines some key issues concerning Aadhaar misuse and its potential implications for individuals and society.

Data Breaches and Security

One of the major concerns related to Aadhaar is its vulnerability to data breaches. With sensitive personal information stored on Aadhaar, such as biometric data, any unauthorized access or hacking could lead to devastating results, including identity theft and financial fraud affecting millions worldwide. Several instances of data breaches have already been reported, exposing millions to identity theft and financial fraud risks.

Identity Theft and Financial Fraud

Aadhar has transformed the Know Your Customer (KYC) process across sectors, cutting down paperwork and time-consuming procedures while streamlining onboarding processes in telecom, insurance, and banking services. Misuse of Aadhaar can lead to identity theft and financial fraud. With Aadhaar being linked with various services and accounts, untrustworthy individuals could exploit the system to access sensitive data for fraudulent activities that cause significant monetary loss, damage to their credit histories and reputations, and damage to individuals themselves.

Concerns Over Privacy

Aadhaar raises serious privacy issues for its participants. The massive collection of personal data without sufficient safeguards raises serious privacy issues that put individuals’ fundamental right to privacy at risk, with the potential for intrusive surveillance or profiling, breaching fundamental liberties. This puts their personal information under constant surveillance by the government while making people vulnerable to constant monitoring or misuse of personal data.

Exclusion and Discrimination

Another significant disadvantage of Aadhaar misuse is the potential for exclusion and discrimination. With more services and entitlements mandating its usage, those without Aadhaar may face difficulty accessing them; furthermore, technical glitches or authentication failures have been reported as a denial of essential services to marginalized communities, further compounding social inequalities.

Unauthorized Access of Personal Data

Misuse of Aadhaar may include unwarranted access to personal information by service providers, companies, or government agencies for targeted advertising, profiling, or selling personal data without individual consent – activities that violate individuals’ rights while weakening trust in Aadhaar systems.

GST Frauds

The Government has mandated Aadhar-enabled verification for GST Registration, i.e., the authorized person’s identity at the time of GST Registration is established through Aadhar verification. In case of the absence of Aadhar verification, field officers have to visit the registered place for verification. There have come instances where a farmer or tea seller has been issued GST notices and demanded Crore of Rupee for GST tax evasion. On investigations, it has been found that their aadhar and pan have been misused by someone to obtain a GST Registration in their name and commit GST fraud. This has made the lives of low-income group individuals a disaster.

Penalties for Non-Linking

The mandatory linking of Aadhaar to various services and the consequent penalties for non-linking have raised a big question for the government. There have been instances where a student has to pay a Rs 1000 penalty for non-linking his aadhar with a pan card even when he has no Income and no Income tax return is required to be filed by him. Further, there have been cases where a BPL individual was denied to withdraw money from his bank account because he did not link his account with Aadhar when he needed emergency money. People are denied essential services, which are part of their right to life and have been penalized hefty money.

Consequences and Solutions

Misuse of Aadhaar can have serious repercussions for individuals, including financial losses, privacy invasion, and exclusion from essential services. To address these concerns effectively, robust security measures, strict adherence to privacy laws, and an enabling regulatory framework must be put in place to avoid unapproved access and data breaches; additionally, awareness campaigns about data protection rights should also be held to enable individuals and protect their Aadhaar information.

FAQ's

Q1. Is Aadhar mandatory for all Indian residents?

Q2. Is Aadhar data secure ?

A2. The Aadhar database employs stringent security measures and stores data in an encrypted environment.

Q3. Can Non-Resident Indians (NRIs) Apply for Aadhar?

A3. At this time, Aadhar enrollment is available only to Indian residents and is therefore ineligible for enrollment by NRIs.

Q4. What should I do if I lose my Aadhar card?

In case of loss, download another copy from the UIDAI website or visit an enrollment center for assistance.

Conclusion

While Aadhaar holds great promise to transform service delivery and enhance governance, its misuse presents significant threats to individual privacy and security. Addressing these concerns requires an integrated approach incorporating technical safeguards, legal reforms, public awareness campaigns, and technological safeguards – this way, India can strive towards creating an Aadhaar system that respects both conveniences and safeguards individual rights.

Practice area's of B K Goyal & Co LLP

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