India’s Massive I.D. Program Exemplifies ‘Science of Delivery’

Terms like ‘poverty-killer’ and ‘game changer’ are heard frequently in development circles, but when used by World Bank President Jim Yong Kim and Chief Economist Kaushik Basu, they acquire an additional degree of urgency and depth.

Kim and Basu were referring to India’s digital unique identification program, and the man who runs it – Nandan Nilekani, Chairman of the Unique Identification Authority of India. 

For Kim, the ‘poverty killer’ aspect of the program is the promise of on the ground impact.  For Basu, it’s the more efficient direct transfer of benefits to the poor and vulnerable that promises to be a ‘game changer.’

Nilekani was at the Bank on April 24 to give a lecture about the governments’ ‘Aadhaar’ project, an unprecedented effort to provide 1.2 billion Indian residents with a digital proof of identity. (‘Aadhaar’ means ‘foundation’ in several Indian languages). 

Once they have an identity number, citizens will have an opportunity to participate in the formal economy, and government expenditures will become more efficient and equitable.

“Not having an identity historically wasn’t a problem in India because people stayed in their villages,” said Nilekani. “But today, this has become the source of a divide.”

Helping bridge this divide is the task of the Aadhaar project, and at the core of the project is an IT system that would have been impossible as recently as five years ago.  In the past few years, ubiquitous connectivity, drastic reductions in the prices of smart devices, and internet-based computing, which has allowed the likes of Facebook to smoothly handle one billion users, have all dramatically opened up the opportunities for using IT in interesting ways.

As happened at Ellis Island during the early days of mass immigration to the United States, Aadhaar’s system records basic information about an individual like name, age and gender.  But in a 21st century twist, it also scans fingerprints and eyes.

As a result, the system matches with 99.99% accuracy millions of names every night against the already-registered 300 million identities to ensure there are no duplicates.  Moreover, the system is a simple platform that is easily scalable and can support other applications that may arise in the future (from other government agencies, as well as the private sector), in much the way that ‘apps’ are developed around smart phones.

Registrations have been growing at breakneck speed, with 380 million residents enrolled since September 2010, when the system was rolled out, and an additional million enrollments being added each day.  The target is to enroll 600 million people by 2014.

A key pillar of the project is ensuring that everyone involved – starting from Nilekani’s own agency through to the citizen – has a stake in ensuring that the system is developed and rolled out well, and continues to do so after it is fully operational.

A total of 280 staff work in Nilekani’s agency, the sole entity mandated by the Government of India to focus on ID creation. Other public and private partners collectively make up an additional workforce of 100,000.

Seventy-five privately run ‘enrolling agencies’ help register people to the program, with the Aadhaar team using real-time data to monitor performance. Roughly 50,000 operators certified and trained by private companies capture and enter data, using devices certified by the Aadhaar team. Enrolling agencies buy this equipment from a list of certified vendors, and get reimbursed only when they successfully enroll new people.

In tandem, organizations like banks and mobile or fertilizer companies – whichever is providing a service - become authorized to use the Aadhaar system to verify citizens as needed.

In spite of the early success of the program, the true value of the exercise will really only be seen once more citizens participate in the formal economy, and start receiving better services from public agencies and business.

“Even I don’t know all the benefits that could come from this,” admitted Nilekani.

But early signs are promising.

The Indian government transfers funds to citizens through numerous pension, wage and scholarship programs. A recently introduced rural employment guarantee scheme uses a portable ATM machine administered by a bank agent and linked to the Aadhaar system to dispense wages. Hundreds of thousands of transactions have already taken place.

The system has also been used to distribute rice through 200 outlets in the state of Andhra Pradesh.

For those attending and watching online, the relevance of the Aadhaar system to the World Bank’s work and other development practitioners became immediately apparent.

President Kim thought a system like Aaadhaar could help achieve the target of eradicating poverty by 2030 in ways big and small.

“On a larger scale,” said President Kim, “we’ve got to think about how we can integrate this technology into a massive effort to scale up access to financial services.”

“On a comparatively smaller scale,” he added, “being able to keep online records of what medicines tuberculosis patients, for example, have been getting, could help us in curtailing the ability of certain strains of tuberculosis to get more and more resistant over time.”

Basu thought there were important ramifications for better tackling corruption.

“There have been leakages of up to 40% in food distribution systems across the world. If a system like this enables us to cut that figure down to 5% - and I think that’s entirely doable - the fiscal implications would be significant.”

Basu also thought such a system, by facilitating better targeting, could have a direct impact on reducing poverty, and an indirect one on growth as a result of greater efficiencies in government programs.

Questions still remain on whether the potential will be realized. One audience member flagged the costs to government agencies for having to update legacy IT systems, and another raised concerns about privacy. Nilekani himself acknowledged that the process of government reengineering is a long one that requires a lot of ‘block and tackle’ work.

However, as President Kim pointed out, the discussions are still in the early stages.

“I see this as the beginning of an institution-wide conversation about how we can make this system work for everybody. I’m not quite sure how to do it, so I’m hoping all our staff will continue to come to us with ideas on how to make this work on a large scale,” he said.

“This is the science of delivery,” said President Kim in closing. “Now, more than ever, we have to find innovations like these that have been thought through carefully, and are quickly and easily scalable.”