04 July 2017 13:17:02 IST

A management and technology professional with 17 years of experience at Big-4 business consulting firms, and seven years of experience in high-technology manufacturing, Rajkamal Rao is a results-driven strategy expert. A US citizen with OCI (Overseas Citizen of India) privileges that allow him to live and work in India, he divides his time between the two countries. Rao heads Rao Advisors, a firm that counsels students aspiring to study in the United States on ways to maximise their return on investment. He lives with his wife and son in Texas. Rao has been a columnist for from the year the website was launched, in 2015, and writes regularly for BusinessLine as well. Twitter: @rajkamalrao

Is the government becoming too addicted to Aadhaar?

Most big democracies have refused to authorise universal fingerprinting fearing malicious use

Not a week passes by without the government imposing some new Aadhaar-related rule. Last month, the Supreme Court agreed with the Central Board of Direct Taxes that the rule requiring taxpayers to provide Aadhaar numbers on tax returns complied with the law. And now banks are insisting that Aadhaar information is mandatory to open new accounts, perform transactions of over ₹50,000 or engage in international transactions.

These mandates are quickly becoming the modern equivalent of Cold War era rules of carrying identification papers and having the freedom of movement be subject to the whims and fancies of soldiers at a checkpoint. Worse, there appears to be little restraint as the government asserts its power of collecting biometric data as power it has always enjoyed under the Constitution.

Arguing in front of the Supreme Court to request expanded powers to force taxpayers to reveal Aadhaar information on tax returns, India’s Attorney General Mukul Rohatgi reportedly said “taking fingerprints and iris impressions for Aadhaar is not an invasion of a citizen’s body as the right of a person to his own body is not absolute.” This remarkable statement is the kind of sentiment that prompted Lord Acton to issue a warning in 1887 that “power tends to corrupt, and absolute power corrupts absolutely.”

The legal framework for Aadhaar is based on the 2016 Aadhaar Act. The purpose of the Act is rather narrow: “to provide, as good governance, efficient, transparent, and targeted delivery of subsidies, benefits and services, the expenditure for which is incurred from the Consolidated Fund of India.”

The Act’s focus clearly is on delivery of subsidies and benefits such as monthly disbursement of pensions or an LPG subsidy. The goal is commendable: to improve efficiency and reduce fraud, waste, and abuse when the government spends taxpayer funds.

New rules

But how, pray, is opening a bank account consistent with the goals of the Aadhaar Act? No treasury funds are being expended, no benefits are being disbursed, no subsidies are being claimed.

Why is the Aadhaar card now mandatory on tax returns when PAN numbers did fine until now? True, there are millions of Indians with duplicate PAN numbers, most of them obtained for fraudulent purposes, but the government says that it has already cancelled 10 lakh duplicate PAN cards by linking the Aadhaar and PAN, addressing nearly 95 per cent of the population.

The fact is that nowhere in the 18-page Aadhaar Act do the words “Bank” or “Tax” even appear. The government is clearly finding new uses for Aadhaar that are inconsistent with the Act’s original goals stated just a year ago. This is dangerous. We leave fingerprints everywhere we go. A bad actor could capture our prints, summon Aadhaar credentials from the UIDAI database and use this information for malicious gain. Not everyone in our government has profiles as compelling and righteous as our PM or Finance Minister, leaders who have been relentlessly pushing for the use of Aadhaar beyond its original intent.

Malicious intent

Consider a corrupt government official who holds his rivals to silence because he has built files of their actions — such as an indiscreet visit to a nightclub — obtained through Aadhaar verification based on fingerprints left behind on a glass. Sounds far-fetched? Hardly. J Edgar Hoover, the famous Federal Bureau of Investigation (FBI) Director in the United States, used FBI agents to compile private dossiers about presidents, including JFK, and continued to stay in power for 37 years by blackmailing anyone who confronted him.

It was Hoover who built the FBI into the powerhouse that it has since become. And after Hoover’s death, Congress passed laws restricting government officials from using the FBI for political and personal gain, statutes that will likely be under close scrutiny in the new special counsel investigation of Russia’s potential interference in last year’s US elections.

This is why big democracies have refused to authorise universal fingerprinting even in a post-9/11 world. While most countries use biometrics for homeland security considerations, such as for passports, the use of biometrics for purely civilian purposes such as tax returns and bank accounts has never been allowed. The reasoning is that while there may be benefits of using biometrics for these too, the civil libertarian and privacy risks are overwhelming. Data breaches are real and the simple truth is that what doesn’t exist cannot be stolen or abused. This is why, in the US, fingerprints are required only of government employees (who have access to government secrets), accused criminals and foreign visitors. And when an accused is deemed not guilty by a court of law, the FBI is required to delete the person’s prints forever.

Immediate intervention

Using efficient governance and anti-corruption objectives as excuses, the Indian government is taking us in a direction opposite to the world’s free societies. Because everyone needs a bank account in a society which is slowly going cashless, the proposed banking rules force everyone to obtain the Aadhaar card — even those who have conscientious objections to having their most private information (information about their very bodies) available to complete strangers.

The Supreme Court should immediately intervene about the bank requirement and as a policy, issue a blanket order invalidating the vast, draconian, overreaching vision of Rohatgi. Further, the Court should restrict the Aadhaar card’s use to the original purposes stated in the Act. As a growing world power, we deserve nothing less.