India's vaunted tech savvy is being put to the test

this week as the country embarks on a daunting

mission: assigning a unique 12-digit number to
each of its 1.2 billion people.

The project, which seeks to collect fingerprint and
iris scans from all residents and store them in a
massive central database of unique IDs, is
considered by many specialists the most
technologically and logistically complex national
identification effort ever attempted. To pull it off,
India has recruited tech gurus of Indian origin
from around the world, including the co-founder
of online photo service Snapfish and employees
from Google Inc., Yahoo Inc. and Intel Corp.

The country's leaders are pinning their hopes on
the program to solve development problems that
have persisted despite fast economic growth. They s
ay unique ID numbers will help ensure that
government welfare spending reaches the right
people, and will allow hundreds of millions of
poor Indians to access services like banking for
the first time.

Critics question whether the project can have as
big an impact as its backers promise, given that
identity fraud is but one contributor to India's
development struggles. Civil-liberties groups say
the government is collecting too much personal
information without sufficient safeguards. The
technology requires transferring large amounts of
data between the hinterland and an urban

database, leading some to question whether the
system will succumb to India's rickety Internet
infrastructure.

The sign-up effort is already under way in a
handful of districts, and Prime Minister
Manmohan Singh is expected to kick off
nationwide enrollment Wednesday. The
government hopes to issue the first 100 million
unique ID numbers by March and 600 million
within four years. The undertaking is the latest
chance for India to show it can pull off a massive
project after what is widely viewed as its
mishandling of next week's Commonwealth Games
in New Delhi, where infrastructure and hygiene
issues led some nations to threaten withdrawing.

To lead the program, Mr. Singh picked Nandan
Nilekani, former CEO of Infosys Technologies
Ltd., which helped pioneer India's low-cost
offshore model of technology services. A native of
Bangalore, India's tech hub, and son of a textile-
mill manager, the 55-year-old billionaire is trying
to infuse some of Infosys's efficiency into a
lumbering bureaucracy.

"You have a whole mass of people who are shut
out of society," Mr. Nilekani says. "A lack of
identity is a big source of exclusion. You're giving
them a key to social services."

In one early registration drive in Nagaram, a village
30 miles outside the southern city of Hyderabad
SEPTEMBER 29, 2010
India Launches Project to ID 1.2 Billion People

By AMOL SHARMA
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in Andhra Pradesh state, dozens of people were
streaming into a drab government office one
recent afternoon to have their fingerprints taken
and irises scanned. Many applicants, who ranged
from vegetable and rice farmers to real-estate
brokers and shopkeepers, had never used a
computer much less seen biometric equipment.
Local officials had knocked on their doors the
night before to tell them about the program.

Salekula Anjaiah, a 44-year-old farmer who earns
about $40 per month for his family of five, said he
hoped the IDs would keep people from cheating
the welfare system and getting food rations they
don't qualify for. "It will take fraud out of the
government schemes," said Mr. Anjaiah, who relies
on subsidies to feed his family. "Then it will be
guaranteed I get what I deserve."

India has been attempting to improve governance
through technology for two decades. Programs
have digitized land records, created Web portals
for government agencies and computerized tax
filing systems. But the unique ID program, dubbed
"Aadhaar," or "foundation" in Hindi, is by far the
largest and most ambitious effort. Many countries
have some form of national ID and a handful use
biometrics, but none come close to matching the
scale of what India is attempting.

Mr. Nilekani started recruiting Indians in the
global technology industry in the summer of
2009. These early recruits included Srikanth
Nadhamuni, who had spent 16 years as a
technology engineer for companies like Sun
Microsystems and Intel.

Word spread in Silicon Valley that Mr. Nilekani
wanted help, and by the fall a few others arrived in
Bangalore.

The team rented an apartment at a gated
community on the eastern outskirts of the city to
use as an office. Everyone worked for free.

The group worked in the living room. They
bought a few tables, two whiteboards and some
markers. For food, they went to Mr. Nadhamuni's
house nearby, where his wife served rice cakes,
lentil crepes and lemon rice. Visitors had to use a
wooden shoe rack as a bench since there weren't

enough chairs.

The team came up with a plan to capture a mix of
biometric informationdigital photos,
fingerprints and iris scansas well as names,
addresses, genders and dates of birth. Since they
knew they wouldn't have a second chance to
collect the data, the engineers say they erred on
getting too much information, including all 10
fingerprints instead of just one. The government
would issue the random 12-digit numbers by
mail. Passports, driver's licenses, ration cards and
government health-insurance cards could either
have the numbers printed on them or embedded
electronically.


Bloomberg News

Project head Nandan Nilekani says 'a lack of
identity is a big source of exclusion' in India
today.

That still left a major hurdle: How to verify that a
number and a person actually match? Retailers,
like banks and cell-phone companies, could install
fingerprint readers and match the data over the
Internet. But getting readers and Internet access to
the 500,000, often remote locations where
subsidized food is distributed to the poor would
be costly and impractical.

The Indian government is expected to spend as
much as $250 billion over five years on programs
aimed at the poor, including subsidies for food,
diesel, fertilizer and jobs. But 40% of the benefits,
as the system now stands, will go to the wrong
people or to "ghosts" with fake identification
papers, according to a report by brokerage firm
CLSA Asia-Pacific Markets. Today's ration cards,
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for example, are issued on paper, and are relatively
easy to forge or doctor.

In November 2009, Mr. Nilekani wrote to tech
companies such as Intel, Google, Oracle Corp. and
Yahoo, asking them to send Indian-origin
engineers to contribute to the cause, either on
paid sabbatical or as volunteers. More than 20
people joined the effort.

The government has approved about $670 million
for the project so far, and the entire cost will
likely be "several billion dollars," says Mr.
Nilekani.

By early this year, the Bangalore team moved into
a real office at a technology park. Mr. Nilekani
became a traveling salesman for the project, taking
a PowerPoint presentation on the road and making
the case for unique IDs with government agencies
and regulators across the country.

In his pitch, Mr. Nilekani focused in part on
reducing fraud, but also on the potential for
bringing into the financial system the roughly
two-thirds of Indian adults who don't have bank a
ccounts. The poor often have few or no
documents to prove who they are or where they
live. The unique ID would solve that problem, says
Mr. Nilekani, and could be linked to banks' plans
to offer "no-frills" accounts, with no minimum
balance and low fees, as well as nascent money-
transfer services via mobile phones.

In the village of Nagaram, officials say they have
been signing up 200 people per day, and as of
early September, had made it through half of the
4,500 residents. The goal is for hundreds of
villages and towns in Andhra Pradesh to start
enrollment soon, and to reach 30 million people
state-wide by the end of the year.

Signing up is technically voluntary, but any
government agency or company will be allowed to
require a unique ID as identity proof, an approach
critics say amounts to a de facto mandate for
people to enroll.

The process is slow going, taking anywhere from
15 to 30 minutes per person. Capturing iris scans
with binocular-like devices is tricky and can take

several minutes. Administrators had to hold one
elderly man's eyelids open to get a good image.

In addition to biometrics, residents provided an
array of personal information, including their
caste, religion and cellphone number. State a
gencies and companies who register people can
gather whatever information they deem
appropriate.

Such vast data gathering rankles privacy advocates
who say demographic details can potentially be
used to discriminate in the services that
companies offer customers or government
agencies offer citizens.

Another concern is that marketers will find ways
to build profiles of people based on how they use
their IDstracking where people bank, which
hospitals they have checked into and who their
cellphone providers are, for example.

"You will basically be creating these wonderful
resources for people to mine," says Sudhir
Krishnaswamy, a law professor at the National
University of Juridical Sciences in Kolkata.

Mr. Nilekani says he has drafted legislation to
address the concerns of critics. Under the bill,
which has been approved by India's cabinet but
must still be passed by parliament, the
government would have to ensure that the
information it collects "is secured and protected a
gainst any loss or unauthorized access." Anyone
who discloses private information or hacks into
the ID database would face up to three years in
prison and stiff fines. Mr. Nilekani said India also
needs a broader privacy law.

Andhra Pradesh officials say early data already
show how unique IDs could reduce corruption at
the state's 43,000 ration shops, which distribute
subsidized food to the poor.

At one shop, records showed rations were being
delivered to 330 families, but after the IDs were
rolled out, only 203 families claimed benefits by
placing their finger on a scanner at the shop. State
officials suspect the shop owner had been making
up fake accounts to divert some of the food into
the black market.
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Jejjayila Venkatesh, a 35-year-old Nagaram
resident who earns $50 a month in a local
government job, said he isn't concerned about
privacy. He just hopes the ID will help him open a
bank account and get a driver's license, which he
has had difficulty obtaining thus far, and maintain
his benefits when he goes out of state for work:
"This will help me prove my identity wherever I
roam."

Write to Amol Sharma at amol.sharma@wsj.com


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