Tag: Aadhaar

NRI Diaries: Day 1

So I arrived in Bangalore this morning, after nine months in London. This makes this my first visit to India as a “Non Resident Indian” (NRI), and since foreign papers quite like getting opinions of India from NRI observers, I thought it makes sense to document my pertinent observations. I should mention upfront, though, that nobody is paying me for these observations.

The day began after a very short night’s sleep (we went to bed at 11 pm British Time and woke up at 7:30 AM India Time, a total of three hours) with a visit to one of our favourite breakfast establishments in Bangalore – Mahalakshmi Tiffin Room.

It was the daughter’s first ever auto rickshaw ride (back when we lived here we had a car and she was really tiny, so didn’t need to take her in an auto). She seemed rather nonchalant about it, occasionally turning her head to look outside. The auto ride cost us Rs 30. We gave Rs 100 and the driver asked us if we didn’t have change. Living outside makes you unlearn the art of change management.

We got our usual table at MLTR and were greeted by a rather usual waiter plonking three glasses of water on our table. We politely declined and requested for Bisleri.

After breakfast, it was time to get connected. I went to a medical shop near my home which I knew offers mobile phone top up services. Topping up the wife’s phone was rather straightforward, though it took some time given the crowd. During my fifteen minutes at the medical shop, at least six people came requesting for mobile phone top ups. Only two came asking for medicines. India seems to be getting healthier and wealthier.

Airtel decided to reassign my number to someone else so I needed a new SIM. I asked the medical shop guy for a Reliance Jio SIM. He spent ten minutes trying to log in to his Jio vendor app, and I gave up and took my business elsewhere. This elsewhere was a really tiny hole in the wall shop, which had a fingerprint reader that enabled the issue of a Jio SIM against Aadhaar authentication. The process was a breeze, except that I consider it weird that my mobile number starts with a 6 (the number I lost was a 9845- series Airtel).

Waiting at the hole-in-the-wall also made me realise that standing at shopfronts is not common practice in London. Thanks to high labour costs, most shops there are “self-service”. It’s also seldom that several people land up at one shopfront in London at the same time!

Losing my old number also meant I had to update the number with banks. I started with State Bank of India. The process was rather simple – took no more than 2 minutes. While at it, I asked about Aadhaar linking of my bank account there. There seems to be some confusion about it.

For example, I heard that if you have multiple accounts with the bank, you should only link one of them with Aadhaar – which defeats the purpose of the exercise, if one exists! Then, joint accounts need only one Aadhaar number to be linked. The linking process also differs based on who you ask. In any case, I encountered one rather helpful officer who completed my Aadhaar linking in a jiffy.

Then, my book is launching tomorrow which means I needed to buy new clothes. I landed up at FabIndia, and as is the practice in forin, I kept saying “hi” and “thank you” to the salespeople, who kept muttering “you’re welcome, sir”. While at it, the missus discovered that FabIndia now has rather explicit sales targets per store, which possibly explains why the salespeople there were more hands on compared to earlier.

Later in the evening, I got a haircut and a head massage. The last time I visited this salon, it was called “noble” (a rather common name for haircutting shops in Bangalore. Like Ganesh Fruit Juice Centres). Now it’s called “nice cuts”. The head massage was fantastic – I miss this kind of service back in the UK. I also borrowed the inlaws’ car and drove it around and even managed to parallel park it – nine months of no driving has done no harm to my driving skills.

Hopefully I’ll have more observations tomorrow.

The real benefit of direct benefit transfer

A week ago, I gave up. My LPG subsidy that is.

Having been out of the country for a few months, with our normal LPG usage being much lower than the average family’s, and having forgotten to book my spare cylinder, my LPG account had been “suspended”, for not booking a refill for over six months.

Back in the day when all domestic LPG connections were subsidised, you were required to book a cylinder every six months, else your account would get suspended. This was a measure to get rid of fake accounts and duplicate connections owned by a family (a family could have only one connection, legally).

So when I went to my dealer last week asking for my account to be unsuspended, I was told to submit my Aadhaar number to get it released. When I said I don’t have an Aadhaar number (I have one, but don’t want to use it unless mandatory), the clerk asked if I could give up my subsidy. With the LPG subsidy being a minuscule part of my overall annual expense, I quickly agreed, and after filling up a form and submitting a copy of my driving license, I had “given up”.

Later that day, my account was unsuspended, and I could presently book a refill, which arrived today. And having “given up”, there is no compulsion now to book a cylinder every six months!

The real benefit of the direct benefit transfer scheme adopted by the union government for LPG subsidy transfer is that it is now possible to have two classes of LPG connections, with several benefits.

Firstly, rules such as minimum and maximum frequency of booking don’t apply any more. Secondly, and more importantly, it is far easier nowadays to get an LPG connection – someone I know went to a nearby dealer to get a connection, and after submitting basic identification documents and paying a deposit, it took only a couple of days for the cylinders to arrive.

You might recall a campaign in the late 2000s by the then Karnataka Energy Minister Shobha Karandlaje to weed out duplicate LPG accounts in order to prevent wasteful subsidy. That brought in a regime of submitting a copy of an electricity bill to get LPG connections, in order to prevent one household from having more than one connection. Consequently, getting a new LPG connection became an absolute nightmare.

With the benefits now being targeted, and Aadhaar based, getting a new LPG connection is mostly straightforward, as long as you don’t claim a subsidy. And a lot of the times, the value of the subsidy is far lower than the additional cost of getting the cylinder itself!

In the earlier “indirect transfer regime”, this class of unsubsidided LPG connection did not exist (unless you went with one of the private sector players, most of whom have remained undependable), causing much harassment to consumers, and the need for various workarounds.

The direct benefit regime has thus not only saved the government the cost of wasteful subsidies, but also made life easier for consumers by making the market more rational!

Biometrics for Aadhaar reflects a lack of social trust and law enforcement

As far as I’m concerned, the primary purpose of Aadhaar is for targeting subsidies. Right now we have a regime where subsidies are targeted on a household basis, which is incorrect and inefficient. What we need is a methodology to target subsidies to individuals, and for this purpose, we need a way to uniquely identify individuals.

Hence, we need a unique identification mechanism. The problem with existing IDs, such as the passport, driving licence and permanent account number (PAN) is that there is no guarantee of de-duplication. There is nothing that prevents one individual to hold multiple of these – though it might be illegal to do so. There is no formal mechanism of de-duplication in any of these – and the rather unstructured form of Indian names and addresses means that it is going to be extremely difficult to weed out duplicates of these at scale.

This is only my conjecture, but this might be the reason why the government decided to create a completely new ID, which one could obtain only if one were to give their biometric details. The argument here is that biometrics uniquely identify a person, though there are counterarguments to this which argue that it is possible in extremely rare cases (which is not rare enough, given India’s size) for two people to have biometrics that are considered identical by the de-duplication system.

India is not the only country to have aspired to issue a unique identity card for its residents. What sets India apart is the size and the fact that sharing of biometrics with the issuing agency is a necessary condition for issuing the ID card. That we have to resort to a system based on biometrics is a reflection of both the lack of social trust and the lack of law enforcement in India. That we have lack of social trust is indicated by the fact that people aspire to hold more than one “unique identity proof” – such as a PAN or a driving license or a passport. That we have weak law enforcement is indicated by the fact that existing punishments for holding duplicate IDs is not deterrent enough for people who aspire to hold multiple cards.

It can be argued that using biometrics to ensure that each resident has only one ID is an engineer’s solution to a policy problem. It is an admission of the fact that our legal enforcement is too weak to enforce unique IDs without a technological basis. It is sad that we had to go down this route without exploring policy solutions first (or maybe we did, and they didn’t go anywhere).

Gas credits and trading

So last week the government took a decision to increase the number of subsidized gas cylinders per family from nine to twelve per year. People say it is a move aimed at the elections, but it doesn’t impress me. It doesn’t impress me because it doesn’t affect me.

We are a family of two (wife and I), and have a subsidized gas connection. We cook at home daily, but since it’s just the two of us and we’re a “DINK” (double income, no kids) family, we don’t end up using all that much of gas. We use the cylinders strictly for cooking purposes only (not for heating water or running our car), and in the last three years or so when we’ve lived together we’ve averaged about three cylinders a year.

Given that we use only three cylinders a year I’m pissed off that the government has increased the subsidy from nine to twelve cylinders a year! Earlier, subsidy for six cylinders that I was getting was going waste, and now subsidy for nine cylinders is going waste! I don’t like it.

The only statistics that are out about the number of gas cylinders people use is that 90% of the population uses 9 cylinders or less a year, and 97% of the population uses 12 cylinders or less (numbers from a TV debate on the topic I watched last week). What we don’t know is the average number of cylinders consumed by a household with subsidized connection.

Given that I’m not availing of most of my subsidy, I should be allowed to trade in my subsidy for something else – subsidy on petrol maybe? If a family that belongs to the 3% that uses more than 12 cylinders a year, we should be able to strike a deal so that some of my unused subsidy can be channeled to give that family additional subsidy! This is just like carbon credit trading happens – where carbon efficient companies can sell pollution rights to companies that emit more CO2.

If you realize, what I’m getting at is that I don’t want to be “punished” (in terms of lesser subsidy) because I use less gas than the average Indian household. I want the same subsidy, too, so what if I use less gas? Perhaps the subsidy can be given in the form of an unconditional cash transfer?

While on the topic, it is absurd that LPG and all other rations are at the household level, and not individual level. We use only 3 cylinders a year because we are a family of two. Why should we get the same amount of subsidy as (let’s say) a family of twelve? Given that soon we will have universal coverage under UID, the LPG subsidy regime can be modified as follows.

Each individual (from a newborn baby to an adult) will be eligible for two subsidized LPG cylinders a year. For every LPG connection you have, multiple Aadhaar numbers will be attached – this is the list of “dependents” on that particular connection, and the total subsidy is the number of Aadhaars attached times two. Notice that the reason we have the present subsidy regime is that the Aadhaar is a necessary condition for moving to a per capita subsidy regime! Just goes to show how public services can be completely reformed once Aadhaar gets implemented.