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Interviews | Varad Pande, Officer on Special Duty, Ministry of Rural Development interviewed by Samie Modak & Abhineet Kumar

Varad Pande, Officer on Special Duty, Ministry of Rural Development interviewed by Samie Modak & Abhineet Kumar

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published Published on Feb 20, 2013   modified Modified on Feb 20, 2013
-The Business Standard

Varad Pande, officer on special duty, ministry of rural development, says the Aadhaar identification project aims to cover at least half of country’s population by next year. He talks about where it has reached, in an interview with Samie Modak & Abhineet Kumar. Edited excerpts:

* What is the Aadhaar project’s status?

The project started about two years earlier and now has a little more than 270 million enrolled, roughly a fifth of the population. We have set a target of getting 600 million enrolments by 2014 and are on track to achieve that. We have enrolment capacity of a million a day and that is being used across 18 states.

We also have started this Direct Benefits Transfer (DBT) programme, in 43 districts. About 30 government schemes have already been moved to this platform. We are really pushing in these districts. We will show results and then we will cover more districts and schemes.

* For DBT, the focus is on micro-ATMs and business correspondents (BCs). Why is there no focus on mobile banking that has huge penetration?

We are still a long distance from being a cashless society. We have to be responsive to the ground reality. The bank branch network is only 30,000, for 600,000 villages. To reach every Indian who doesn’t have access to banking, BC is the model to move forward right now.

There were two problems in the BC model. One was the ‘one bank, one BC’ model, which was giving a sort of monopoly. The second was that the payment model was not attractive enough. We are trying to correct for both. The government and the Reserve Bank of India have allowed anybody to be a BC, one big change. The second is to move towards a transaction-fee model. The task force on Aadhaar-enabled payments has recommended 3.5 per cent (of the transferred amount). The government is considering that. Hopefully, there will be some decision soon. The eco-system of one million BCs with micro-ATMs is what is going to unleash the potential of this platform, both for delivery of government schemes and financial inclusion.

* Could Aadhaar also be used for electoral purposes?

The UIDAI (Unique Identification Authority of India) and the Election Commission have met and discussed this. I am not privy to the conversation. But, through Aadhaar, we are creating a platform and once you have that, it can be used for multiple things. There can be many apps built on this platform.

* Are all state governments on board for this project?

A lot of state governments across party lines are on board. You have non-Congress states like Bihar, Madhya Pradesh and Tripura which have backed this Aadhaar platform. We are getting support across party lines.Ultimately, the Centre and the states have to push this together. Thereare going to be coordination issues. We are putting in place institutional structures to address coordination concerns. This is goingto be the most important thing to get right.

There are concerns that the money received through direct cash transfer could be squandered towards wrong things by the end-beneficiary. We are not putting any additional money in the hands of people. In the first phase, we are only moving things anyway paid through cash, such as scholarships, pensions. The second phase is when you are substituting kind for cash — LPG subsidy, kerosene subsidy or even the Public Distribution System. Here, what you say is a possibility. We need to do an evaluation on whether this really happens. There is a recent study bythe India Development Foundation in Delhi and MP on this, which shows people don’t end up spending on wrong things like alcohol. My own view is that replacing kind with cash in urban areas is fine. In rural areas,you have to be a little more careful.
 

The Business Standard, 20 February, 2013, http://www.business-standard.com/article/economy-policy/aadhaar-is-getting-support-across-party-lines-varad-pande-113022000051_1.html


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