Context: Revise Aadhaar law to sync with personal data protection act

Source: The Hindu

Ashwini Vaishnaw, the Union Minister of Electronics and Information Technology, requested that the Unique Identification Authority of India (UIDAI) draft a new Aadhaar law that complies with the 2023 Digital Personal Data Protection Act. There was no universally applicable horizontal privacy law in place when the Aadhaar Act was implemented in 2016. The Digital Personal Data Protection Act of 2023 is now in effect, and its regulations are nearly complete.

In addition to providing fines for data breaches or leaks, the DPDP act lays out requirements for businesses and government agencies to secure citizens’ personal information.

Model Question:

“Aadhaar has become a critical tool for governance and service delivery in India, but its use raises concerns over privacy and data protection. In light of the Digital Personal Data Protection Act, 2023, critically examine the benefits and challenges associated with Aadhaar-based systems.”

Model Answer:

Aadhaar, launched in 2009, is the world’s largest biometric ID system. It is widely used for identity verification, welfare delivery, and financial inclusion. However, the extensive use of Aadhaar has also led to debates on privacy, surveillance, and data security, especially after the landmark Puttaswamy judgment (2017) which recognized privacy as a fundamental right.

Benefits of Aadhaar-Based Systems

1. Efficient Welfare Delivery: Aadhaar has enabled Direct Benefit Transfers (DBT), reducing leakages and improving targeting in schemes like LPG subsidy, PDS, and MGNREGA.
2. Financial Inclusion: Enabled the opening of Jan Dhan accounts through e-KYC and digital onboarding.
3. Digital Governance: Aadhaar is central to India Stack and platforms like DigiLocker, eSign, and Aadhaar Enabled Payment Systems (AEPS).
4. Cost Saving: UIDAI claims savings of over ₹90,000 crore by eliminating fake beneficiaries.

Concerns and Challenges

1. Privacy and Surveillance: Centralized biometric database raises fears of mass surveillance and profiling.
2. Exclusion Errors: Authentication failures have led to denial of welfare benefits to vulnerable populations.
3. Data Breaches: Several reports of Aadhaar data leaks raise concerns about weak cybersecurity.
4. Lack of Consent & Awareness: Citizens often unaware of how their data is used or shared by private entities.

Digital Personal Data Protection (DPDP) Act, 2023 – A Safeguard?

Key Features:

1. Consent-based data processing
2. Right to correction, erasure, and grievance redressal
3. Creation of a Data Protection Board
4. Applicability to both public and private data fiduciaries

Criticism:

1. Wide exemptions for the State in the name of national interest.
2. Lack of independent oversight and judicial review.
3. Over-centralization and vague terms like “deemed consent”.

While Aadhaar plays a vital role in digital governance and welfare delivery, it must be complemented by a robust data protection framework. The DPDP Act 2023 is a step forward, but its effectiveness will depend on implementation, transparency, and balancing citizen rights with state interests. Safeguarding data privacy is key to building public trust in digital infrastructure.