Technology, Aadhaar and Potential for Africa

In the past few years, the way people speak of Africa’s potential has changed. In the 10 years leading up to 2010, the six fastest-growing economies in the world have been African. Growth in these countries has accompanied the rise of more liberal markets and the emergence of industries beyond the dominant natural resource and commodity sectors.

The change that is occurring in Africa is reminiscent of what India experienced through the 1980s and 1990s as we became recognised as an economic force. Many of the challenges African nations now face remind me of the ones that India has experienced in its efforts to overcome high incidence of poverty, the growing pains of urbanisation, the challenge of job creation and the creation of effective welfare programmes

The Goals of Growth

As India has went years of development, a consensus took hold within the country that we needed to look beyond growth, and consider the impact of development on the reduction of poverty, and on the achievement of social goals such as  health and education, and on the building of infrastructure and institutions. And, as Africa experiences rapid growth, it faces similar concerns.

Developing countries in Africa and Asia face unique challenges. They see growth rates that are far more rapid compared to what the nations of the West experienced during the 19th and 20th centuries, thanks to the leapfrogging of infrastructure and technology. India, for example, has transitioned directly from no-telephone penetration to the use of mobile phones; the software industry in India emerged early in the 1980s even as India began to record impressive GDP growth rates; the rapid urbanisation and an extremely young population are bringing millions of rural poor into the cities at a breathtaking pace.

These changes are taking place at unprecedented speed, and while this has enabled growth rates of over 6 percent in much of the developing world, it has also come with challenges for governments in ensuring that their citizens, particularly the poor, are equipped with the skills and support systems to participate in growth, and are not left out. The rapid pace of growth means that countries in Asia, and now in Africa, must implement innovative solutions to meet the demands of its fast-expanding middle classes and its millions of upwardly mobile, aspirational workers.

Bringing Technology to Development

The solutions that India has adopted to meet the challenges of its growth trajectory often have at their core technology as a powerful and enabling tool. Telecom connectivity has brought mobile phone access to millions of ordinary Indians, connecting people across rural India to national and global markets. Increasingly, this mobile phone infrastructure is also being leveraged in government programmes to send alerts and information to welfare beneficiaries on the delivery of subsidised food or the deposit of wages and cash benefits into their bank accounts. The use of IT has also made itself felt in the deployment of smart cards in welfare programmes such as the Rashtriya Swasthya Bima Yojana or the National Health Insurance Scheme that provides basic medical coverage to the poor. This has pointed the way to the more widespread use of technology for better governance, and one such effort that has emerged is the unique identification number project — the Aadhaar initiative.

Aadhaar translates as ‘foundation’ in several Indian languages, and the Aadhaar number is meant to serve as a foundation for enabling better, more inclusive governance and service delivery across the country. The Aadhaar initiative, which will enrol approximately 600 million people by 2014, issues a unique identification number to every Indian resident, which is linked to the person’s unique demographic and biometric information. The demographic information collected while enrolling residents for the number is basic identifying information — name, age, gender, present/permanent address; the biometric information collected is the person’s photograph, fingerprints and iris images.

By collecting such information, the project is able to ensure that there are no duplicates of the number. Every time a new identification number is issued, the biometric information is checked against the database of existing Aadhaar numbers. The number will enable the unique identification of individuals and confirmation of their identity online and in real time. An individual can provide his/her number and a piece of demographic or biometric identifying information to any agency anywhere in the country and the Aadhaar database will confirm in a few seconds whether he/she is indeed that person.

Such identifying infrastructure is a valuable one in a country which is working to tackle poverty and improve its social indicators. It allows governments and service providers to clearly identify individuals before delivering benefits and services, thus limiting the leakages and losses that often hinder large-scale welfare programmes. It also provides the potential to directly transfer benefits to the poor in the form of cash and vouchers by linking the Aadhaar number to individual bank accounts.

The mobility of the number means that migration and urbanisation do not need to come with exclusion for the poor; services that individuals are eligible for, such as a bank account, a mobile phone connection and welfare benefits, can be accessed anywhere in the country, since identity can now be established anywhere. Governments can also identify problems of exclusion more easily, such as when a child is out of school, or has failed to receive vaccinations. The ability to confirm identity online also means that governments can expand the reach of critical services such as banking more rapidly across the country, through solutions such as mobile banking.

For Africa, the coming years may be the right time to implement technology- enabled solutions such as the unique identification number. Governments across Africa have the finances for such projects — they have seen increased revenues over the last decade, thanks to the improvement in commodity prices and economic growth. African nations are already putting in place infrastructure necessary for such technology-aided projects — they have made substantial inroads in laying the fibre-optic infrastructure necessary for online connectivity, particularly in South and East Africa. Policies in Kenya, Rwanda and Nigeria have encouraged the rise of IT and telecom industries and the spread of mobile phones. South Africa, Nigeria and Kenya together produce millions of software engineers, ensuring local expertise for IT-intensive projects; countries such as Rwanda are already implementing IT solutions in education and health care and local governments in Nigeria are experimenting with biometric-based identification.

Both the technological capability and the familiarity with the infrastructure required to build an effective identification system are thus falling in place. In addition, the expansion of banking infrastructure to the African poor — with the growth of mobile banking in Kenya, and the rise of no-frills (Mzansi) accounts in South Africa — make ID-based applications such as Micro-finance and direct welfare transfers to the poor increasingly possible.

Young Nations Coming of Age

In the next few years, Africa is set to become the continent with the world’s fastest growth rate and the fastest rate of urbanisation. It is also a region that will, like India, soon experience a significant demographic dividend, as its population moves from high to low fertility rates. As the region’s one billion people gain a younger, more ambitious tilt, African governments will have to respond with better, more effective programmes that meet the growing demands for jobs, better services and effective infrastructure.

Technology will be a powerful tool for governments to respond rapidly and quickly to these demands. It will enable them to track progress in development efforts, inform citizens and gain feedback on their efforts, even as they build the roads and institutions that are necessary to support long-term growth. Africa is now on track for rapid development. Technology-based solutions would be a means to ensure that such growth progresses on a path that is sustainable, and inclusive.

(Nandan Nilekani is Chairman, Unique Identification Authority of India, and author of many best-selling books, including Imagining India)

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Nandan Nilekani