Just think of this situation. To get an Aadhaar card one has to show proof of residence, and the passport is a valid document here. Getting a card also entails having your fingerprints registered with the government as this is then linked to other amenities like, say, acquisition of a new mobile connection. So far, so good.
Next when you go to get your passport renewed, you need to show your Aadhaar card which then completes the formality. Your fingerprints are again taken. There is police verification, which makes sense. But when the cop comes home and all members of the family are not there, you have to report at the station where he signs the final paper. Very often there can be trouble over something trivial and you pay a bribe.
Now when the government is moving towards a faceless system, why should personal verification be necessary for everyone, as one shows the same set of documents? The police do not do anything else but file the papers. In case there is something against a person then there could legitimately be a call to the applicant to present himself at the station. On the whole it is sloppy; and often if people are from lower income groups and are semi-literate there will be money to be made. One can hear rude encounters where the cop questions why the person wants to go abroad and then seeks a monetary return for filing the papers. The passport should be an automatic process where everyone pays the fees and gets it without any personal interaction based on the Aadhaar card.
Next, let’s look at the banking system. There is a rule which says that Know Your Customer (KYC) has to be done for every customer periodically. So the bank sends reminders which sound like threats as the last day approaches. What one has to do is to sign forms and show PAN and Aadhaar as proof. This is ridiculous because these two documents never change, and the same are presented repeatedly. Logically a simple affirmative click on the website should obviate the need to go back to the branch if there is no change in the KYC details.
Last, let us look at the income tax system, which now uses artificial intelligence to gather all monetary transactions of the person which is linked to a PAN number. The form, AIS, tracks everything and leaves out nothing. One assumes it is still work in progress as there are major errors on, say, mutual fund purchases which are credited to both the joint holders when it should be the first name. One assumes this will get corrected.
But a pertinent question is this. Why can’t there be a TDS on every transaction not at a standard rate of 10% but the relevant tax slab of the beneficiary? This can easily be done by a person stating her tax bracket. Just like how a person who does not have to pay tax submits a form 15H, one can always state the tax rate. This is a win-win solution for both parties. The government will get the tax on a timely basis. The taxpayer need not go through calculating the tax to make the advance tax payments, and is provided convenience.
These three examples show that while we are doing a lot on technology and making sure that things get digitised, there are large gaps in terms of tying up loose ends. The system looks at the narrow picture of “achieving something not done anywhere in the world”. But rarely do we look at following up to add to the convenience of the individual, which should be the primary goal. This is what happens when technological innovation runs faster than the ability to implement the same across the country.
The Fastag, for instance, was supposed to bring about efficiency in letting vehicles cross the toll gates seamlessly. But in a city like Mumbai it can take a horrendous amount of time at the Vashi or Dahisar toll gates where the inability of the machine to read the tag can lead to snarls, and vehicle drivers blaring their horns. Hence while the system is good for the government or the toll collector where the people manning the station cannot keep the money for themselves, the inconvenience to the motorists can be quite substantial.
The solution is to carefully draw up plans to the end point rather than look only at the creation of a technology – which is the case today. The issue is that once a technology gets introduced, there is rarely any incentive to bring about improvements. Maybe there are cost considerations, as in the case of modifications of Aadhaar there are no new cards sent and one has to download the same. In fact, finding a centre for these changes can be a challenge as most have been closed down.
Often the issues flagged with technology, especially in the financial space, is by the regulators with intensive education programmes which is creditable. Hence there are constant campaigns against being tricked into giving passwords etc on the phone. But when it comes to other amenities, there is a lot of work still to be done. The policy of faceless tax assessment is a brilliant step by the government which has addressed a serious issue, though using AI can create chaos as they can raise questions to thousands of people in case the algorithm demands so. Hence a difference of ₹1 and ₹1 crore are treated the same across all formulae attached.
The way forward is to get public views in each of these areas and have the engineers sort them out so that the loose ends are tied up. More importantly, public views should be solicited and included in the schemes because at the end of the day the user should find it convenient rather than onerous – which is the case at times today.
(The author is Chief Economist, Bank of Baroda and author of ‘Corporate Quirks: The Darker Side of the Sun’. Views are personal)
