Budget boost on cards for Nilekani’s UID

The Unique Identification (UID) project initiated by the UPA government is expected to get a massive hike in budgetary allocation for 2010-11.

The finance ministry is learnt to have approved a budgetary support of Rs 2,000 crore for the project, as against Rs 120 crore allocated this fiscal — an increase of 16 times.

Besides social sector schemes, UID is among the few government projects identified for getting such a significant hike in a year of fiscal consolidation.

The finance ministry is walking a tight rope in allocating funds to ministries and departments as it seeks to bridge the steep fiscal deficit, estimated at 6.4% (based on 2004-05 as the base year). Most ministries run the risk of either getting a minimal increase in allocation or no hike at all.

Sources said the UID project requires huge investments, estimated at over Rs 15,000 crore. However, the actual investment required for providing UID cards to 1.2 billion people is still being worked out. The front-end IT support system for the UID project itself is estimated to require Rs 4,000-5000 crore.

The Unique Identification Authority of India (UIDAI), the implementing authority for the project, plans to cover 600 million people in the next five years.

The authority is gearing up to roll out the first batch of electronic cards by August 2010 and the second batch by February 2011.
It will finalise the consulting agency for the project in a month’s time.

An empowered group of ministers headed by the then external affairs minister, Pranab Mukherjee (now finance minister), had approved the establishment of the UIDAI. Nandan Nilekani, former CEO of Infosys, was appointed its chairman in June, 2009 with the rank of a cabinet minister.