The International Monetary Fund has said that India should ensure privacy and security controls while implementing biometric identification programmes like Aadhaar.

In its Fiscal Monitor report on digital government, the organisation said that India’s biometric identification programme and electronic payments had helped reduce leakages in Liquefied Petroleum Gas subsidies. “With more than 1.2 billion registered citizens in India’s biometric identification system, Aadhaar, the country stands out as a leader in this area,” the report said.

However, the report expressed concerns about the alleged leakage of Aadhaar data. “In a recent data breach in India, it has been reported that 135 million Aadhaar numbers were compromised, underscoring the importance of sound privacy measures,” the IMF said.

“In India, privacy and security concerns have led to alternating periods of mandatory and non-mandatory use of Aadhaar in social programmes,” the report said. “A court decision is still pending on the programme’s compliance with the right to privacy.”

“Advocates of the system assert that Aadhaar is compatible with the right to privacy because the captured biometric traits are encrypted,” the IMF added. “However, the lack of sufficient security controls makes the system vulnerable to unauthorised access.”

The IMF report said that the cost of Aadhaar implementation and maintenance between 2009 and 2017 was $1.25 (Rs 81) per card. However, it added that this was lower than the cost of electronic identification systems in other countries.

The report added that the government may find it difficult to phase out Aadhaar in future given its broad coverage, notwithstanding the Supreme Court verdict in the case.