4th Smart Card Tech India 2004

National ID cards present big opportunity for business

Geetanjali Wadhwa & Pradeep Chakraborty

NEW DELHI -- The creation and issue of electronic national identity cards presents a huge business opportunity for Indian enterprises in providing the expertise, positioning of biometrics data on the cards, manufacturing and distributing machines to read these cards, storage and access to the national database and other aspects, said Hon'ble S. Regupathy, minister of state for home affairs, at the recently held 4th Smart Card Tech 2004 international conference organised by Exhibitions India in the capital.

Focusing on national identity instruments for the citizens of the country is a very important aspect in these days of terrorism, militancy and infiltration by foreign elements intending on destabilizing governments and even countries. The question remains how to identify infiltrators. Regupathy said, "We must issue identity cards to Indian citizens so that, in future, infiltrators could be known without too much fuss." A pilot scheme based on the multi-purpose national ID Card (MNIC) is currently in progress.

Dismissing all doubts regarding the ability of the government to issue a billion multipurpose identity cards to citizens, the minister said that the use of electronic voting machines in the entire election process had boosted the self-confidence of the nation. "This experience strengthens our confidence that the job can be done," he added. However, he cautioned that no other country in the world had attempted such an exercise on such a large scale so far.

The multipurpose national ID cards would have to be a national task in which the public and private sectors must join hands. Only a partnership model would enable such a huge task to be undertaken and finished within a short time frame. The private sector should realize this as a great business opportunity. "We need the expertise in India on making of these cards, the etching of biometrics data on them, and making them completely fool proof. We also need machines to read these cards and check them against the national database," the minister added. According to him, once this entire process has been successfully implemented, the national security environment is bound to improve tremendously.

Pilot project generates enthusiasm
Delivering the keynote, Kanwar Pratap Singh, additional secretary - border management, ministry of home affairs said the conference's timing could not have been better. He advised that the pilot project in preparing and issuing multipurpose national identity cards had revealed great enthusiasm among the people. The pilot project has so far covered 3 million people. He added: "We've also been able to cover 75 percent of the population in terms of finger printing and photography. In some areas, it has been over 85 percent. People have been seen queuing up from early morning for finger printing. This compared favorably when we consider that the public response to the voter-identity cards, even in urban areas, was very poor." He expected the database work of citizens in the pilot project area to be completed in two to three months and will immediately be available centrally.

A unique number will be given to each citizen. Singh said: "It is necessary for a project of this dimension to provide first rate security. Its uniqueness must be maintained. Data on smart cards is bound to increase as it is used more. India being a price sensitive market, cost could be a deterring factor. Therefore, the card should not be costly. Larger numbers will provide economies of scale. Capacities of such dimensions are not readily available off-the-shelf and will have to be created in India and/or abroad." He hoped that the whole process is completed in one go to cover the entire population over the next 12-18 months. Over 5,000 centers for data integration would be made available and more data would be added as the project progresses. He assured that a public-private partnership would be promoted for the national ID cards, which would be cost effective.

Jayant Kumar Banthia, the registrar general and census commissioner of India, said the conference aimed to meet different objectives of security through technology, and the facilities of e-governance provided through a citizen's identity. He said: "Security will be when every citizen has a fool proof national identity card. It will make security easier and facilitate delivery of e-governance to citizens. This exercise is a serious step to set up a unique database in the country."

The special significance of this project was the creation of a national register of citizens and allotting a unique identification number for every citizen. This number would help identification for delivery of other government services also, apart from helping national security by isolating infiltrators. The ongoing pilot project was to create a database of 3 million people in 13 states in the border areas. Banthia said: "This is a huge initiative. If we can create a win-win situation for everyone, we would like to bring out a model where the Indian industry takes and picks up the challenge, so that the Indian government does not have to look beyond India for various products, applications and services."

Earlier, welcoming the hon'ble minister, speakers, delegates and other participants to the 4th Smart Card Tech India, Prem Behl, managing director, Exhibitions India Pvt. Ltd., said the event explored business opportunities for everyone concerned. "We have assembled people working in different areas of this technology to discuss several issues. One issue is that of privacy, and how to protect the individual if all the information is available in one card. There are issues concerning encryption as well. We are here as catalysts to encourage pro-active decision making and to initiate actions."

National ID card as an e-government enabler
Chairing the first session, a panel discussion on "National ID Card as an e-Government enabler," R. Chandrashekhar, joint secretary (e-governance), ministry of communications and IT, said the issue of multipurpose national identity cards would help the government in effectively targeting, and ensuring welfare measures to the beneficiaries. Though National ID cards would be issued for security reasons, there was the benefit of other services from them also. However, there were "monumental problems" in creating and verifying a national database of citizens, providing authenticated access to it, keeping it in a secure environment, updating it and protecting the privacy of the citizens regarding the data available in it.

"E-governance is a buzzword today. Various state governments have articulated and stated its priority. The last ten years have witnessed implementations of various projects. In Andhra Pradesh today, several services are being offered across the counter. As these projects move forward, we need to expand and integrate them. This is where the whole plan and picture comes into the agenda," Chandrashekhar added. The optimal way to maintain and update the national ID card database would be to use it for multiple purposes. The challenge, therefore, before the public-private partnership would be to build and grow many different services.

Dr. Ajay Dua, director general, Employees State Insurance Corporation (ESIC) said that statistically 70 percent of the industrial workers in India did not change jobs. He raised the issue whether it was necessary to provide a separate smart card to ESIC members. He stressed the need for one card that served as a citizen card, to be used in the PDS (public distribution system), linked up as a driving license, and with a provision for medical and insurance records etc. He said the national ID card could bring about transparency and accountability, provide uniform identification for every citizen of the country, and could weed out the problem of illegal residency of other country nationals, staying to compromise the security of our country. Biometric identification should be an essential ingredient in the card, Dua added.

Rajeev Talwar, commissioner cum secretary, transport, government of Delhi, highlighted the crucial requirements of accurate and efficient vehicle registration. "For all the records to be included in the card, there is a need to determine the type of card readers, the O/S to be used, and the storage capacities in the cards." He called upon the industry to provide a solution where the department could deliver a system for the benefit of the citizens at the earliest. "We have to be allowed to set up efficient structures," he noted.

V.V. Rajasekhar, chief information officer, ITC Ltd., shared ITC's e-Choupal experience with the rapt audience. It is a win-win business model that has created a unique infrastructure leading to a profitable rural transformation, he said. The 'e' in e-Choupal enables the change in the paradigm, to 'break the vicious cycle' and kick-start the 'virtuous cycle of development'. Virtual aggregation brought the power of scale to the small farmers. The ITC e-Choupal linked markets and producers efficiently and created new value for all the stakeholders. It reached multiple locations cost-effectively. A customized delivery solution was made possible because of digital/ICT technologies. He added there were 4,100 e-Choupals currently in six states covering 25,000 villages and 2 million farmers. Of these, 3,000 e-Choupals were running on VSATs. Six e-Choupals were being added daily. "We would like to add 20,000 e-Choupals in 15 states covering 100,000 villages, servicing 25 million farmers (by 2010). There would be a larger range of agriculture commodities covered (adding spices, horticulture, cotton, etc.). Besides, there would be retailing and a variety of goods and services (education, health, entertainment, e-governance, resource development initiatives, etc.) as well," he added.

Wim Tappij Gielen, vice president, Europe, Middle East, India and Africa, Datacard Ltd., said that 9/11 and terrorism had led to a rethinking of new schemes, and many countries were now considering issuing smart ID cards. Multifunction smart cards had already been issued in some countries. Finland was a pioneer, as was Malaysia. "The quality of the card will decide whether the carrier is the real owner. The quality itself should not be compromised by costs alone," he added.
Sanjeev Shriya, managing director, Smart Chip Ltd. pointed out in his presentation that the creation of the national ID card and the national register will go a long way in providing e-governance services, and will enable a G2C infrastructure. "If a citizen takes pride in the card he or she holds, implementation will be easy. The card needs to be seen in the context of a lifecycle. It must be used continuously and should have a medium of transaction that is irrefutable. If the user uses the card multiple times, the database would be constantly updated and multiple service models would become available," he noted.

Smart card as an e-ID card
The second session focused on the smart card as an "e-ID: legal, business, standardization and deployment issues." Heinz Lanner, senior manager, business development, business unit security, Infineon Technologies, touched on secure chip cards as the basis of a national e-ID. According to Gartner, Infineon continued to be the largest supplier of silicon to the chip card industry in 2003. He touched upon government-driven e-ID card projects with Infineon products for the national ID, as well as government-driven e-ID card projects with Infineon products for health care and social security.

Amit Rao, head, ST Incard, ST Microelectronics India, presented an overview of "GlobalPlatform", an organization that defines, creates and promotes smart card usage and adoption. Its mission statement reads: "Establish, maintain and drive adoption of standards to enable an open and interoperable infrastructure for smart cards, devices and systems that simplifies and accelerates development, deployment and management of applications across industries." Boasting of 53 members, GlobalPlatform delivers the complete set of smart card specifications for an end-to-end smart card infrastructure. Rao added that over 50 million GlobalPlatform cards have been deployed worldwide. An additional 260+ million GSM cards globally use GlobalPlatform technology for over-the-air (OTA) application downloads. There have also been over 20 implementations across financial, ID/security, government, mobile telecom and public healthcare markets.

Anurag Gupta, CEO, A Little World Pvt. Ltd., touched upon the ZERO-Mass project. The ZERO-Mass Consortium will supply smart card services, allowing Indian banks to issue smart cards with several active payment and related applications. The ZERO-Mass project is based on a ST PROTON's PRISMA MATRIX card management infrastructure and utilizes Global Platform standards for cards, devices and systems. According to Anurag Gupta, its focus areas include: low penetration of terminals (80,000 EDCs cover <1 percent merchants); making cashless low-value transactions financially viable; multiple applications to make optimal use of deployed resources; backend infrastructure and networking; domestic clearing and settlement; catalyze penetration via partnerships; last-mile franchisee network of service delivery points; and liaise with regulators and government for policy support. He said it had four battering rams to open doors for mass deployment. These are: e-governance and micro-finance in rural areas, transit in six metros, loyalty linked to payment in urban areas, and mobile phones.

He added that an e-governance and micro-finance project was scheduled to be launched in Andhra Pradesh on July 15, in partnership with e-Seva, AP-Online and Velugu. Other current initiatives included a high-speed automatic fare collection system for buses and Mumbai suburban railways, loyalty linked to payment (CashBack), and mobile-to-mobile payment in Mumbai over both GSM and CDMA phones.

Commenting on the need for a national ID card in India, Mohit Gopal Rampal, assistant general manager-India sales operations, Rainbow Information Technologies Pvt. Ltd., said there were security concerns arising from infiltration and illegal immigration around border areas. A national ID card will also ensure that government subsidies reach the right recipients. It would allow any authorised person to verify the identity of an individual. Besides, the card would act as a multiple purpose ID for tax payments (sales/income etc.), bill payment, financial transactions, etc. The minimum requirement to address security concerns would be to adopt the smart card as an electronic identity token. The solution would be to use PKI and cryptography on cards supporting multiple applications.

Emerging technologies
The third session on "Emerging Technologies: Smart Cards, Biometrics and PKI" had three speakers. Alok Shende, director, technology practice, Frost & Sullivan said while 2003 saw a strong increase in unit shipments, silicon vendors and smart card manufacturers were looking to move up the value chain. Interest in ID security applications from the government sector, especially post 9/11, had brought new potential into the market. Software houses were also beginning to play a stronger role in smart card projects.

He said: "System integrators are beginning to play a more important role in the industry value chain. They are offering smart card products. In 2004, smart card and chip vendors are likely to remain focused on the largest application segments -- GSM, banking and government/ID segments. Open systems are making inroads in various smart card applications."

Shende added that global GSM unit shipments were likely to continue to grow in 2004 due to penetration in less saturated markets in Asia Pacific and the Americas. An increasing demand for high-end 64K and 128K SIM cards, as well as a growing demand for Java cards is improving the product mix. The Java card is seen as the preferred choice for many applications and has an increasing level of penetration over others. New entrants were now offering interoperable Java operating systems. End user awareness for multi-application smart cards had also risen, leading to an increased growth in open platforms, especially the Java card. The market was likely to grow faster during 2006. The contact less market was starting to surge as well, with the government pressurizing vendors to work on open systems. He said that the key drivers in Asia for smart cards were government initiatives to streamline healthcare projects and the birth of interoperability between national IDs. According to him, there would be an increase in smart cards with PKI and biometrics. A consortium approach would work much better.

Y.D. Wadaskar, managing director, WYSE Biometrics Systems Pvt. Ltd., pointed out that as the level of security breaches and transaction frauds increase, the need for highly secure identification and personal verification technologies was becoming apparent. "This can be achieved by biometrics. Biometric is a unique, measurable characteristic or trait of a human being for automatically recognising or verifying identity." Some available biometrics technology included DNA residue, dynamic signature, voice recognition, hand morphology, fingerprints, face and iris recognition. There was a need to find a balance between the overall system cost, capabilities and security level before selecting a biometric technology.

Ashok Sunder Rajan, chip architect, Gemplus Technologies Asia Pacific Pte. Ltd., presented a proposal that effectively shifted the paradigm from multi-application smart cards to multifunction backend interfaces. Such a proposal would pave the way for greater penetration and usage of government services. It would also allow several smart card projects to take off as pilots that were otherwise held back on grounds of scalability.

The 4th Smart Card Tech India 2004, international conference focused on the multipurpose applications of smart cards in the context of national security and to use them in the promotion of e-governance. The discussions were based on the government-to-citizen (G2C) interface in the backdrop of the Rs. 2,250 crore national e-governance action plan for 2003-07. Critical issues deliberated were the ID initiatives facing the government for increasing homeland security, the role of advanced smart card technologies, biometrics, IT vendor communities and their role in supplementing the government's efforts in national security operations. The conference provided the platform to understand investment opportunities, growth areas and collaboration networks among the key stakeholders and partners. It focused on areas of interoperability, infrastructure, privacy, security and cost.

The office of the Registrar General, government of India was the co-host of the 4th Smart Card Tech India 2004 international conference. The Indian Association for Medical Informatics was the co-sponsor. Frost & Sullivan, the global consultancy firm was the knowledge partner, and the endorsement was by Global Platform, UK. The platinum sponsor for the event was AKS Smart Card Systems Ltd., with Smart Chip Ltd., Data Card Group, Infineon Technologies and SafeNet as associate sponsors.