India saved 1 billion US dollars annually using Aadhaar: World Bank

The World Bank on 14 January 2016 announced that India saved 1 billion US dollars annually by using Aadhaar. It was revealed in the bank’s publication World Development Report 2016: Digital Dividends that was released in Washington DC, the USA.

As per the report, transfer of fuel subsidy to bank accounts using the Aadhaar-based Direct Benefit Transfer (DBT) saved about 1 billion per year when applied throughout the country on account of reduced leakage and efficient gains.

The report further estimated that the DBT has the potential to save over 11 billion US dollars per year in government expenditure if the scheme is expanded to other subsidy programmes.

Findings of the report with respect to India

• China has the largest number of internet users, followed by the United States, with India, Japan, and Brazil filling out the top five.
• A digital identification system such as India’s Aadhaar, by overcoming complex information problems, helps willing governments to promote the inclusion of disadvantaged groups.
• In India, there are an estimated 1.063 billion population are offline.
• Nearly 900 million Indians have been issued digital IDs in the past fi ve years, which they are using to open bank accounts, monitor attendance of civil servants, and identify recipients of government subsidies.
• Digital governance played a role in improving public sector capability. For example, e-procurement helped in injecting more competition into the process by increasing the probability that the winning bidder comes from outside the project’s region.