MUMBAI - As
governments in a violence-ripped world build
techno-fortresses, computer chip-driven bits of plastic
flap as wonder cards driving the next sunrise industry.
Smart cards usually have multi-purpose lives, from being
national ID cards to tools for buying bus tickets or
paying the petrol pump bill. But, as privacy activists
warn, smart cards could also be gilt-coated Trojan
Horses for snooping governments, terrorists and crooks.
Essentially, computer chip-embedded plastic
cards that store and transact data, smart cards are
expected to be a US$6.8 billion global business this
year. Unit shipments were over 2 billion cards in 2003,
according to Jafizwaty Ishahak, industry analyst for
smart cards and auto ID with consultants Frost &
Sullivan. She told Asia Times Online that the
Asia-Pacific region alone accounts for about 34% of the
volume.
With Malaysia's MyKad, Hong Kong's Smart
Identity Card System (SMARTICS), Taiwan's Health Card,
the Indian government's plan to have a multi-purpose
national ID card and South Korea aiming for public
official ID cards by 2005, companies such as Sony,
Infineon and Hitachi are smacking their lips. Says
Ishahak: "India along with the rest of South Asia is an
active emerging market that shows lots of promise for
growth."
Experts estimate the Indian smart card
industry, growing at 45% annually, will reach $6 billion
by 2010. In the next five years, the Indian smart card
population is expected to increase eight-fold. Such
happy times for smart card makers are feeding the
growing banking and retailing industry, the cellular
phone boom in India - estimated to be exploding at over
70% annually (smart cards are used in SIM cards of GSM
mobile phones) - and big projects such as national ID
card schemes. "Thailand, the Philippines, Indonesia,
Vietnam, India and China are at the planning or pilot
stage of launching a national smart ID card scheme,"
says Ishahak.
Hong Kong's SMARTICS, which won a
Gold Award in the 6th Hong Kong Computer Society IT
Excellence Awards, represents a successful smart card
use. With a photograph, identity details and fingerprint
biometrics of each card owner, SMARTICS contains an
electronic certificate for encrypted e-transactions. In
a Hong Kong government press release, director of
immigration Lai Tung-kwok said: "ID cards with
multi-application is not only an identification document
but lays a solid foundation for e-applications and
e-commerce."
While India plans its multi-purpose
national ID card scheme, provincial governments have
already launched smart card projects for driving
licenses, vehicle registration, social security, health
and other uses. Later this year, Brihanmumbai
Electricity Supply and Transport (BEST) is scheduled to
launch an automatic fare collection in Mumbai buses
through smart card technology. BEST, besides being the
major electricity supplier in Mumbai, holds the monopoly
for public bus services in the city.
"We plan to
first issue smart card machines in 57 buses," A S
Tamboli, chief spokesperson for BEST, told Asia Times
Online. "With bus conductors carrying smart card reading
machines, the scheme will help reduce cumbersome ticket
transactions." BEST plans to use the smart card facility
in 394 of its 3,380-strong bus fleet in the first phase.
The smart card won't cost BEST anything, says Tamboli,
with the card company planning to use it as a
multi-purpose utility including credit/debit card
facilities. Mid-September, the Delhi transport
department will be using smart optical cards for new
vehicle registrations, with add-ons such as vehicle
history storage, log, tax, insurance, accidents and
other requirements under the Motor Vehicle Act.
Fortunately for smart card merchants in India,
privacy is yet to be a big talking point, unlike in the
West, where the presence of biometric identifiers such
as fingerprints, iris (eye) scans, or facial recognition
systems in ID cards has sparked off a debate that
lurches between security and privacy. The Electronic
Frontier Foundation dismissed national ID schemes as a
"solution in search of a problem". According to the EEF,
it opposes the national ID scheme in the United States
because there is "no compelling case for its utility or
effectiveness as a crime-fighting tool because of the
costs (dollars, privacy, and liberty) involved and its
high potential for abuse by entities in both public and
private sectors".
Privacy International, the
London-based human-rights group formed in 1990 as a
watchdog on surveillance and privacy invasions by
governments and corporations, says America's Patriot Act
indirectly squeezes countries into the US security
program. The Enhanced Border Security and Visa Entry
Reform Act, 2002 entails countries to have
machine-readable, tamper-resistant passports to qualify
for the visa waiver program.
The Indian
government took a major step toward spreading smart card
use by a standardized operating system called SCOSTA
(Smart Card Operating System for Transport Application)
developed by the Indian Institute of Technology, Kanpur,
as the standard operating system for driving licenses
and other transport-related projects. A Frost &
Sullivan report in 2003 listed the bigger bottlenecks
for the Indian smart card market: "Low purchasing power,
low technology awareness and cultural shifts, delay in
approval standards, other cheaper competing technologies
and poor allied infrastructure such as telecom, ATMs and
card readers, etc."
According to an industry
professional, smart cards in India are estimated to cost
around $2 to $4 a person. But the system to enable use
of smart cards could cost a business establishment
around $1,000. Worse costs could lurk. Privacy
International warns that no smart card technology is
secure enough to escape fakes issued by terrorist and
criminal gangs. Besides, there could be inevitable
goof-ups. In 2002, personal data was leaked from Japan's
new nationwide identification system only two days after
the controversial program was launched. Personal
information of over 2,500 people was sent to the wrong
people, the Osaka regional government admitted
shamefacedly.
The system already faced
widespread protests and opposition even before the
blunder, with fears of individual privacy violation and
abuse. Months earlier, the Japanese Defense Agency was
found to have been secretly compiling private
information on people who had requested documents under
the country's Freedom of Information Act.
Security worries can be contained, says a
leading semi-conductor company. "The authentication can
happen on the card itself so that personal data do not
have to leave the card," Reiner Schnrock, a senior
director at the Munich-based Infineon Technologies AG,
told Asia Times Online. "Through the use of smart cards,
personal data can be stored decentrally on the card."
A better way ahead to avoid such abuse, believe
some experts, would be to develop smart cards more as
e-commerce and e-governance tools to access government
services rather than as the more controversial national
ID cards. However, in cash-strapped Indian states,
money, more than privacy and security, seems a bigger
issue with the whole deal.
Raja M is
an independent writer based in Mumbai, India.
(Copyright 2004 Asia Times Online Ltd. All
rights reserved. Please contact content@atimes.com for
information on our sales and syndication
policies.)
