Beyond 1.4 Billion Aadhaar Enrolments and 20 Billion Monthly UPI Transactions, India’s Next Digital Challenge Is Connecting Government Data: TBI Report

The report, titled “From Digital Scale to Data Power: A Data Operating Model for India’s States,” argues that government data is not an administrative inconvenience but a delivery failure, one that leads to fiscal leakage, exclusion from welfare schemes and weaker public trust, and that will undermine India’s AI ambitions unless addressed first. According to NITI Aayog’s 2025 assessment cited in the report, poor-quality data causes fiscal leakage of an estimated four to seven percent of India’s annual welfare spending. Past clean-up exercises illustrate the scale of the problem: removing 17.1 million ineligible names from the PM-KISAN farmer support scheme saved an estimated ₹90 billion, eliminating 35 million bogus LPG connections saved ₹210 billion over two years, and dropping 16 million fake ration cards is saving roughly ₹100 billion annually.

The paper complements India’s ongoing push for data harmonisation and data-driven governance, spearheaded by the Ministry of Statistics and Programme Implementation (MoSPI). It analyses and builds on key Union government initiatives, including NMDS 2.0, SQAF, the AI-Readiness Framework, the QPR Portal and the Model Data Sharing Framework. It also draws on state-level programmes, including Karnataka’s Kutumba social registry, Odisha’s Social Protection Delivery Platform and Rajasthan’s Pehchan Portal, alongside initiatives in Andhra Pradesh, Uttar Pradesh, Tamil Nadu and Telangana.

The report notes that India’s digital infrastructure has scaled further and faster than almost any country’s. Aadhaar has supported more than 24.5 billion e-KYC transactions and helped raise formal banking inclusion from roughly 25% in 2008 to over 80% by 2023, while DigiLocker has issued and verified nearly 10 billion documents for over 685 million citizens. But the report argues that none of this is the same as making that data usable across departments and levels of government, and that without fixing this first, AI deployed on top of fragmented data will simply amplify existing blind spots rather than solve them.

“India’s first digital achievement has been a scale that few countries can match: proving that identity, payments and public systems could reach hundreds of millions of people reliably and fast. The next test is different. It is about whether data can be trusted, connected and used to deliver better outcomes. As the report argues, India has not yet built this capability with the same consistency as its digital infrastructure” said Ott Velsberg, former Government Chief Data Officer of Estonia and co-author of the paper.

To address this, TBI sets out seven recommendations for states, built around what it calls a state data operating model, covering leadership and mandate, data ownership and stewardship, common standards, shared data capabilities, independent quality assurance, legal and procurement safeguards, and a State Data Balance Sheet to help leaders manage data assets and risks the way they manage finances.

States that get this right will not simply end up with better dashboards. They will be better placed to catch problems early, direct resources where they are genuinely needed, and build public trust in the numbers the government publishes. As India moves toward wider AI adoption in governance, that foundation, the report concludes, will determine whether technology strengthens delivery or simply scales up the same blind spots faster.

About Tony Blair Institute for Global Change

Tony Blair Institute for Global Change is a not-for-profit organisation that works with political leaders and governments in more than 40 countries, to tackle major global challenges through policy and advice, including on data, technology and AI-enabled governance. Headquartered in London, the Institute works with governments and leaders in combining expertise in politics, policy and technology to help make the state more effective and citizen-focused. In India, TBI is supporting the Governments on wide-ranging policy issues including digital public infrastructure, data governance, AI and public-service delivery across education, energy, tourism and other sectors.

As a part of its recently launched global initiative CentreAI the Institute is driving how AI can transform existing government processes, while also creating an opportunity to rethink how government itself operates and how they understand problems, coordinate institutions and deliver, while keeping political judgement firmly human.

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