A pilot project in Hyderabad to assess the eligibility of welfare beneficiaries led to the removal of thousands of ration card holders by Telangana state's Samagra Vedika system.

According to a Telengana government document (pdf), 100,000 ration card holders were removed from the system for apparently being ‘ghost beneficiaries’ or fraudulent applicants. 

Once excluded, beneficiaries had to prove to government agencies that they were entitled to the subsidised food. But government officials allegedly often ignored them, or tended to back the decision of the algorithm.

The action resulted in the denial of food rations to people rightfully entitled to them, was seen to worsen social inequality, and led to a public outcry. 

Under significant public pressure, the government reinstated 14,000 cancelled ration cards through an 'appeals and verification' process. It refused to say how the system had gone wrong, though poor quality data and inadequate oversight have been considered likely causes. 

A subsequent government reanalysis of over 200,000 cards revealed that 15,000 had been incorrectly removed, according to Al-Jazeera.

The incident prompted concerns about the accuracy and fairness of the Samagra Vedika system, and its governance, transparency and accountability. 

It also raised questions about the ethics of using big data and machine learning for sensitive government decision-making.