Elections and the Universal Basic Income

The idea of the universal basic income has been getting global attention. In India, its implementation can benefit the poor section of the society only if it is prioritized and treated as a necessity. The concept of UBI states that every citizen of a country should receive a definite fixed amount of money regularly and unconditionally. Such a concept needs urgent implementation in India because several million people remain unemployed every year.

Although the last three decades have borne witness to rapid economic growth, it has not been able to compensate for the overwhelming population of India who is extremely poor. The present National Democratic Alliance introduced a scheme to implement UBI in the form of Pradhan Mantri Kisan Samman Nidhi Yojana (PM-KISAN) which ensures a minimum income of 6000 rupees per year or 500 rupees per month to all farmers who own less than 2 hectares of land. However, the scheme had a lot of limitations. Also, introduction of such a scheme without any mention of the sources from which the funds are to be drawn generated a lot of criticism. Thus, the budget was labeled as an ‘appeasement budget’. Such kind of a scheme could have several ill-effects as well. Such a giveaway could serve as an incentive for all the farmers to fragment their lands in order for them to be eligible enough to avail the benefits of the scheme.

Moreover, Congress manifesto is supposed to announce an even more ambitious form of this scheme. It plans to expand its MNREGS (Mahatma Gandhi Rural Employment Guaranteed Scheme) in order to provide 150 days’ work to all rural unemployed population. A direct income transfer to landless labour and marginal farmers, who are victim of multi-dimensional poverty and workers in the agricultural sectors have been proposed. Moreover, such a direct income transfer to the high-income and middle-income earners was not deemed necessary.

A huge section of the population engaged in the agricultural sector is compelled to borrow money from the moneylenders at an exorbitant rate of interest from 24% to 60%. Hence, these people get engaged in the loop of borrowing and are often not able to pay back such a huge sum of money. A support of about 15000 rupees on a yearly basis can help such farmers to repay their debts and can help them afford their livelihood.

Apart from enabling the farmers to be able to repay their debts, an additional income transfer would help the poorest people to afford healthcare, sufficient nutrition, enrolment of their children in school, etc. These households which will be able to come out of the trap of money lending and extreme poverty can indicate the success of this scheme. In addition to that, the scheme will also be able to serve its primary objective with which it was implemented – balancing the income inequality existing in the country.

However, execution of this hypothetical solution could be far from a cakewalk. A balance has to be reached, wherein such direct income transfers should not compromise on the existent public services of education and primary healthcare. Also, during budget allocation, this scheme should be prioritized and deemed to be of apex importance. At the present, the approximate number of households in India eligible to avail this scheme is about 10 crores. Hence, at the time of the budget allocation, in order to allot a total of 15000 rupees per annum to each household, one needs to keep aside a sum of rupees 1.5 lakh crores. This required amount does not align itself with the centre’s fiscal capacity at the moment. Hence, it is normal to assume that such kind of seemingly perfect schemes will draw heavy criticism from all sections of the population. All political parties bring out such ground-breaking concepts without mentioning the source of finance which would be required for funding that project.

Therefore, the road-map for implementation of these schemes should be discussed during election campaigning. Focus should be on planning and execution of sustainable projects which will be capable of self-financing. The focus shouldn’t be on such schemes which portray the government in a Godly position and makes the rural section dependent on these giveaways by the central authority. Authorities change and so do their capabilities to live by their promises. Hence, the political parties should urgently stop exploiting the vulnerabilities of the agricultural and unorganized sector in order to fulfill their political agendas. If an organization actually wants to address the cause of income inequality, it should empower the small scale and medium scale industries and permit their privatization (if required), instead of prohibiting them from functioning in their own manner. This will only cripple these sectors. Reformist policies need to replace seemingly populist strategies because crippling the backbone of the country just for the sake of garnering votes is an extremely selfish motive.

Picture Credits : livemint

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