FOOD SECURITY
Understanding the PDS
JEAN DREZE AND REETIKA KHERA
A survey in nine States shows that they have quietly revived and expanded their public distribution system.
At a slum in Patel Nagar in Hyderabad. A large number of the poor are excluded from the public distribution system. The PDS tends to work better where it is more inclusive – targeting is divisive and undermines public pressure for a functional PDS
AT a time when the Union Cabinet cleared the draft of the national food security Bill after dilly-dallying over it comes a compelling piece of information: many State governments have quietly revived and expanded the public distribution system in their States. That, at any rate, is one of the main findings of a recent survey of the PDS in nine States: Andhra Pradesh, Bihar, Chhattisgarh, Himachal Pradesh, Jharkhand, Orissa, Rajasthan, Uttar Pradesh and Tamil Nadu. The survey, initiated by the Indian Institute of Technology Delhi, covered about 1,200 randomly selected below-poverty-line (and Antyodaya) households in 110 villages.
One sign of revival is that the sample households had received 85 per cent of their official “quota” of PDS grain during the preceding three months. This contrasts with the common perception that most of the grain meant for poor households ends up in the open market. Further, with market prices shooting up and PDS issue prices coming down, the implicit value of PDS transfers is now quite substantial. In many States, BPL households get as much from the PDS every month as they would after a whole week of employment under the National Rural Employment Guarantee Act (NREGA) – without having to work.
The health of the PDS, of course, varies widely among States. Some, like Himachal Pradesh and Tamil Nadu, have a well-functioning universal PDS, which provides not only foodgrains but also other essential commodities such as pulses and oil. At the other extreme are States like Bihar and Jharkhand where PDS reforms have barely begun. The PDS tends to work better where it is more inclusive – targeting is divisive and undermines public pressure for a functional PDS.
Aside from expanding coverage and lowering issue prices, many State governments have launched other PDS reforms such as de-privatisation of fair price shops, “doorstep delivery” of grain to fair price shops, computerisation of records, and a range of transparency measures. An important lesson of recent experience is not only that the PDS can be improved, but also that we have a reasonably good idea of how to do it. Much depends on the political value of the PDS. That is perhaps the biggest recent change: with market prices shooting up, the PDS now means a lot for poor people, and State governments had to respond to the clamour for a functional PDS.
It would be a tragedy if the National Food Security Act ended up undermining instead of consolidating this revival of the PDS. There is a real danger of this happening, not only because of the continued obsession of the Central government with “targeting” but also because of the illusion that cash transfers are an easy alternative. A large majority of the sample households were opposed to the PDS being replaced with cash transfers, and the reasons they gave for this were enlightening
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A sample of the survey findings is presented in this issue of Frontline, including four articles written by some of the student volunteers who conducted this investigation. A more detailed report was published in a recent issue of Economic and Political Weekly. We hope this material contributes to a better understanding of the PDS, and to a more enlightened debate on these vital issues.
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Out look India Magazine, Nov 14th 2011
On the margin - India’s economic growth hasn’t reached him
Putting Growth In Its Place
It has to be but a means to development, not an end in itself
JEAN DREZE , AMARTYA SEN
Is India doing marvellously well, or is it failing terribly? Depending on whom you speak to, you could pick up either of those answers with some frequency. One story, very popular among a minority but a large enough group—of Indians who are doing very well (and among the media that cater largely to them)—runs something like this. “After decades of mediocrity and stagnation under ‘Nehruvian socialism’, the Indian economy achieved a spectacular take-off during the last two decades. This take-off, which led to unprecedented improvements in income per head, was driven largely by market initiatives. It involves a significant increase in inequality, but this is a common phenomenon in periods of rapid growth. With enough time, the benefits of fast economic growth will surely reach even the poorest people, and we are firmly on the way to that.” Despite the conceptual confusion involved in bestowing the term ‘socialism’ to a collectivity of grossly statist policies of ‘Licence raj’ and neglect of the state’s responsibilities for school education and healthcare, the story just told has much plausibility, within its confined domain.
But looking at contemporary India from another angle, one could equally tell the following—more critical and more censorious—story: “The progress of living standards for common people, as opposed to a favoured minority, has been dreadfully slow—so slow that India’s social indicators are still abysmal.” For instance, according to World Bank data, only five countries outside Africa (Afghanistan, Bhutan, Pakistan, Papua New Guinea and Yemen) have a lower “youth female literacy rate” than India (World Development Indicators 2011, online). To take some other examples, only four countries (Afghanistan, Cambodia, Haiti, Myanmar and Pakistan) do worse than India in child mortality rate; only three have lower levels of “access to improved sanitation” (Bolivia, Cambodia and Haiti); and none (anywhere—not even in Africa) have a higher proportion of underweight children. Almost any composite index of these and related indicators of health, education and nutrition would place India very close to the bottom in a ranking of all countries outside Africa.
Growth and Development
So which of the two stories—unprecedented success or extraordinary failure—is correct? The answer is both, for they are both valid, and they are entirely compatible with each other. This may initially seem like a bit of a mystery, but that initial thought would only reflect a failure to understand the demands of development that go well beyond economic growth. Indeed, economic growth is not constitutively the same thing as development, in the sense of a general improvement in living standards and enhancement of people’s well-being and freedom. Growth, of course, can be very helpful in achieving development, but this requires active public policies to ensure that the fruits of economic growth are widely shared, and also requires—and this is very important—making good use of the public revenue generated by fast economic growth for social services, especially for public healthcare and public education.
The minority of the better-off forgets that even after 20 years of growth, India’s among the world’s poorest nations.
We referred to this process as “growth-mediated” development in our 1989 book, Hunger and Public Action. This can indeed be an effective route to a very important part of development; but we must be clear about what can be achieved by fast economic growth on its own, and what it cannot do without appropriate social supplementation. Sustainable economic growth can be a huge force not only for raising incomes but also for enhancing people’s living standards and the quality of life, and it can also work very effectively for many other objectives, such as reducing public deficits and the burden of public debt. These growth connections do deserve emphasis, not only in Asia, Africa and Latin America, but also very much in Europe today, where there has been a remarkable lack of understanding of the role of growth in solving problems of debt and deficit. There is a tendency to concentrate only on draconian restrictive policies to cut down public expenditure, no matter how essential and no matter how these policies kill the goose that lays the golden egg of economic growth. There is a neglect of the role of economic growth in economic and financial stability in the European debate, with its focus only on cutting public expenditure to satisfy the market and to obey the orders of credit rating agencies.
Yet it is also important to recognise that the impact of economic growth on living standards is crucially dependent on the nature of the growth process (for instance, its sectoral composition and employment intensity) as well as of the public policies—particularly relating to basic education and healthcare—that are used to enable common people to share in the process of growth. There is also, in India, an urgent need for greater attention to the destructive aspects of growth, including environmental plunder (e.g. through razing of forests, indiscriminate mining, depletion of groundwater, drying of rivers and massacre of fauna) and involuntary displacement of communities—particularly adivasi communities—that have strong roots in a particular ecosystem.
ndia’s growth achievements are indeed quite remarkable. According to official data, per capita income has grown at a compound rate of close to five per cent per year in real terms between 1990-91 and 2009-10. The more recent rates of expansion are faster still: according to Planning Commission estimates, the growth rate of GDP was 7.8 per cent in the Tenth Plan period (2002-03 to 2006-07) and is likely to be around 8 per cent in the Eleventh Plan period (2007-08 to 2011-12).
The European debate focuses only on curbing public spend, ignoring the role of economic growth in financial stability.
The “advance estimate” for 2010-11 is 8.6 per cent. These are, no doubt, exceptional growth rates—the second-highest in the world, next to China. These dazzling figures are, understandably, causing some excitement, and were even described as “magic numbers” by no less than Lord Meghnad Desai, who argued, not without irony, that whatever else happens, “the government can still sit back and say 8.6 per cent”.
India does need rapid economic growth, if only because average incomes are so low that they cannot sustain anything like reasonable living standards, even with extensive income redistribution. Indeed, even today, after 20 years of rapid growth, India is still one of the poorest countries in the world, something that is often lost sight of, especially by those who enjoy world-class living standards thanks to the inequalities in the income distribution. According to World Development Indicators 2011, only 16 countries outside Africa had a lower “gross national income per capita” than India in 2010: Afghanistan, Bangladesh, Cambodia, Haiti, Iraq, Kyrgyzstan, Lao, Moldova, Nepal, Nicaragua, Pakistan, Papua New Guinea, Tajikistan, Uzbekistan, Vietnam and Yemen. This is not exactly a club of economic superpowers.
Bangladesh and Nepal do not have India’s per capita income but have vastly improved indices.
Having said this, it would be a mistake to “sit back” and rely on economic growth per se to transform the living conditions of the unprivileged. Along with our discussion of “growth-mediated” development, in an earlier book, we also drew attention to the pitfalls of “unaimed opulence”—the indiscriminate pursuit of economic expansion, without paying much attention to how it is shared or how it affects people’s lives. A good example, at that time (in the late 1980s), was Brazil, where rapid growth went hand in hand with the persistence of massive deprivation. Contrasting this with a more equitable growth pattern in South Korea, we wrote “India stands in some danger of going Brazil’s way, rather than South Korea’s”. Recent experience vindicates this apprehension. Interestingly, in the meantime, Brazil has substantially changed course, and adopted far more active social policies, including a constitutional guarantee of free and universal healthcare as well as bold programmes of social security and economic redistribution (such as Bolsa Familia). This is one reason why Brazil is now doing quite well, with, for instance, an infant mortality rate of only 9 per 1,000 (compared with 48 in India), 99 per cent literacy among women aged 15-24 years (74 per cent in India), and only 2.2 per cent of children below five being underweight (compared with a staggering 44 per cent in India). While India has much to learn from earlier experiences of growth-mediated development elsewhere in the world, it must avoid unaimed opulence—an undependable, wasteful way of improving the living standards of the poor.
India’s Decline in South Asia
One indication that something is not quite right with India’s development strategy is the fact that India has started falling behind every other South Asian country (with the partial exception of Pakistan) in terms of social indicators, even as it is doing so well in terms of per capita income (see table below).
The comparison between Bangladesh and India is a good place to start. During the last 20 years or so, India has grown much richer than Bangladesh: per capita income was estimated to be 60 per cent higher in India than in Bangladesh in 1990, and 98 per cent higher (about double) in 2010. But during the same period, Bangladesh has overtaken India in terms of a wide range of basic social indicators: life expectancy, child survival, fertility rates, immunisation rates, and even some (not all) schooling indicators such as estimated “mean years of schooling”.
Seeing its neighbours, India’s poor could well wonder what economic growth has got them.
The comparison between Bangladesh and India is a good place to start. During the last 20 years or so, India has grown much richer than Bangladesh: per capita income was estimated to be 60 per cent higher in India than in Bangladesh in 1990, and 98 per cent higher (about double) in 2010. But during the same period, Bangladesh has overtaken India in terms of a wide range of basic social indicators: life expectancy, child survival, fertility rates, immunisation rates, and even some (not all) schooling indicators such as estimated “mean years of schooling”. For instance, life expectancy was estimated to be four years longer in India than in Bangladesh in 1990, but it had become three years shorter by 2008. Similarly, the child mortality rate was estimated to be about 24 per cent higher in Bangladesh than in India in 1990, but it was 24 per cent lower in Bangladesh in 2009. Most social indicators now look better in Bangladesh than in India, despite Bangladesh having barely half of India’s per capita income.
No less intriguing is that Nepal also seems to be catching up rapidly with India, and even overtaking India in some respects. Around 1990, Nepal was way behind India in terms of almost every development indicator. Today, social indicators for both countries are much the same (sometimes a little better in India still, sometimes the reverse), in spite of per capita income in India being about three times as high as in Nepal.
To look at the same issue from another angle, Table 2 displays India’s “rank” among South Asia’s six major countries (excluding tiny Maldives), around 1990 as well as today (more precisely, in the latest year for which comparable international data are available). As expected, in terms of per capita income, India’s rank has improved—from fourth (after Bhutan, Pakistan and Sri Lanka) to third (after Bhutan and Sri Lanka). But in most other respects, India’s rank has worsened, in fact, quite sharply in many cases. Overall, India had the best social indicators in South Asia in 1990, next to Sri Lanka, but now looks second-worst, ahead of only Pakistan. Looking at their South Asian neighbours, the Indian poor are entitled to wonder what they have gained—at least so far—from the acceleration of economic growth.
India and China
One of the requirements of successful growth-mediated development is the skilful use of the opportunities provided by increasing public revenue. There are interesting and important contrasts in the policies followed by different countries in this respect. Since China is often cited by advocates of a single-minded focus on economic growth, it is interesting to compare what China does with what India has been doing. China makes much better use of the opportunities offered by high economic growth to expand public resources for development purposes. For example, government expenditure on healthcare in China is nearly four times that in India (after adjusting for “purchasing power parity”—the gap is even larger otherwise). China does, of course, have a larger population and a higher per capita income than India, but even as a ratio of GDP, public expenditure on health is much higher in China (about 2.3 per cent) than in India (around 1.4 per cent).
The RTI Act may not apply to information with private corporations but it can help contain the state-corporate nexus.
As Table 1 illustrates, China has much higher values of most social indicators of living standards, such as life expectancy (73 years in China and 64 years in India), infant mortality rate (16 per thousand in China and 48 in India), mean years of schooling (estimated to be 7.6 years in China, compared with only 4.4 years in India), or the coverage of immunisation (very close to universal in China but only around two-thirds in India, for DPT and measles). While India has nearly caught up with China in terms of the rate of economic growth, it seems quite far behind China in terms of the use of public resources for social support, and correspondingly, it has not done nearly as well in translating growth into rapid progress of social indicators. While there are also, undoubtedly, other factors behind the China-India contrast, the differing use of the fruits of growth for social support would seem to be an important influence in this contrasting picture.
It is not at all our purpose to argue that India should learn from China in every respect. India has reasons to value its democratic institutions. Even with all their limitations, these institutions allow for a wide variety of voices to be heard, and facilitate significant opportunities for various forms of public participation in governance. There are, of course, many failings of Indian democracy (which we have discussed in our writings), but there are big democratic achievements as well, and also the hindrances can be addressed through democratic battles to remove them. If China officially executes more people in a week than India has done since Independence (and this is true of a shockingly large number of weeks every year in China), this comparison, like many others involving legal and human rights of citizens, is not to India’s disadvantage. If there is something to learn from China, especially about how to ensure that the fruits of economic growth are more widely shared, then that is a case for learning from what there is to learn, not a case for blind imitation.
The China-India contrast does, however, raise another interesting question: could it be that India’s democratic system is a barrier to using the fruits of economic growth for the purpose of enhancing health, education and other aspects of “social development”?
Not even one of the 315 editors
and senior leaders of the print and electronic media
in a survey were SC or ST.
In addressing this question, there is some possibility of a sense of nostalgia. When India had a very low rate of economic growth, a common argument coming from the critics of democracy was that democracy was hostile to fast economic growth. It was hard, at that time, to convince the anti-democratic advocates that fast economic growth depends on the friendliness of the economic climate, rather than on the fierceness of political systems. That debate on the alleged contradiction between democracy and economic growth has now ended (not least because of the high economic growth rates of democratic India), but a similar scepticism about democracy seems to be now emerging, suggesting an alleged inability of democratic systems to pursue public health, public education and other socially supportive arrangements.
It is important in this context to understand how democratic decisions emerge and how policies get adopted. What a democratic system achieves depends greatly on the issues that are politicised, which contributes to their advancement. Some issues are extremely easy to politicise, such as the calamity of a famine—and as a result famines tend to stop abruptly with the establishment of a democratic political system. But other issues—less spectacular and less immediate—present a much harder challenge. Using democratic means for remedying inadequate coverage of public healthcare, non-extreme undernourishment, or inadequate opportunities for school education demands more from democratic practice—more vigour and much more range.
Authoritarian systems can change their policies very quickly, when the leaders want that, and it is to the credit of the Chinese political leaders that they have focused so much on social interventions in education, healthcare and other supportive mechanisms to advance the quality of life of the Chinese people.
India-China comparison tends to focus on the horse race of relative rates of overall growth.
But authoritarianism does not, of course, provide any kind of guarantee that the social commitments will emerge (they clearly have not in North Korea or Burma), or that they would invariably be stable and non-fragile (there have been sharp variations in the past even in China, including its having the largest famine in world history during the failure of the Great Leap Forward initiative).
Even China’s commitment to broad-based public healthcare has had ups and downs, and came close to being undone: the coverage of the rural cooperative medical system crashed from 90 per cent to 10 per cent between 1976 and 1983 (when market-oriented reforms were initiated), and stayed around 10 per cent for a full 20 years. During this period of abdication of state responsibility for healthcare in China, the progress of health-related indicators (such as life expectancy and child survival) slowed down sharply. This led eventually to another U-turn, around 2004-5, when the rural cooperative medical system was rebuilt, with the coverage rising again to 90 per cent or so within three years (Shaoguang Wang, ‘Double Movement in China’, Economic and Political Weekly, Dec 27, 2008).
You call this education? A government school in Lucknow. (Photograph by Nirala Tripathi)
There is, in fact, no real barrier in India in combining multi-party democratic governance with active social intervention. But what would be needed is much greater public engagement with the central demands of justice and development through more vigorous democratic practice. The development of the welfare state in Europe has many lessons to offer here. As it happens, public debate is quite powerful in India, but the range of engagement has often been quite limited. The India-China comparisons tend to concentrate mostly on the horse race of relative rates of overall economic growth rather than the variations in mediation for development. Underlying this dialogic narrowness, there is a social picture. A big part of the Indian population—a fairly small minority but still quite large in absolute numbers—has been doing very well indeed, through the process of high growth alone; they do not depend on social mediation. In contrast, more vigorous mediation would be very important for other Indians—many more, in fact—whose lives are affected by ill health, undernourishment, lack of healthcare and other deprivations.
Power Imbalances, Old and New
The neglect of elementary education, healthcare, social security and related matters in Indian planning fits into a general pattern of pervasive imbalance of political and economic power that leads to a massive neglect of the interests of the unprivileged. Other glaring manifestations of this pattern include disregard for agriculture and rural development, environmental plunder for private gain with huge social losses, large-scale displacement of rural communities without adequate compensation, and the odd tolerance of human rights violations when the victims come from the underdogs of society.
None of this is entirely new, and much of it reflects good old inequalities of class, caste and gender that have been around for a long time
But China makes much better use of growth to extend public resources for development
For instance, the fact that not even one of the 315 editors and other leading members of the printed and electronic media in Delhi surveyed recently by the Centre for the Study of Developing Societies belonged to a scheduled caste or scheduled tribe, and that at the other end, 90 per cent belonged to a small coterie of upper castes that make up only 16 per cent of the population, obviously does not help to ensure that the concerns of Dalits and adivasis are adequately represented in public debates. Nor is India’s male-dominated Lok Sabha (where the proportion of women has never crossed 10 per cent so far) well placed to address the concerns of women—not only gender issues, but also other social issues in which women may have a strong stake. A similar point applies to rural-urban disparities: a recent study found that rural issues get only two per cent of the total news coverage in national dailies.
Some of these inequalities are diminishing, making it easier for disadvantaged groups to gain a voice in the system (even the proportion of women in the Lok Sabha, abysmally low as it is, is about three times as high today as it was 50 years ago). However, new or rising inequalities are also reinforcing the vicious circle of disempowerment and deprivation. For instance, the last 20 years have seen a massive growth of corporate power in India, a force that is largely driven—with some honourable exceptions—by unrestrained search for profits. The growing influence of corporate interests on public policy and democratic institutions does not particularly facilitate the reorientation of policy priorities towards the needs of the unprivileged.
It is important to recognise the influence of elements of the corporate sector on the balance of public policies, but it would be wrong to take that to be something like an irresistible natural force. India’s democratic system offers ways and means of resisting the new biases that may emanate from the pressure of business firms
The growing influence of corporate interests on public policy is not reorienting policy priorities towards the unprivileged
One instructive example both of a naked attempt to denude an established public service and of the possibility of defeating such an attempt is the long saga of attempted takeover of India’s school meal programme by biscuit-making firms. The “midday meal” programme, which provides hot cooked meals prepared by local women to some 120 million children, with a substantial impact on both nutrition and school attendance, had been eyed for many years by food manufacturers, especially the biscuits industry.
A few years ago, a “Biscuit Manufacturers’ Association” (BMA) launched a massive campaign for the replacement of cooked school meals with branded biscuit packets. The BMA wrote to all members of Parliament, asking them to plead the case for biscuits with the minister concerned and assisting them in this task with a neat pseudo-scientific precis of the wonders of manufactured biscuits. Dozens of MPs, across most of the political parties, promptly obliged by writing to the minister and rehashing the BMA’s bogus claims. According to one senior official, the ministry was “flooded” with such letters, 29 of which were obtained later under the Right to Information Act. Fortunately, the proposal was firmly shot down by the ministry after being referred to state governments and nutrition experts, and public vigilance exposed what was going on. The minister, in fact, wrote to a chief minister who sympathised with the biscuit lobby: “We are, indeed, dismayed at the growing requests for introduction of pre-cooked foods, emanating largely from suppliers/marketers of packaged foods, and aimed essentially at penetrating and deepening the market for such foods” (Hindustan Times, Apr 14, 2008).
The bigger battle is still on. The BMA itself did not give up after being rebuked by the Union minister for human resource development. It proceeded to write to the Union minister for women and child development, with a similar proposal for supplying biscuits to children below the age of six years under the Integrated Child Development Services (ICDS).
What is dangerous is the illusion that cash transfers can somehow replace public services.
Other food manufacturers are also on the job, and despite much vigilance and resistance from activist quarters (and the Supreme Court), they seem to have made significant inroads into child feeding programmes in several states.
Similar concerns apply in other fields of social policy. For instance, the prospects of building a public healthcare system in India are unlikely to be helped by the growing influence of commercial insurance companies, very active in the field of health. India’s health system is already one of the most privatised in the world, with predictable consequences—high expenditure, low achievements and massive inequalities. Yet, there is much pressure to embrace this “American model” of healthcare provision, despite the international recognition in the health community of its comparatively low achievement and significantly high cost.
Rosy picture Himachal leads the way in social indices.
(Photograph by Tribhuvan Tiwari)
However, recent events have also shown the possibility of fighting back, not just in terms of winning isolated battles against inappropriate corporate influence, as happened with the biscuits lobby, but also in terms of building institutional safeguards against abuses of corporate power. The Right to Information Act, for instance, though not directly applicable to information held by private corporations, is a powerful means of watching and containing the state-corporate nexus, as the biscuits story illustrates. Regulations and legislations pertaining to corporate funding of political parties, corporate social responsibility, financial transparency, environmental standards, and workers’ rights also have an important role to play in disciplining the corporate sector.
The Case for a Comprehensive Approach
The need for growth-mediated development has not been completely ignored in Indian policy debates. The official goal of “inclusive growth” could even claim to have much the same connotation. However, the rhetoric of inclusive growth has gone hand in hand with elitist policies that often end up promoting a two-track society whereby superior (“world-class”) facilities are being created for the privileged, while the unprivileged receive second-rate treatment, or are left to their own devices, or even become the target of active repression—as happens, for instance, in cases of forcible displacement without compensation, with a little help from the police. Social policies, for their part, remain quite restrictive (despite some significant, hard-won initiatives such as the National Rural Employment Guarantee Act), and are increasingly steered towards quick fixes such as conditional cash transfers. Their coverage, in many cases, is also sought to be confined to “below poverty line” (BPL) families, a narrowly defined category that tends to shrink over time as per capita incomes increase, which may even look like a convenient way of ensuring that social welfare programmes are “self-liquidating”.
Cash transfers are increasingly seen as a potential cornerstone of social policy in India, often based on a distorted reading of the Latin American experience in this respect. There are, of course, strong arguments for cash transfers (conditional or unconditional) in some circumstances, just as there are good arguments for transfers in kind (such as midday meals for school children).
In Delhi, Rs 30 a person a day can get a kg of rice and a one-way bus ticket three stops down.
What is remarkably dangerous, however, is the illusion that cash transfers (more precisely, “conditional cash transfers”) can replace public services by inducing recipients to buy health and education services from private providers. This is not only hard to substantiate on the basis of realistic empirical reading; it is, in fact, entirely contrary to the historical experience of Europe, America, Japan and East Asia in their respective transformation of living standards. Also, it is not how conditional cash transfers work in Brazil or Mexico or other successful cases today.
In Latin America, conditional cash transfers usually act as a complement, not a substitute, for public provision of health, education and other basic services. The incentives work for their supplementing purpose because the basic public services are there in the first place. In Brazil, for instance, basic health services such as immunisation, antenatal care and skilled attendance at birth are virtually universal. The state has done its homework—almost half of all health expenditure in Brazil is public expenditure, compared with barely one quarter (of a much lower total of health expenditure) in India. In this situation, providing incentives to complete the universalisation of healthcare may be quite sensible. In India, however, these basic services are still largely missing, and conditional cash transfers cannot fill the gap.
Poor initiatives Jairam and Montek discussing
the poverty line at a press conference.
(Photograph by Jitender Gupta)
The pitfalls of “BPL targeting” have become increasingly clear in recent years. First, there is no reliable way of identifying poor households, and the exclusion errors are enormous: at least three national surveys indicate that, around 2004-05, about half of all poor households in rural India did not have a “BPL card”. Second, India’s poverty line is abysmally low, so that even if all the BPL cards were correctly and infallibly allocated to poor households, large numbers of people who are in dire need of social support would remain excluded from the system. In 2009-10, for instance, the official poverty line in Delhi was around Rs 30 per person per day. This is just about enough to buy one kilogram of rice and a one-way bus ticket that would take you three stops down the road. Third, BPL targeting is extremely divisive, and undermines the unity and strength of public demand for functional social services, making a collaborative right into a divisive privilege.
The power of comprehensiveness in social policy is evident not only from international and historical experience, but also from contemporary experience in India itself. In at least three Indian states, universal provision of essential services has become an accepted norm. Kerala has a long history of comprehensive social policies, particularly in the field of elementary education—the principle of universal education at public expense was an explicit objective of state policy in Travancore as early as 1817. Early universalisation of elementary education is the cornerstone of Kerala’s wide-ranging social achievements.
Less well known, but no less significant, is the gradual emergence and consolidation of universalistic social policies in Tamil Nadu (see ‘Understanding Public Services in Tamil Nadu’ by Vivek S., PhD thesis, 2010, Syracuse University, and the literature cited there). Tamil Nadu was the first state to introduce free and universal midday meals in primary schools. This initiative, much derided at that time as a “populist” programme, later became a model for India’s national midday meal programme, widely regarded today as one of the best “centrally sponsored schemes”. The state’s pioneering efforts in the field of early child care, under the ICDS, has made great strides towards the provision of functional anganwadis (child care centres), accessible to all, in every habitation. Tamil Nadu, unlike most other states, also has an extensive network of lively and effective healthcare centres, where people from all social backgrounds can get reasonably good healthcare, free of cost. NREGA, another example of universalistic social programme, is also doing well in Tamil Nadu: employment levels are high (with about 80 per cent of the work going to women), wages are usually paid on time and leakages are relatively small. Last but not the least, Tamil Nadu has a universal public distribution system (PDS), in both rural and urban areas. Tamil Nadu’s pds supplies not only foodgrains but also oil, pulses and other food commodities, with astonishing regularity and minimal leakages.
Protests against Vedanta in Orissa
Himachal Pradesh began this journey much later than Kerala and Tamil Nadu, but is catching up very quickly. This is most evident in the field of elementary education: starting from literacy levels similar to the dismal figures for Bihar or Uttar Pradesh around the time of India’s Independence, Himachal Pradesh caught up with the highest-performing Kerala within a few decades. This “schooling revolution” was based almost entirely on a policy of universal provision of government schools, and even today, elementary education in Himachal Pradesh is overwhelmingly in the public sector. Like Tamil Nadu, Himachal Pradesh has a well-functioning pds, providing not only foodgrain but also pulses and oil and covering both “BPL” (Below Poverty Line) and “APL” (Above Poverty Line) families. Himachal Pradesh has also followed comprehensive principles not only in the provision of essential social services (including schooling facilities, healthcare and child care) but also in the provision of basic amenities such as roads, electricity, drinking water and public transport. For instance, in spite of adverse topography and scattered settlements, 98 per cent of Himachali households had electricity in 2005-6.
It is perhaps not an accident that Kerala, Tamil Nadu and Himachal Pradesh also tend to have the best social indicators among all major Indian states. For instance, a simple index of children’s health, education and nutrition achievements clearly places these three states at the top (Dreze, R. Khera, S. Narayanan, 2007, ‘Early Childhood in India: Facing the Facts’, Indian Journal of Human Development, 1(2), Jul-Dec 2007). Despite wide historical, cultural and political differences, they have converged towards a similar approach to social policy, and the results are much the same too. There is a crucial lesson here for other Indian states, and indeed for the country as a whole.
A Concluding Remark
We hope that the puzzle with which we began is a little clearer now. India’s recent development experience includes both spectacular success as well as massive failure. The growth record is very impressive, and provides an important basis for all-round development, not least by generating more public revenue (about four times as much today, in real terms, as in 1990). But there has also been a failure to ensure that rapid growth translates into better living conditions for the Indian people. It is not that they have not improved at all, but the pace of improvement has been very slow—even slower than in Bangladesh or Nepal. There is probably no other example in the history of world development of an economy growing so fast for so long with such limited results in terms of broad-based social progress.
There is no mystery in this contrast, or in the limited reach of India’s development efforts. Both reflect the nature of policy priorities in this period. But as we have argued, these priorities can change through democratic engagement—as has already happened to some extent in specific states. However, this requires a radical broadening of public discussion in India to development-related matters—rather than keeping it confined to simple comparisons of the growth of the gnp, and naive admiration (implicit or explicit) of the high living standards of a relatively small part of the population. An exaggerated concentration on the lives of the minority of the better-off, fed strongly by media interest, gives an unreal picture of the rosiness of what is happening to Indians in general, and stifles public dialogue of other issues. Imaginative democratic practice, we have argued, is essential for broadening and enhancing India’s development achievements.
Jean Dreze is Visiting Professor, Department of Economics, Allahabad University. Nobel laureate Amartya Sen is Lamont University professor and Professor of Economics and Philosophy at Harvard University.
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October 2, 2011
Jean Dreze
Destitute women demonstrate in Bhopal demanding higher pension
and renewal of their BPL ration cards, in this October 2008 file photo.
Photo: A.M. Faruqui
The Planning Commission's poverty straight jacket is but one of a series of obstacles faced by “aspirants” to the BPL status.
Nothing illustrates the absurdity of current food policies more poignantly than the plight of Dablu Singh's family in Latehar district, Jharkhand. About two years ago Dablu, a young Adivasi who survived mainly from casual labour, fell from a roof at work and broke his back. He is paralysed for life and needs intensive care. His wife Sumitra looks after him, their daughter, and a small baby (aside from a few goats and hens), and is unable to work for wages. The family is on the verge of starvation.
“Below Poverty Line” (BPL) families in Jharkhand are entitled to 35 kg of rice per month at Re.1 per kg. This is a great relief for these families, but Dablu Singh's family doesn't have a BPL card.
Meanwhile, the godowns of the Food Corporation of India (FCI) are bursting at the seams yet again. The FCI is lumbered with about 60 million tonnes of wheat and rice, and doesn't know where to put the excess stocks. Some want to export them, others want to brew them, others still want to privatise the FCI and be done. Expanding storage capacity is routinely offered as a solution — but how about distributing some of the excess grain?
There is no dearth of families like Dablu's. According to the National Sample Survey, about half of all poor families in rural India do not have a BPL card. Why not cover the rest and distribute the food?
Dablu Singh's only hope is that his plight has been noticed. Soon after his accident, he attracted the attention of local journalists, and later on, of the District Collector, local MLA, and others. Everyone agreed that he should get a BPL card, by way of immediate relief.
True to the Jharkhand government's “gesture administration”, the District Collector instructed the BDO to do the needful. From then on, various officers (BDO, SDO, BSO, so-and-so) passed the buck to each other for a few months. Dablu's well-wishers pleaded his case all the way to Ranchi and even Delhi. Nothing doing — one year down the line, Dablu still didn't have a BPL card.
When the Commissioners of the Supreme Court swung into action and took the District Collector to task, he finally admitted that the entire district administration was powerless to give a BPL card to Dablu without striking someone else off the BPL list. He might as well have said it from the beginning — but that's another matter. The point is, the district has a “quota” of BPL cards, so no one can be inducted unless someone else is dropped. Someone quietly suggested that, since Dablu had become a VIP of sorts, he could perhaps be “adjusted” by removing someone else at random.
There rested the matter a few weeks ago, more than a year after a whole team of well-wishers (stretching from Latehar to Delhi) joined forces for Dablu. One shudders to think how many tonnes of grain putrefied in the FCI godowns in the meantime. Anyway, the local Block Supply Officer finally managed to identify a sacrificial lamb: someone on the BPL list in Dablu's village had died, and so had his wife, and their son already had a separate BPL card, so it seemed alright to strike that name from the list and accommodate Dablu. It took just another 10-15 days to complete the job — Dablu finally has a BPL card.
But there is a catch: Dablu may be deprived of his BPL card very soon. This is because the BPL list is supposed to be redone after the ongoing BPL Census (alias “Socio-Economic and Caste Census”) is completed. And the methodology of this Census is such that Dablu's family meets only one of the seven “deprivation indicators” that make up the BPL score. With a score of one on a scale of zero to seven, Dablu is almost certain to be excluded again.
And just to make it a little harder for Dablu to sneak into the exclusive club, the Planning Commission has made it clear (in its recent “striptease affidavit” to the Supreme Court) that the BPL list is expected to shrink over time, in line with official poverty estimates based on the government's measly poverty line of — roughly — Rs.25 per person per day in rural areas. This is what Dablu actually needs, as a bare minimum, for essential medical care alone.
Many States have rebelled against the Planning Commission's poverty straightjacket, and expanded the Public Distribution System (PDS) well beyond the BPL list. Had Dablu lived in Tamil Nadu, Andhra Pradesh, or even Chhattisgarh, he might not have gone through this ordeal. In Tamil Nadu, the PDS is universal — everyone has a ration card. Andhra Pradesh has rejected the BPL framework in favour of an “exclusion approach”, whereby everyone is eligible except those who meet well-defined exclusion criteria such as having a government job. Chhattisgarh, for its part, still uses an inclusion approach, but the inclusion criteria are quite broad (e.g. all SC/ST households are eligible) and the PDS covers nearly 80 per cent of the rural population. Further, the list of ration cards is regularly verified and updated.
In areas like rural Latehar, the case for a universal PDS is overwhelming. Indeed, except for a few exploiters (e.g. contractors and moneylenders), there are no rich people there — most of them move to urban areas, if only because they want decent schooling facilities for their children. In the villages, almost everyone is either poor or vulnerable to poverty. Further, the local administration is too inept, corrupt and exploitative to conduct a credible BPL survey or any sort of identification exercise. In these circumstances, a universal PDS makes a lot of sense.
The proposed National Food Security Act (NFSA) is an opportunity to end the BPL nightmare, and ensure that a family like Dablu's is entitled to a ration card as a matter of right. Unfortunately, the official draft of the NFSA perpetuates the entire BPL approach under a new name. Meanwhile, the government has lifted the ban on exports of wheat and rice, to “solve” the food crisis.
(The author is Visiting Professor at the Department of Economics, University of Allahabad
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August 12, 2011
JEAN DRÈZE
REETIKA KHERA
Labourers stack bags of wheat at an open FCI godown
at Sonepat in Haryana. File photo
While diversion rates still remain high, evidence seems to point to substantial improvements in the public distribution system around the country.
It is well understood that a substantial proportion of the grain, mainly wheat and rice, that is meant to be distributed to eligible families under the Public Distribution System (PDS) ends up being sold in the open market by corrupt intermediaries, including some dealers who manage PDS outlets. The extent of this “diversion” of PDS grain has been a matter of speculation for some time. Two recent surveys shed further light on the matter.
The diversion ratio (proportion of PDS grain “diverted” to the open market) has been estimated by several researchers in the past by matching National Sample Survey (NSS) data on household purchases with Food Corporation of India (FCI) data on “offtake.” The former tell us how much grain people are buying from the PDS. The latter tell us how much grain has been lifted by State governments from FCI godowns under the PDS quota. The difference is a rough estimate of the extent of diversion.
Based on this method, the estimated diversion ratio was around 54 per cent in 2004-05, the last year for which detailed data are available from a “thick round” of the NSS. Needless to say, this is an alarming figure. Tamil Nadu had the lowest diversion rate (around 7 per cent); the rate was well below the national average in the other southern States also (around 25 per cent in each case). By contrast, the estimated diversion rates ranged between 85 and 95 per cent in Bihar, Jharkhand, Assam, and Rajasthan. These estimates, if proved correct, suggest a comprehensive breakdown of the PDS in these States at that time.
Having said this, the reliability of NSS figures with respect to PDS purchases is not clear. There are two reasons to assume that they are not wildly off the mark. First, the State-wise averages for 2004-05 are broadly consistent with corresponding figures from the India Human Development Survey (IHDS) for the same year. Second, the inter-State patterns are more or less as one would expect, with, for instance, very little diversion in Tamil Nadu and a huge amount of it in Bihar. Nevertheless, this approach requires independent corroboration, not just because of the uncertain accuracy of NSS data, but also because of other difficulties in this method. Incidentally, among these difficulties is the utter lack of transparency in data on “offtake”: both the FCI and the Food Ministry seem to be doing their best to divulge as little as possible of it — they would do well to read Section 4 of the Right to Information Act.
Further evidence on these matters is available from a recent survey, conducted in June 2011 by student volunteers under our guidance (hereafter “PDS Survey”). The survey covered about 1,200 randomly-selected BPL households in nine sample States (Andhra Pradesh, Bihar, Chhattisgarh, Himachal Pradesh, Jharkhand, Orissa, Rajasthan, Tamil Nadu and Uttar Pradesh). The investigators were carefully trained to record the respondents' PDS purchases, in three different ways. The purchases were then compared with “entitlements” — what BPL households are supposed to get from the PDS in different States. For instance, BPL households are entitled to 25 kg of grain a month in Orissa and Rajasthan, and 35 kg a month in Chhattisgarh and Jharkhand. It turned out that in most States (with the notable exception of Bihar), BPL households were getting the bulk of their entitlements. The ratio of purchases to entitlements was 84 per cent in the sample as a whole. Here again, there were significant inter-State variations: this ratio was above 90 per cent in Andhra Pradesh, Chhattisgarh, Himachal Pradesh, Orissa and Tamil Nadu, but as low as 45 per cent in Bihar. The sample average of 84 per cent, however, suggests much lower rates of diversion (even in Bihar) than emerged from the earlier method — at least under the BPL quota.
The findings of this survey confirm other recent evidence of substantial improvements in the PDS around the country. In most of the sample States, there have been major initiatives in the recent past to improve the PDS, and it seems these efforts are showing results.
Also of interest are provisional figures on PDS purchases for 2009-10 (the latest “thick round” of the NSS) computed by the National Sample Survey Organisation. Starting with the good news, these figures suggest that on average PDS purchases of wheat and rice have more or less doubled between 2004-05 and 2009-10. This, again, is consistent with independent evidence of a revival of the PDS in recent years.
NSS-based estimates of diversion rates, however, remain high. Applying the method described earlier to these provisional figures, the diversion rate for 2009-10 seems to be around 41 per cent. This is 13 percentage points lower than in 2004-05, but still very high. The diversion rates improved (that is, declined) in almost every State, with big improvements in some States: down from 23 per cent to 8 per cent in Andhra Pradesh, from 85 to 47 per cent in Jharkhand, from 76 to 30 per cent in Orissa, and from 52 to 11 per cent in Chhattisgarh. Interestingly, these are four States where the PDS Survey also found evidence of major improvements. In 2009-10, none of India's major States had an estimated diversion rate higher than 75 per cent (the top rate, found in Bihar), in contrast with 2004-05 when as many as eight major States had that distinction.
This broad-based improvement is good news, but needless to say diversion rates remain unacceptably high. The question remains how these high diversion rates (41 per cent at the national level) square with the fact that BPL households in the PDS Survey were able to secure 84 per cent of their PDS entitlements. Even if the comparison is restricted to the nine sample States, a similar contrast applies.
There are at least two possible explanations. First, the PDS Survey is more recent: it took place two years after the NSS survey. And as mentioned earlier, there is consistent evidence of steady improvement in the PDS in recent years in many States. However, it is difficult to believe that progress has been so rapid as to explain, on its own, the full contrast between the two surveys. Second, the PDS Survey is restricted to BPL households in rural areas.
Diversion rates may be higher (possibly much higher) under the APL quota, and perhaps also in urban areas. Indeed, the APL component of the PDS, which has expanded steadily since 2004-05 (with a big upward jump in 2009-10), is devoid of any transparency. There are no specific entitlements for APL households, and no clear allocation norms. This segment of the PDS remains highly vulnerable to corruption, as it is possible for large quantities of grain to disappear without anyone feeling the pinch.
If this tentative line of explanation is correct, two conclusions can be drawn. First, both surveys (the PDS Survey, and the 66th Round of the NSS) add to growing evidence of steady improvements in the PDS in recent years. There is still a long way to go in achieving anything like acceptable levels of functionality, especially under the APL quota, but recent progress shows that the PDS is not a “lost cause” — far from it. Second, one thing that really helps to prevent corruption is to give people a strong stake in the system (large quantities, low prices), and make sure that they are clear about their entitlements. That has already happened, to a large extent, with the BPL quota: it has become much harder to cheat the recipients, because they know their due and clamour for it if need be. As Bhukhan Singh, a resident of Kope gram panchayat in Jharkhand, put it, when the price of PDS rice for BPL households in Jharkhand was slashed to Re. 1 a kg, awareness of the new entitlements spread quickly and people made up their mind that they “would not let this go.”
The recent turnaround of the PDS in Chhattisgarh (or, for that matter, Orissa) also built largely on this simple insight, as well as on the related fact that broad coverage strengthens public pressure for a functional PDS. There is an important lesson here for the proposed National Food Security Act.
Keywords: food supply, public distribution system, foodgrain diversion
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By Jean Dreze
Posted May 11th 2011
"Conditional cash transfers" (CCTs) are a new buzzword in policy circles. The idea is simple: give poor people cash conditional on good behaviour such as sending children to school. This helps to score two goals in one shot: poor people get some income support, and at the same time, they take steps to lift themselves out of poverty.
CCT enthusiasm, however, is often based on a superficial reading of the Latin American experience. In Brazil, Mexico and other pioneers of this approach, CCTs were used to bring into the fold of health and education services a fringe of marginalised households, in a situation where a large majority of the population was already covered by extensive social insurance systems. CCT is basically an incentive and, predictably enough, it often works: if you pay people to do something that benefits them anyway, they tend to do it. It is the same principle as scholarships for disadvantaged children. Incidentally, there is no evidence that scholarships — that is, conditional cash transfers — work better than “conditional kind transfers” like school meals or free bicycles for girls who complete Class 8. In fact, I submit that the latter would win hands down in any sensible and sensitive evaluation of the two approaches. Be that as it may, I am not questioning the potential effectiveness of CCTs in their limited capacity of “incentive”.
What is remarkably dangerous, however, is the illusion that CCTs can replace public services by enabling recipients to buy health and education services from private providers. This is not how CCTs work in, say, Brazil or Mexico. In Latin America, CCTs are usually seen as a complement, not a substitute, for public provision of health, education and other basic services. The incentives work because the services are there in the first place. In India, these basic services are still missing to a large extent, and CCTs are no substitute.
Consider, for instance, healthcare. In Brazil, basic health services such as immunisation, antenatal care, and skilled attendance at birth are virtually universal. The state has done its homework — almost half of all health expenditure in Brazil is public expenditure, compared with barely one quarter (of a much lower total) in India. In this situation, providing incentives to complete the universalisation of healthcare seems quite sensible. In India, however, public health services are virtually non-existent, and it would be very unwise to think that CCT-type programmes like the Rashtriya Swasthya Bima Yojana (RSBY) can fill the gap.
Another contextual difference, mentioned earlier, is that Latin American countries tend to have highly developed social insurance systems, with wide coverage. “Targeting” CCTs to marginalised groups in such a situation makes some sense, because the bulk of the population is already covered and the rest is (relatively) easy to identify. In India, however, large sections of the population are in dire need of social support, and the experience with targeting is quite sobering. Indeed, every known method of identifying “BPL” (below poverty line) households involves large exclusion errors. This is an unresolved issue for any targeted CCT initiative in India.
In short, a nuanced approach is required to the design of social security transfers. CCTs are useful in some circumstances: scholarships are one example. In other situations, like pensions for widows and the elderly, there is a case for unconditional cash transfers. Conditional transfers in kind, such as midday meals in primary schools, also have a role.
Finally, there is a place for unconditional transfers in kind, such as the Public Distribution System (PDS).
A wholesale transition from the PDS to cash transfers in rural India would, in my view, be misguided and at the very least premature. For poor people, food entitlements have several advantages over cash transfers. First, they are inflation-proof, unlike cash transfers that can be eroded by local price increases, even if they are indexed to the general price level. Second, food tends to be consumed more wisely and sparingly; cash, on the other hand, can easily be misused. Third, food is shared equitably within the family, while cash can easily be cornered by selfish individuals. Fourth, the PDS network has a much wider reach than the banking system. In remote areas, where the need for social assistance is the greatest, banking facilities are simply not ready for a system of cash transfers (as it is, they are unable to cope with NREGA wage payments). Last but not least, cash transfers are likely to bring in their trail predatory commercial interests and exploitative elements, eager to sell alcohol, branded products, fake insurance policies or other items that would contribute very little to people’s nutrition or well-being.
Of course, cash transfers have their advantages too: they have lower transaction costs, are (potentially) more convenient for migrant labourers, and may be easier to monitor. Sometime in the future, when the banking system has a wider reach and the food security problem has been resolved, a cautious transition to cash transfers may be advisable. Indeed, I am not averse to the idea of a “universal basic income”. But this is a somewhat futuristic idea, and for the time being, food is best.
The most common argument for cash transfers is that cash makes it possible to satisfy a variety of needs (not just food), and that people are best judges of their own priorities. Fair enough. But if people are best judges of their own interest, why not ask them whether they prefer food or cash? In my limited experience, poor people tend to prefer food, with a gradual shift from food-preference to cash-preference among better-off households. Further, poor people tend to give very convincing reasons for preferring food. I am more inclined to listen to them than to the learned champions of cash transfers.
The writer is an honorary professor at the Delhi School of Economics and a member of the National Advisory Council
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Unique facility, or recipe for trouble?
November 25, 2010
Jean Drèze
It is quite likely that a few weeks from now someone will be knocking at your doors and asking for your fingerprints. If you agree, your fingerprints will enter a national database, along with personal characteristics (age, sex, occupation, and so on) that have already been collected from you, unless you were missed in the “Census household listing” earlier this year.
The purpose of this exercise is to build the National Population Register (NPR). In due course, your UID (Unique Identity Number, or “Aadhaar”) will be added to it. This will make it possible to link the NPR with other Aadhaar-enabled databases, from tax returns to bank records and SIM (subscriber identity module) registers. This includes the Home Ministry's National Intelligence Grid (NATGRID), smoothly linking 21 national databases.
For the intelligence agencies, this will be a dream-come-true. Imagine, everyone's fingerprints at the click of a mouse, that too with demographic information and all the rest. Should any suspicious person book a flight, or use a cybercafé, or any of the services that will soon require an Aadhaar number, she will be on their radar. If, say, Arundhati Roy makes another trip to Dantewada, she will be picked up on arrival like a ripe plum. Fantastic!
‘A HALF-TRUTH'
So, when the Unique Identification Authority of India (UIDAI) tells us that the UID data (the “Central Identities Data Repository”) will be safe and confidential, it is a half-truth. The confidentiality of the Repository itself is not a minor issue, considering that UIDAI can authorise “any entity” to maintain it, and that it can be accessed not only by intelligence agencies but also by any Ministry. But more important, the UID will help integrate vast amounts of personal data, that are available to government agencies with few restrictions.
Confidentiality is not the only half-truth propagated by UIDAI. Another one is that Aadhaar is not compulsory — it is just a voluntary “facility.” UIDAI's concept note stresses that “enrolment will not be mandated.” But there is a catch: “... benefits and services that are linked to the UID will ensure demand for the number.” This is like selling bottled water in a village after poisoning the well, and claiming that people are buying water voluntarily. The next sentence is also ominous: “This will not, however, preclude governments or Registrars from mandating enrolment.”
That UID is, in effect, going to be compulsory is clear from many other documents. For instance, the Planning Commission's proposal for the National Food Security Act argues for “mandatory use of UID numbers which are expected to become operational by the end of 2010” (note the optimistic time-frame). No UID, no food. Similarly, UIDAI's concept note on the National Rural Employment Guarantee Act (NREGA) assumes that “each citizen needs to provide his UID before claiming employment.” Thus, Aadhaar will also be a condition for the right to work — so much for its voluntary nature.
Now, if the UID is compulsory, then everyone should have a right to free, convenient and reliable enrolment. The enrolment process, however, is all set to be a hit-or-miss affair, with no guarantee of timely and hassle-free inclusion. UIDAI hopes to enrol 600 million people in the next four years. That is about half of India's population in the next four years. What about the other half?
Nor is there any guarantee of reliability. Anyone familiar with the way things work in rural India would expect the UID database to be full of errors. There is a sobering lesson here from the Below Poverty Line (BPL) Census. A recent World Bank study found rampant anomalies in the BPL list: “A common problem was erroneous information entered for household members. In one district of Rajasthan, more than 50 per cent of the household members were listed as sisters-in-law.”
Will the UID database be more reliable? Don't bet on it. And it is not clear how the errors will be corrected as and when they emerge.
Under the proposed National Identification Authority of India Bill (“NIDAI Bill”), if someone finds that her “identity information” is wrong, she is supposed to “request the Authority” to correct it, upon which the Authority “may, if it is satisfied, make such alteration as may be required.” There is a legal obligation to alert the Authority, but no right to correction.
The Aadhaar juggernaut is rolling on regardless (and without any legal safeguards in place), fuelled by mesmerising claims about the social applications of UID. A prime example is UID's invasion of the NREGA. NREGA workers are barely recovering from the chaotic rush to payments of wages through banks. Aadhaar is likely to be the next ordeal. The local administration is going to be hijacked by enrolment drives. NREGA works or payments will come to a standstill where workers are waiting for their Aadhaar number. Others will be the victims of unreliable technology, inadequate information technology facilities, or data errors. And for what? Gradual, people-friendly introduction of innovative technologies would serve the NREGA better than the UID tamasha.
The real game plan, for social policy, seems to be a massive transition to “conditional cash transfers” (CCTs). There is more than a hint of this “revolutionary” plan in Nandan Nilekani's book, Imagining India. Since then, CCTs have become the rage in policy circles. A recent Planning Commission document argues that successful CCTs require “a biometric identification system,” now made possible by “the initiation of a Unique Identification System (UID) for the entire population …” The same document recommends a string of mega CCTs, including cash transfers to replace the Public Distribution System.
If the backroom boys have their way, India's public services as we know them will soon be history, and every citizen will just have a Smart Card — food stamps, health insurance, school vouchers, conditional maternity entitlements and all that rolled into one. This approach may or may not work (that is incidental), but business at least will prosper. As the Wall Street Journal says about the Rashtriya Swasthya Bhima Yojana (which is a pioneering CCT project, for health insurance), “the plan presents a way for insurance companies to market themselves and develop brand awareness.”
THE DANGER
The biggest danger of UID, however, lies in a restriction of civil liberties. As one observer aptly put it, Aadhaar is creating “the infrastructure of authoritarianism” — an unprecedented degree of state surveillance (and potential control) of citizens. This infrastructure may or may not be used for sinister designs. But can we take a chance, in a country where state agencies have such an awful record of arbitrariness, brutality and impunity?
In fact, I suspect that the drive towards permanent state surveillance of all residents has already begun. UIDAI is no Big Brother, but could others be on the job? Take for instance Captain Raghu Raman (of the Mahindra Special Services Group), who is quietly building NATGRID on behalf of the Home Ministry. His columns in the business media make for chilling reading. Captain Raman believes that growing inequality is a “powder keg waiting for a spark,” and advocates corporate takeover of internal security (including a “private territorial army”), to enable the “commercial czars” to “protect their empires.” The Maoists sound like choir boys in comparison.
There are equally troubling questions about the “NIDAI Bill,” starting with why it was drafted by UIDAI itself. Not surprisingly, the draft Bill gives enormous powers to UIDAI's successor, NIDAI — and with minimal safeguards. To illustrate, the Bill empowers NIDAI to decide the biometric and demographic information required for an Aadhaar number (Section 23); “specify the usage and applicability of the Aadhaar number for delivery of various benefits and services” (Section 23); authorise whoever it wishes to “maintain the Central Identities Data Repository” (Section 7) or even to exercise any of its own “powers and functions” (Section 51); and dictate all the relevant “regulations” (Section 54).
Ordinary citizens, for their part, are powerless: they have no right to a UID number except on NIDAI's terms, no right to correction of inaccurate data, and — last but not least — no specific means to redress grievances. In fact, believe it or not, the Bill states (in Section 46) that “no court shall take cognisance of any offence punishable under this Act” except based on a complaint authorised by NIDAI.
So, is UID a facility or a calamity? It depends for whom. For the intelligence agencies, bank managers, the corporate sector, and NIDAI, it will be a facility and a blessing. For ordinary citizens, especially the poor and marginalised, it could well be a calamity.
(The author is Visiting Professor at the Department of Economics, University of Allahabad and Member of the National Advisory Council.)
RELATED TOPICS
politics
espionage and intelligence
human rights
science and technology
identification technology
COMMENTS:
Thank you Jean Dreze for taking this issue to limelight. It seems, UIDAI need to perform more outreach and public participation in its embryonic stage. They better be doing that! I agree with your point of great Indian "Tamasha" but do not like the total dependency of your article on what UID implies and cannot do. Primarily, it sounds like once having UID makes "all is well" with people! It is nice you brought the matter of legal tranche of UID and needs further restructuring. Inter alia, UID alone is not a employee guarantee scheme, rather it meant for better system delivery and avoid corruption. I am working in development field, we are learning to know the current public service delivery is crippling and bears no moral obligation for equity. Further, public services does not ensure adequacy and accountancy in the governance system. I view UID as more like technical and policy issue to run effective services while resolving our problems of corruption and inequity. It is not employment scheme!! Politicians may be using it as "Adhaar" and for other purposes, so the other part of society including media, publishers, or academicians make churn out some other differential meaning of UID. But what is crucial and detrimental to the task of development has to be done effectively and intelligently. And UID is one such step!
Thank you for the article again.
from: Arun Bhandari
Posted on: Nov 25, 2010 at 12:45 IST
I am more than convinced that UID will be more used by the Government for keeping the citizens under watch than doing any good for public. If they are going to make this card a must for many other programmes like the NREGA, then definitely it will be yet another Indian tamasha - you know why? because they already want this card like a must requirement and at the same time they want it to reach only half of Indian population in the next 4 years. With each and every new Government or school of thought in Indian Govt. we are looking at a new identity card for India. First it was the election ID card which is full of mistakes. I happen to be from Alleppey district in Kerala, where already they took our details for this card. When we went to take the photograph and the finger and eye scans, I found out that 90% of my details entered were wrong. I was just lucky that I saw it by accident and the person kindly changed them. But most poor people would not recognise these mistakes and I am sure they are all going to have a tough time ahead convincing authorities for a change or its not their mistake.
from: Rajesh
Posted on: Nov 25, 2010 at 16:16 IST
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