In 2016, on my way to Salem (Tamil Nadu), I decided to stop for breakfast from an ‘Amma canteen’ in Rasipuram town (Namakkal district). The food was hygienic, delicious and extremely cheap. I was very appreciative of such government initiatives until the matter of ‘choice’ started haunting me. Are such programmes where the government gets to decide a poor person’s menu sustainable in the long run? Why are we not able to equip him financially so that he can make choices for himself? At least the basic choices like food.
A recent UNDP report praised India for its momentous efforts to pull 271 million people out of poverty in just ten years. Before the echo of cheers dies down, let’s also take note of a recent Oxfam report that points to rising economic inequalities in India. It claims that the richest 1% accrued 73% of wealth generated in 2017. Worse still, it placed India among the last 15 in Oxfam World Inequality Index (commitment to reduce inequality). Now it’s time for us to introspect as to where we are lagging. What is going wrong with us? There are a few simplistic inferences that can be made from the studies mentioned above. First is that persons with ‘Investable capital’ have their way in wealth generation. Secondly, we have to come up with some imaginative ways to facilitate resource transfer from rich to poor. This is to say that we need structural adjustments in government policies, taxation and other resource mobilisation techniques.
Being democratic and socialistic shall go hand in hand to address the socioeconomic inequality in India. This is important because there are instances of peer countries like China and Russia attempting to bring about equality through coercive measures such as compulsory take over of resources by the state, payment of salaries in kind, collective farming and the like. A more heterogeneous Indian society would not be able to sustain the hostilities and struggles that such actions create. Therefore, the resource flow from rich to poor shall be a smooth affair in India. This article is an attempt to suggest some fresh initiatives which can potentially make our development journey more egalitarian.
Individuals who are willing to contribute by their own free will can be brought under one umbrella. This can be done in a decentralised manner at the local level such as panchayats, or it can also be hierarchical such as district, state and national level. With the sheer number of ‘well to do citizens’ in India, this initiative will enable significant resource mobilisation. It is to be kept in mind that the contributors will not enjoy any special privilege over the assets created other than goodwill from the community. This good Samaritan attitude shall be ingrained into the future generations as part of an essential national character. Appropriate mechanisms including all stakeholders such as elected representatives and contributors shall be in place to ensure transparency in selecting the work and allocation of money from the fund.
Since we are talking of resource sharing and mobilisation, their optimal utilisation and wastage need to be prevented as well. We can
In a predominantly agricultural country (nearly 49% workforce) even the rich farmers are excluded from taxation. When we read this along with the fact that the big farmers arrogate benefits of most of the farm subsidies in India, the distributional injustice becomes clearer. It is high time that India should go for more targeted agricultural policies. The Minimum Support Price (MSP), farm subsidies such as power subsidies, fertiliser subsidies, farm loan waivers etc. are to be only for the deserving vulnerable sections.
As a test case for revamping government schemes, let us consider the MGNREGS. What can be done here is to make it partially government funded and partially private funded. Registered big farmers can be allowed to avail the labour from MGNREGS provided that they agree to pay for the minimum amount payable to a worker under MGNREGS. This will unburden the government of huge economic costs while availing cheap labour for the big farmers. The beauty is the fact that resource flow is facilitated in a systematised way without bondage and labour exploitation.
Changes can be brought in the reservation policies of the government to limit the availability of reservation either for job or education for a single individual, setting up of economic capacity as criteria and the sub-categorisation of beneficiary communities.
The World Bank says that women who earn – invest more in the next generation. The sad reality in India is that women own little resources in a traditionally patriarchal Indian society. For example, women own less than 2% of the farmland in India as per India Human Development Survey (IHDS). To reverse this trend, carefully chosen sectors such as labour-intensive food processing, apparel and cotton textiles can be given incentives such as tax rebates if women own the assets. Along with this, massive state investment in Self Help Groups (SHG) by making them a part of the governing structure such as government procurement etc. will help
State universities where more than 90% of ‘India’s to-be graduates’ study are crunched of funds. For example, when this person I know studied B tech in 2011 from a government engineering college in Thiruvananthapuram the fee used to be 6400/year which more or less remains the same to this date. The same course in National Institute of Technology (NIT) Calicut offers it at 35000/year now. The point to make is that centrally funded institutions have more or less competent fee structure while also receiving central funds – which is not the case with state universities. We need a thorough overhaul in fee structure to enable ‘cross funding and subsidisation’ wherein poor students can be exempted from fee altogether, whereas well to do individuals share more burden. To identify who will benefit from fee exclusion, SECC (Socio-Economic Caste Census) data of 2011 can be used.
At least a 6-month internship with the industries shall be a compulsory part of the curriculum. It can be designed in such a way that the emphasis is both on acquiring skills as well as adapting to a dynamic technological environment where one needs to be a continuous learner. This internship can be considered as their final year project as well.
Once an entrepreneurial mindset is cultivated and initial capital support is given, more and more ideas will take real shapes. If we assume that at least 10% of them are successful, they will garner investments from people who have ‘investable capital’. Again smooth and peaceful flow of resources!
In sectors such as renewable energy, countries in Europe such as Denmark (Wind energy) and Germany (Solar energy) had come up with some replicable models where the assets are owned collectively by the community, the electricity is collectively sold and the profit collectively distributed. Since India has committed itself to a renewable energy path by declaring its Nationally Decided Contributions (NDCs) in Conference of Parties (COP-21) of United Nations Framework Convention On Climate Change (UNFCCC), decentralised models like these are to be embraced.
Gandhiji’s idea of ‘trusteeship’ is very famous. Though it may seem too idealistic to implement, the universalism and futuristic outlook in it requires applause from the present generation. He envisaged industrialists and businessmen to be mere custodians of the community’s assets. Though they are free to keep profit generated for reinvestment and sustenance of business, a part is to be given back to the society. A practical manifestation of the same principle can be seen in today’s Corporate Social Responsibility (CSR), but the need of the hour is that profit-oriented mindset takes a backseat.