A Universal Basic Income (UBI) will be an efficient substitute for a plethora of existing welfare schemes and subsidies, according to India's annual Economic Survey, the Hindu reports.
In a chapter ‘Universal Basic Income: A Conversation With and Within the Mahatma,’ the Survey dwelt at length on the pros and cons of introducing UBI in India before concluding that it was “a powerful idea whose time even if not ripe for implementation is ripe for serious discussion.”
The report justified the introduction of UBI citing several reasons such as promoting social justice, reducing poverty and an unconditional cash transfer that lets the beneficiary decide how she uses the money and generating employment by promoting labour flexibility since it allows “individuals to have partial or calibrated engagements with the labour market without fear of losing benefits.”
It also said the move would bring in administrative efficiency as a direct cash transfer through a JAM (Jan Dhan-Aadhar-Mobile) platform would be more efficient compared to the “existing welfare schemes which are riddled with misallocation, leakages and exclusion of the poor.”
The report advocated a “target quasi-universality rate of 75%,” which would entail a cost of 4.9-4.2% of the GDP, well within the ball park of 5% of the GDP, which is what existing centrally sponsored schemes cost the exchequer.
According to Professor Guy Standing, a founding member of the Basic Income Earth Network, told Business Insider UBI trials in India had been “remarkably positive”, giving people a sense of control over their money, reducing debt and empowering women, the Independent adds.