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Saturday, June 12, 2021

Why Covid is a reality check for Modi’s flagship welfare schemes

While 10.35 crore PM-JAY Cards have been issued since the launch of ‘the world’s largest health assurance scheme’ in September 2018, it has proved to be of little use in the ongoing Covid-19 epidemic.

Written by Harish Damodaran |
Updated: May 12, 2021 8:29:30 am
The only new big-ticket scheme unveiled during the Modi government’s second term is Har Ghar Jal. Announced in the 2019-20.

The Bharatiya Janata Party won 303 seats in the 2019 Lok Sabha elections, more than the 282 it got in 2014. This return to power with a larger majority was significantly enabled by the various programmes undertaken during the Narendra Modi government’s first term for fulfilling the basic needs (“zindagi ki aavashyaktayen”) of ordinary people (“saamanya maanav”).

Modi’s tenure as prime minister has generally been marked by slowing growth — from 8 per cent in 2016-17 to 6.2 per cent, 5.9 per cent, 4.1 per cent and minus 6.5 per cent in the subsequent four years — and worsening terms of trade for agriculture. Rural wages, too, have grown just 4.8 per cent annually in nominal and 0.1 per cent in real (inflation-adjusted) terms over the last seven years, as against an average of 15.3 per cent and 5.1 per cent during 2007-08 to 2013-14.

But these negatives have been largely offset by the Modi government’s relative success at targeted delivery of benefits and asset creation through its flagship schemes.

Thus, 11.35 crore household toilets got built under the Swachh Bharat Mission after October 2, 2014. Likewise, 42.31 crore bank accounts were opened under Jan Dhan Yojana (launched in August 2014), 8.03 crore free LPG connections released under Ujjwala (May 2016) and 2.63 crore households electrified under Saubhagya (October 2017). Besides, 2.11 crore rural houses were constructed between 2014-15 and 2020-21 under Pradhan Mantri Awaas Yojana (PMAY) and 2.82 lakh km of road length completed under Pradhan Mantri Gram Sadak Yojana (PMGSY).

These programmes, implemented in mission mode, achieved near saturation coverage: Only 18,734 out of the country’s total 21.45 crore rural households are still to be electrified; LPG penetration has risen from 56 per cent in 2015 to 99.5 per cent in 2020; and 100 per cent of village homes now have toilets (at least on paper), as against 38.7 per cent in October 2014. Their focused execution — be it through real-time performance monitoring dashboards, geo-tagging of assets, or special drives such as the Gram Swaraj Abhiyan in 21,058 identified villages from April 14 to May 5, 2018 — also paid off politically, helping cultivate a pro-poor image for Modi nationally during his first term.

Modi’s second term, however, hasn’t seen much by way of flagship welfare schemes, old or new.

Ujjwala’s benefits have been considerably eroded by LPG cylinder prices rising from Rs 527-555 to Rs 809-836 in the last five years. The Centre’s LPG subsidy budget itself has been slashed from Rs 39,054.79 crore in 2020-21 to Rs 14,073.35 crore for the current fiscal. Rural houses built under PMAY peaked at 44.55 lakh in 2017-18 and 47.33 lakh in 2018-19. But they fell post the 2019 elections to 21.92 lakh in 2019-20 and 35.28 lakh in 2020-21. Even out of the 35.28 lakh, the two states going for assembly polls — Bihar and West Bengal — accounted for 10.49 lakh and 6.79 lakh, respectively. The completed road length under PMGSY, which averaged 48,369 km during 2016-17 to 2018-19, also dropped to 27,305 km in 2019-20 and 36,677 km in 2020-21.

The diminishing effectiveness of the Modi-I flagship schemes is equally apparent with regard to PM-Kisan: The Rs 6,000-per-year direct transfer to 10 crore-plus farming households has been greatly neutralised by the increased cost of diesel, fertilisers and pesticides. Retail prices of diesel alone have soared by roughly 25 per cent since the scheme took off in December 2018, just before the 2019 elections.

Even more glaring is Pradhan Mantri Jan Arogya Yojana (PM-JAY), which provides a cover of Rs 5 lakh per family per year for medical treatment in empanelled government as well as private hospitals. While 10.35 crore PM-JAY Cards have been issued since the launch of “the world’s largest health assurance scheme” in September 2018, it has proved to be of little use in the ongoing Covid-19 epidemic. The lack of hospital infrastructure itself has been the single biggest deterrent to the success of this programme that, on paper, extends free and cashless insurance for secondary and tertiary care to over 50 crore beneficiaries. Nor have the performance dashboards — which could so effectively track the Modi government’s flagship programmes down to the gram panchayat and individual beneficiary level — worked their magic this time, whether in coordinating oxygen supplies, allocating ICU beds or stepping up vaccination coverage.

The only new big-ticket scheme unveiled during the Modi government’s second term is Har Ghar Jal. Announced in the 2019-20 Union Budget, it aims at providing drinking water to every rural home in India by 2024. The progress so far, again on paper, is quite impressive. Since the start date of August 15, 2019, the total households with tap water connections have more than doubled from 3.24 crore (16.86 per cent coverage) to 7.41 crore (38.59 per cent).

It remains to be seen, though, if Har Ghar Jal can deliver political dividends like the assortment of strategically deployed schemes of Modi-I did. In his 2019 Independence Day address, Modi had talked of graduating from fulfilling people’s “zindagi ki aavashyaktayen” to meeting their “aakaankshayen” (aspirations). However, much of the first year of his new term was devoted not to the economy, jobs and incomes. Instead, it was focused on the Article 370 abrogation, Citizenship (Amendment) Act, criminalisation of Triple Talaq and the Ram Mandir settlement. By the time the focus was back on growth, corona had struck.

If the results of the latest state elections are any indication, Brand Modi — more specifically, the assiduously cultivated pro-poor image — is beginning to fray at the edges. The biggest challenge before the ruling dispensation is going to be mending the economy, especially after the havoc wreaked by Covid. While “schemes” and their intelligent political marketing can help, they cannot substitute for anemic growth and falling incomes beyond a point. And when the schemes themselves are losing vitality — it was the UPA-era MGNREGA and free foodgrains, not Jan Dhan cash transfers, that provided succour during lockdown — there’s all the more reason to worry.

This column first appeared in the print edition on May 12, 2021 under the title ‘A Yojana reality check’. The writer is National Rural Affairs & Agriculture Editor at The Indian Express and on sabbatical as Senior Fellow with the Centre for Policy Research

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