Universal Basic Income (UBI) - Editorial

Wednesday, January 16, 2019 3:30 AM

Introduction

Ideological of Universal Basic Income (UBI) has gained popularity in western countries because of the initiation of automation and its association with fear of Job losses and unexpected increase in unemployment.

In India the Universal Basic Income (UBI) is considered to be the solution for the prolonged chronic poverty and series of Government failures to target subsidies to less unfortunate citizens and poor.

Universal Basic Income (UBI)

Universal Basic Income (UBI) can be considered as the minimum income one requires to fulfil his daily necessities. UBI once implemented successfully across the country will provide, regular and periodic cash payment into the bank accounts provided to all Indian citizens irrespective of their employment status. There are many think tanks working towards formalisation of the scheme. This should also be made available post education (undergraduation/graduation) till individual finds the job.

The State of Sikkim is going to run the pilot process of UBI, towards actualization of Universal Basic Income (UBI). This is major leap towards Right to Basic Income to cover their everyday requirements and reduce the poverty, under the title Being Citizen.

This ambitious project has “Five Broad Features”, such as …

  • Payments at Periodic Regular Intervals (not one-off grants) e.g. Monthly payments,
  • Payments in Cash i.e. deposits in Bank Accounts (not food vouchers or service coupons),
  • Payments to Individual Entity
  • Universality/ Uniform process
  • Unconditionality ( no condition of cast, religion and education or employment status

UBI Vs Regular Farm Loan Waivers

Farm Waiver is temporary relief to take the burden off the shoulders of the Indian farmers, but certainly not a good practice. Farm Waiver is temporary fix for Rural Poverty the collective protest and demands from the opposition parties in India. This is very bad practice of the economics. Measures like Farm Waivers will eventually drain the nation’s treasury and eventually will bring down the entire economic structure at some point, if not sooner. Such schemes are populist in nature and contagious from economic perspectives. For example, considering the fact, if certain type of loan is non-repayable and needs to be bailed out by the government intervention then why not other types of loans be bailed out.

  • Thinking of the long term, the financial institutions in India would stop lending loans or stop loan availability to Small-Scale Farmers.
  • Thus UBI would be more equitable or fill the gap (rationally) of addressing the rural tragedy.
  • The Rythu Bandhu Scheme* started in state of Telangana Govt. served as the groundwork for the Income Support Scheme for farmers in India does not disrupt market or stir the equilibrium of credit culture.
  • The RBS however kept away the tenant farmers/croppers, they consist the considerable number of** 13.7%** of total farm land holding in India.
    Unlike farm loan waivers or minimum support prices for specific crops, a Rythu Bandhu -type income support scheme does not damage credit culture or distort markets.

Advantages from Basic Income Provision

Certain level of studies and pilot implementation of the programme, has reported various advantages associated with provision of Universal Basic Income (UBI) to many people as such.

  • Firstly it was reported, those suffering from poverty managed to get out of that grip and had increased Nutrition Intake. The Universal Basic Income (UBI) enable the rise in daily food consumptions (Meat, Vegetables, Pulses and Milk products).
  • Secondly, the beneficiaries of the Universal Basic Income (UBI) allowed people to spend money on healthcare, resulting in healthy individual and less occurrences of illness and death incidents due to health issues.
  • The other important indicator was the education, this section saw multiple and regular enrolment in schools and colleges, specially girls/women student enrollment.
  • Universal Basic Income (UBI) stood up to the expectation of minimizing the gap between rich and poor and a step towards equitable development.
  • UBI provided the required boost and motivation for rural population to work hard than earlier and it was observed that people try multiple economic options with the provided Basic Income.
  • The prolonged illness of indebtedness was at ease, funds saving capacity increased and placed people a better financial situation or position.
  • Basic Income might act as the Economic Security and to some extent Social Security for unfortunate crowd (weak, mentally and physically challenged, etc.)
  • Basic Income also acts as the stronghold or “Economic Intravenous therapy (IV )” for youth who are skilled and has required education but to due unfortunate events or market situation, not able to locate or find jobs, or get employment. UBI will be hand holding to these people while the hard days are passed by.

Conclusion

The combination of National Food Security Act, MGNREGA and Universal Basic Income bundled together will make fruitful combination for overall growth of the country. Moreover the Govt. of India reached to the conclusion of use Universal Basic Income as powerful tool, for poverty reduction from in India. Everyone gain from modest basic income is the objective to certain extent. Universal Basic Income (UBI) foresees the equitable society with uncompromised social safety net, in order to assure respectable and dignified life experience for everyone.

Important Links (Internal)

  1. Universal Basic Income (UBI)

Important Links (External)

  1. Universal Basic Income (UBI) India - wikipedia.org.
  2. Universal Basic Income (UBI) - By Saksham Khosla.
  3. Economic Survey: Universal Basic Income (UBI) Scheme - Press Information Bureau (PIB).

Now after BJPs massive win, UBI shall take shape soon enough.