It has been raining welfare schemes over the past five years. Prefaced by the term ‘Pradhan Mantri’, several pet projects and schemes of Modi have made their debut in the Budget every year — a powerful lesson in political branding indeed for the uninitiated! These include key schemes such as the Pradhan Mantri Jan Dhan Yojana, the Pradhan Mantri Awas Yojana (Urban) (the ‘housing for all’ scheme) and the much-touted Ayushman Bharat. The progress of these schemes has not been similar and each one still needs to go a long way before achieving its intended purpose.

Financial inclusion has been high on the agenda of the BJP-led government and it sought to achieve this with the Pradhan Mandtri Jan Dhan Yojana. The biggest-ever bank account opening drive did yield some results, with 8 crore accounts opened within 100 days. The current tally of accounts, which is a little over 33 crore, is no mean feat.

But opening of such accounts alone does not guarantee financial inclusion. Between 2010 and 2013, close to 110 million ‘basic savings bank deposit accounts’ had been opened, but the balances in these accounts had grown by a meagre 10 per cent annually. Hence, dormancy was a key issue in the past, which, to some extent, appears to have been addressed under the Jan Dhan scheme with the routing of subsidies through these accounts. As per latest data available, close to 76 per cent of the 33 crore accounts under Jan Dhan are operative. This is a key positive. But for the government, the biggest challenge will lie in incentivising and nudging the banks to provide credit to rural markets in a cost-effective way.

The Pradhan Mantri Awas Yojana (Urban) [PMAY (U)] is another scheme that has drawn lot of attention. In 2015, the Centre announced the Credit Linked Subsidy Scheme (CLSS) under PMAY(U), offering an interest subvention of 6.5 per cent on housing loans up to ₹6 lakh for a tenure of 20 years to the economically weaker sections (EWS) and low income groups (LIG). Subsequently, the scope of the CLSS was widened to include the middle-income category. Effective January 1, 2017, the scheme for MIG was rolled out, with an upfront interest subsidy of up to ₹2.3-2.35 lakh to borrowers, covering two income segments — ₹6,00,001 to ₹12 lakh (MIG-I) and ₹12,00,001 to ₹18 lakh (MIG-II) per annum.

There has been a sharp rise in beneficiaries under the CLSS. The Ministry of Housing and Urban Affairs has stated that till date, there were 3,22,713 beneficiaries to whom a subsidy of ₹7,118 crore has been disbursed.

But the Centre has not increased allocation for the interest subsidy under the CLSS in FY20. After allocating ₹1,900 crore for FY19 and using up ₹1,800 crore, the Centre has allocated only ₹1,000 crore in FY20, which is surprising.

Also, while the Centre may have resolved the demand-side issues to some extent by offering interest subvention for low-ticket home loans, supply constraints remain. India’s urban housing shortage is pegged at about 1 crore. With the rate at which houses under the PMAY(U) are being sanctioned and constructed, meeting the housing shortage by 2022 appears a tall ask.

According to latest data (as on December 10, 2018) 65,44,135 houses have been sanctioned to be constructed by States/UTs under the PMAY (U), and so far, 12,44,533 houses have been constructed.

Not a numbers game

The mega health insurance scheme — Ayushman Bharat (Pradhan Mantri Jan Aarogya Yojana-PM-JAY) — which was announced in last year’s Budget with a lot of fanfare, has made notable headway in providing the poor access to healthcare services. The latest numbers suggest that so far ₹1,357 crore worth treatment has been provided to more than 10 lakh patients under the PM-JAY. But then this is not a numbers game. If the real intent of the Centre is to provide sustainable financial protection and adequate health insurance coverage to the poor through this scheme, then the focus needs to shift from just back-patting on spectacular claim figures to creating a robust system that minimises frauds, eases up processes, quickens the claims approval process and incentivises greater participation from the private sector. Also, after allocating ₹2,400 crore for the scheme in FY19, the Centre has allocated ₹6,400 crore for FY20, which may need to be revised, if the scheme scales up significantly.

Related Topics
comment COMMENT NOW