Business News
Rs 1 lakh cr transactions, Rs 57,000 cr savings this year: DBT is a clear winner for Narendra Modi govt
Direct benefit transfer (DBT) is emerging as a clear winner for the Narendra Modi government in this financial year. Here’s how the story has worked out so far: Total DBT transactions, or the amount government transfers directly to citizens under various state-sponsored schemes, has reached Rs 84,802 crore so far in the current financial year (2017-18). That’s compared with Rs 74,707 crore in the financial year 2016-17, Rs 61,942 crore in 2015-16 and Rs 38,926 crore in the fiscal year before that.
In other words, within a period of four financial years, the DBT amount has more than doubled and in the current financial year, as the trend suggests, the amount might cross well over one lakh crore as this Economic Timesreport suggests.
Right now, there are 400 schemes under DBT with major components being the MGNREGA and cooking gas subsidy scheme (LPG Pahal). Together, these constitute 50 percent of total DBT transactions this year against 71 percent in last year.
The total savings of the government in the financial year 2016-17 has risen to Rs 57,029 crore compared with Rs 36,144 crore last year. Of this chunk, the biggest savings gain has come from the cooking gas subsidy scheme (Rs 29,769 in 2016-17 up from Rs 21,584) followed by food and public distribution (Rs 14,000 crore compared with Rs 10,191 crore during the period). The number of total beneficiaries rose to 59.34 crore in the current fiscal year so far from 35.7 crore in the previous financial year.
The progress of DBT is encouraging. For several years, government benefits weren’t reaching the needy on the ground or, at least, only part was. This was mainly on account of middle men operating on the ground. The poor had to knock on the doors of government offices multiple times to get what is rightfully due to them. This problem is largely addressed with DBT gaining pace, also aided by the JAM trinity (Jan Dhan, Aadhaar and Mobile number).
With most central schemes on board of the DBT, the next logical step is to bring state-level schemes too under the DBT ambit, as the ET report cited above quotes a government review meeting held last month. As of now, only a fraction of the total number of state-level schemes is under the DBT ambit. The DBT success also shows why survival of Aaadhar, whose validity is under the examination of the Supreme Court, is important.
If one looks at the major economic moves of the Narendra Modi government in three and half years, GST (Goods and services Tax) may take the trophy home. But subsidy rationalization aided by Aadhaar-enabled DBT programme will be the winner if the yardstick is changed to the initiative that benefited the poor most and kicked the middlemen nexus out.
