ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Are Our Contributory Pension Schemes Failing the Poor?

The issue of old age income security in India assumes significance in view of the expected rise in the incidence of elderly population in the years to come, problems of poverty and vulnerability among them and their limited coverage by the existing old-age pension schemes. Schemes aiming to promote contributions from the poor unorganised workers for their old age security have been promoted by the government since 2010. By comparing and contrasting the design features of India’s two contributory pension schemes, National Pension System Lite and Atal Pension Yojana, and discussing the strengths and limitations of each of these schemes in addressing the needs of low-income workers with the help of available data and studies, we argue that the design features of these schemes are such that they fail to take the specific characteristics of unorganised worker households into account. We also discuss how the current design of contributory social security schemes can be improved to meet the pension requirements of unorganised workers.

Implementing Health Insurance: The Rollout of Rashtriya Swasthya Bima Yojana in Karnataka

The National Health Insurance Scheme - Rashtriya Swasthya Bima Yojana - aims to improve poor people's access to quality healthcare. This paper looks at the implementation of the scheme in Karnataka, drawing on a large survey of eligible households and interviews with empanelled hospitals in the state. Six months after initiation in early 2010, an impressive 85% of eligible households in the sample were aware of the scheme, and 68% had been enrolled. However, the scheme was hardly operational and utilisation was virtually zero. A large proportion of beneficiaries were yet to receive their cards, and many did not know how and where to obtain treatment under the scheme. Moreover, hospitals were not ready to treat RSBY patients. Surveyed hospitals complained of a lack of training and delays in the reimbursement of their expenses. Many were refusing to treat patients until the issues were resolved, and others were asking cardholders to pay cash. As is typical for the implementation of a government scheme, many of the problems can be related to a misalignment of incentives.

Putting the Cart before a Non-Existent Horse

The NCEUS report is an important step towards bringing unorganised sector workers under some form of social protection. However, the cart of a social security system needs three galloping horses to take it to the destination of a deprivation-free unorganised worker: viable enterprises, successful poverty alleviation programmes and congenial macro policies, none of which is in sight.

Unorganised Workers

Provision of social security to the unorganised workers is currently receiving the urgent attention of the central government and some of the state governments. This paper, based on a large sample of unorganised workers - construction workers, domestic workers and agricultural labourers - from Karnataka, presents indices of their economic conditions and deprivation to show how inadequate it is to use the below poverty line criterion for providing benefits to unorganised sector workers. The priority social security needs are analysed to show the diversity within and across sectors, and to review the policy measures - existing and those on the anvil.

Banking Sector Reform and Credit Flow to Indian Agriculture

Have banking sector reforms improved the share of net bank credit to the agricultural sector? Have profit-oriented norms persuaded commercial banks to neglect the agricultural sector? Does the provision of a credit subsidy reduce the supply of agricultural credit? Can an increase in the lending rate be a suitable measure to reduce the rate of credit subsidy? What is the interest rate elasticity of supply of agricultural credit? What has been the impact of the closure of rural bank branches on the provision of credit to agriculture? This paper addresses these questions by analysing the data on the total outstanding credit provided by the scheduled commercial banks to the agricultural sector during the period 1981 to 2000.

Changing Face of Beedi Industry

The beedi industry in the Dakshina Kannada district of Karnataka is rapidly undergoing substantial changes, with some units shifting out of the area. What is the nature of the change? What impact will this have on the local population, a large proportion of whom, especially the poor are employed in the industry?

Economic Programmes and Poverty Reduction

This paper analyses the impact of the economic programmes of SHARE, an NGO in Tamil Nadu, on poverty reduction, with the help of data collected from the households of 84 women members. The economic programmes contributed to savings and income increase for the women. However, the member group was not found to be significantly different from the comparison group in terms of control over income and decision-making.

Land Use Pattern and Agrarian Expansion in a Semi-Arid Region-Case of Rayalaseema in Andhra, 1886-1939

This article attempts to trace the land use pattern and agrarian expansion in Rayalaseema during the late 19th and early 20th centuries, and argues that demographic, market-related and infrastructural factors were equally responsible for the outcome.

Half-Life of Credit-Simulating Fund Flows in Priority Sector

Simulating Fund Flows in Priority Sector D Rajasekhar Vinod Vyasulu Based on secondary sources and primary data this paper seeks to elaborate the concept of half-life of credit analytically and establishes by simulating flow of loanable funds under different assumptions the time needed for these funds to reach their half-life and examines the factors contributing to the lengthening or shortening of the half-life of credit in Indian banking.

Towards a Political Economy of the Economic Policy Changes

Towards a Political Economy of the Economic Policy Changes Vinod Vyasulu Sukhpal Singh D Rajasekhar Pooja Kaushik A Indira This paper, by analysing the performance of the commodity producing sectors of the Indian economy and the nature of the crisis facing it, argues that there is only a fiscal crisis of the government of India, and not a crisis of the nation. The authors then situate the recent economic policy changes in a broader context. They argue that the policies are contradictory in nature and are unlikely to result in the desired and anticipated changes in the economy. While the impact of these policies in the long run is not very clear, they are certain to adversely affect the poorer classes, both in rural and urban areas, in the short run. In an unequal society the question of who tightens the belt is crucial.

Institutional Credit and Overdues

Institutional Credit and Overdues D Rajasekhar G Suvarchala STUDENTS of political economy have been arguing that, in the rural areas, the financial system has been subordinated to the interests of the rural rich. Pointing to the growing political clout of the farmers' organisations, reflected in the prominence of political stalwarts like the late Charan Singh and Devi Lal, it has been argued that the rural bank- ing system has been (mis)used to provide subsidies and easy money for those who belong to this class. Overdues to the banks are only a symptom of this basic malaise. Be that as it may, we are grateful to A S Kahlon for initiating a debate on this important issue (Institutional Credit and Over- dues: Borrowers' Angle', EPW, February 2, 1991) within the narrower framework of the existing financial system. The main argument of the paper is that the loan policies and procedures of lending institutions have impaired the borrowers' ability to secure adequate incremental returns to enable them to repay their loans. Consequently, the over- dues have been mounting. The author, by using evaluation studies, District-Oriented Monitoring (DOM) studies and supply side studies conducted by NABARD in the early 1980s (which are not easily accessible to researchers), highlights the impact of factors like under-financing, tight repayment schedules, absence of initial grace period, short loan maturities and delays in sanctioning of loans, on overdues. While emphasising these points, the author has noted the hiatus between actual implementation and the set guidelines. For instance, as per the guidelines of NABARD, a banker must give 11-15 years' time to the borrower in order to enable him to repay instalments for schemes like dug-well with pumpset. However, in reality the borrowers are provided with only a 10-year term. Similarly, the author has noted the variation between the actual unit cost and amount disbursed in various categories of loans, once again arguing that the shortfalls have contributed to the default. Thus he concentrates on the causes of non- wilful default.

Rural Credit Delivery System-A Study in Pali District of Rajasthan

The 1980s witnessed some disturbing trends in the rural credit delivery system with an alarming increase in the overdues inform tending. This growth in overdues, which unless checked will lead to stagnation in the rural economy, has been attributed to various factors. The authors seek to examine some of these factors in the context of the rural credit delivery system in Pali district of Rajasthan.

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