Issues and Challenges in Conceptualisation and Implementation of Nyuntam Aay Yojana

A few years back, the concept of universal basic income (UBI) was proposed in quasi form, as a political manifesto, by introducing the Nyuntam Aay Yojana (NYAY). This proposition has a picayune hope of striking right against the poverty trap in India. The scheme proffered to benefit the poorest 20% of the population (those living below the poverty line [BPL]), by providing a guaranteed cash transfer of `72,000 annually through the direct benefit transfer (DBT) mechanism, into the bank account of any female member of the household. It was proposed to be rolled out in a phased manner, after the pilot and testing stages. Also, it is estimated to cost approximately 1% of gross domestic product (GDP) in the first year and 1%–2% in the next year (Chidambaram 2019), after which it is expected to decline with reductions in poverty. NYAY is proposed to be implemented as a joint scheme of the union and state governments.

Poverty eradication programmes have been operational in India since independence. Although there are concerns regarding methodology, basket of goods and services used, reference period, the Government of India continued to estimate poverty using consumption expenditure data and used it for various welfare schemes. The official estimates of poverty suggest that there has been a secular decline in it over time; the percentage of population living BPL has declined from 45.3% in 1993–94 to 21.9% by 2011–12 (Planning Commission 2011–12). However, the concept and measurement of poverty has evolved over the years and goes beyond money-metric dimension to include multiple aspects of health, education and standard of living.