Cash sops no magic bullet: Jairam

Subsidies delivered through cash transfers are no magic bullet to fight poverty. It’s only a better delivery mechanism — whether through cash transfers or Aadhar cards — that the government has adopted to make the welfare schemes more effective and to check misuse of funds. Now, states needed to build the education and health sectors and improve connectivity and create a network of institutions, such as panchayats and women’s self-help groups, union rural development minister Jairam Ramesh said at the 10th Hindustan Times Leadership Summit in New Delhi on Friday.

For this, he said the need for public-private partnerships (PPPs) in the social sector was crucial.

Faster economic growth has given rise to new kinds of poverty in India. Ecological degradation has led to the impoverishment of communities dependent on forests for their livelihood. More than 70% of healthcare costs in rural areas are out-of-pocket expenses.

While India has achieved much success in achieving the Millennium Development goals of reducing poverty and improving other social indicators, such as the infant mortality rate, a lot remains to be done.

According to the National Health Family Survey (2005-06), 40% of children under 3 years old are underweight and one in every three malnourished children in the world lives in India.

In this context, does the state have any role in reduction of poverty? “In my mind, that is an unquestionable yes," said Abhijit Banerjee, professor of economics at MIT.

So shouldn't the many centrally sponsored schemes be shut down in the interest of efficiency? Banerjee asked. “Well, schemes are hard to close down, because behind every scheme, there are schemers," said Ramesh, with the audience erupting into laughter.

India's public health system has collapsed: Jairam Ramesh | Politicians must give up their business interests: ex-Thai PM | Full coverage: HT Leadership Summit 2012 | Watch it live