This article assesses a particular reform initiative that has great potential to emerge as global best practice in benefit transfers to poor households. On the contrary, this new approach faces several challenges. (200 Words) Business Standard Switching from 15kg cylinders to 5kg cylinders in rural areas will also help ease the cash-flow constraint for these households by reducing the outlay required for each refill. Reproduction without explicit permission is prohibited. It'll just take a moment. UPA-2 had introduced the DBT approach for some income transfers such as widows’ pensions and scholarships. In time, it could enable dismantling of the elaborate PDS, with consequent saving of huge costs. Is Globalization a threat to Indian Culture? In mature democracies such as India, it is normal that a new government that comes to power continues to implement promising schemes launched by its predecessor. It will have some problems with banks, post offices mainly with technical issues and online connectivity in remote places. Should anonymity be allowed on the internet? One key lesson is the importance of a consumer-friendly delivery system. Standard excuses are used such as spellings of names not matching, signatures not matching, address inaccuracy, etc., to avoid opening an account or making a payment. Direct Benefit Transfer (DBT) Scheme – Pros and Cons, Direct Benefit Transfer (DBT) Scheme’s aim is to transfer subsides, scholarships and other welfare benefits, directly to the bank accounts of beneficiaries. preferentially to a female head of household. It also experimented with a scheme to use DBT for LPG subsidies, which it later withdrew. Despite all this, LPG will remain an uncompetitive fuel alternative for about 50% of such households who continue to depend on firewood, cow-dung patties and other biomass that are essentially free. This is a sad commentary on the attitude of the rich, and implies that their exclusion from subsidy has to be enforced, not voluntary. This remains a major disincentive for adopting LPG as the cooking fuel of choice. Direct Benefit Transfer (DBT) Scheme. They selected streams affected by 68 mills for the study. Most of the banks appoints Business Correspondents to enroll beneficiaries in rural areas. Join Mint channel in your Telegram and stay updated with the latest business news. And there are many complaints that they are not giving passbooks to the beneficiaries making them unaware of the scheme. Unfortunately, the Jan Dhan Yojana programme notwithstanding, banking penetration among the target beneficiaries is still quite limited, especially in rural areas. An elaborate administrative apparatus has to be maintained at huge cost to manage the rationing of subsidized commodities. We use cookies to improve your experience on this blog. Hence, the system cannot work if the beneficiary does not have a bank account. DBT scheme allows time-bound transfers hence avoids delays in transferring money, which is one of the biggest problems beneficiaries are facing. Direct benefit transfer (DBT) is one such United Progressive Alliance (UPA)-2 initiative that has been vigorously pursued by NDA-2. However, DBT generates a new, and problematic, dependence on the banking system as discussed below. Our aim is to help students to give their best in Group Discussions. PAHAL is the first actual roll-out of a scheme using the DBT approach for providing subsidies. Thus, the main takeaway from PAHAL for the generic DBT approach is that it is potentially a much better alternative compared to the PDS. However, as the first pilot for this approach, the lessons learned from PAHAL have far-reaching implications for the whole approach of benefit transfers to poor households. Such a campaign is urgent not just for beneficiaries but even more so for front-line commercial bank staff. How prepared is India to tackle the COVID-19 outbreak? Direct Benefit Transfer (DBT) is Government’s major reform initiative to re-engineer the existing delivery processes, ensuring better and timely delivery of benefits using Information & Communication Technology (ICT). Yet, it accounts for only about 3.5% of the total annual flow of government subsidies. PAHAL is the first major programme in India that provides subsidies through DBT. With the aim of reforming Government delivery system by re-engineering the existing process in welfare schemes for simpler and faster flow of information/funds and to ensure accurate targeting of the beneficiaries, de-duplication and reduction of fraud Direct Benefit Transfer (DBT) was … The main takeaway is that PAHAL is potentially a much better alternative compared to PDS. Apart from these generic lessons in providing subsidies through DBT, there are also lessons from PAHAL specific for the delivery of LPG. Green Jobs are essential for sustainable development. This price gap distorts the market, providing opportunities for arbitrage, diversion of supplies and profiteering in the black market. The Public Distribution System (PDS) is India’s flagship food security programme but also suffers from well-known inefficiencies. And Union subsidies in turn account for only about a third of total subsidies provided by the Union and state governments taken together. Let’s see some of them: 1. They may open more than one account for each beneficiary for incentive. Thus, the adverse health and ecological consequences of traditional fuels notwithstanding, LPG penetration among this consumer group will remain a challenge. All Rights Reserved. Some of these are specific to LPG delivery and are discussed further below. Even official government estimates suggest that a large … An awareness campaign is also necessary about the subsidy scheme in place for low-income households, and how the DBT system works. With the National Democratic Alliance (NDA) government completing its second year in office later this month, there are numerous assessments of how the government has performed. With nearly 150 million registered beneficiaries, it is probably the world’s largest DBT programme ever. Under this scheme beneficiaries can open bank accounts with zero balance, which helps in financial inclusion. This will help Indian economy in the long run as the structural expenditure will be reduced. The CEEW study estimates that the richest 15% of the population account for about 25% of the LPG consumer base. In addition to integration of the Jan Dhan Yojana database with the Aadhaar database, DBT will require an aggressive awareness campaign. In rural areas, consumers have to fetch the LPG cylinders for long distances, often from delivery outlets located in other villages.

Eastern Meadowlark In Flight, Quinoa Recipes To Have With Salmon, Twirl Calories Multipack, Ice Cream Cookie Sandwich Near Me, Good Samaritan Law Karnataka, Cal Poly Scholarships, Mix Fruit Pudding Recipe,