Don’t rely on subsidy raj: CM

New Delhi: Andhra Pradesh Chief Minister N Chandrababu Naidu on Friday urged economists, policy-makers and thought-leaders to ponder over ways to empower the poor and the downtrodden to the maximum through economic reforms rather than simply relying upon a subsidy raj that would do no good to the targeted sections due to loopholes in the implementation of schemes.

Addressing the Delhi Economics Conclave on JAM - Jan Dhan Yojana, Aadhaar and Mobile - vision at Vigyan Bhavan, Naidu said it was the duty of politicians to translate economic principles into reality by creating wealth and prosperity for society. Arguing that good economic practices make good politics, he said the trinity of Jan Dhan – Aadhar – Mobile (JAM) represented a good example of great marriage between economics and politics solemnised by technology.

Pointing out that AP had embraced the inclusive double-digit growth strategy through seven missions, five grids, five campaigns and forty growth engines, he said that he wanted to transform AP into a developed state with highest happiness index by 2029. Analyzing the reasons for the failure of some welfare and social security programmes, the Chief Minister said

of the Rs 51,000 crore subsidy given annually by the Indian Railways to the passengers, only 28 percent of the target group got the benefit.

Likewise, of the Rs 23,746 crore subsidy spent by the government on LPG cylinders, the poor households got only 25 percent of the total benefit. Similarly, a substantial part of the Rs 73,790 crore subsidies on certain fertilizer benefits the manufacturers and contributed to spoilage of soil.

Referring to the subsidy spent on rice, pulses, kerosene, and other essential commodities, he said the money only went into warehousing, logistics, and administration, apart from leakages throughout the supply chain. Again, important schemes like scholarships, social security pensions and many other schemes meant for the poor did not reach the most deserving.

While arguing that direct cash transfers would do more good to the beneficiaries, he hoped JAM held the greatest potential for structural transformation of the nation, second only to the economic liberalization that was launched 25 years ago.

He said JAM promised to be a game-changer as direct transfer of benefits, especially as cash rather than in kind, to the intended persons enabled a paradigm shift in the administration of welfare schemes.This was already put into practice in AP, he said.

A near universal Aadhar enrollment had been achieved in the State and at least one bank account to every family through Prime Minister’s Jan Dhan Yojana (PMJDY) had been provided, he said.

Deploying 784 mobile and stationary enrollment stations for providing UID to 4.90 crore people so far, the Government fecilitated opening of 69.70 lakh bank accounts in the State during the last one year and the account holders had been issued 63.2 lakh Rupay cards, he said.

Efforts were on in the State to bridge the gap in tele-density of the Rural and Urban areas to deliver 20 Mbps high speed internet to every household through fibre optic grid, he added.

Leveraging the potential of near universal Aadhar and Jan Dhan in the State, The government was able to transfer cash directly to the beneficiaries of 35 schemes in real time duly eliminating the intermediaries.

The effort was to give the choice to the beneficiary to draw the required amount directly from the Bank, ATM/ Micro-ATM, at the FP shop and in the near future through a mobile phone. Soon AP would be electronic cash transfer case thanks to the use of Aadhar enabled payment systems, he said.

The Centre should ensure the legal status to the JAM so that the people get benefited properly, he concluded.