A Note on the Inflationary Potential of Cash Transfers (NIAS Report No. R2-2011)

The government of India has initiated a series of moves to replace the current system of subsidies embodied in the price of essential commodities sold in the Public Distribution System with one of cash transfers to the poor. The Finance Minister announced the step in this direction in his budget Speech in February 2011 and pilot projects are being launched in selected districts. The case for this fundamental transformation is built around the widespread belief that corruption has eroded the Public Distribution System (PDS). It is argued that a major portion of current subsidies is wasted as the subsidized commodities don't reach the poor. it would then be more efficient if, instead of subsidizing the commodity, money was directly transferred to the bank accounts of the poor. The simplicity of this argument makes its conclusion appear obvious. But this very simplicity hides a number of assumptions. Once these assumptions are made explicit it is clear that they are not quite realistic. And when they are dropped, it is no longer certain that the cash transfers will be better than the present system. On the contrary, once the assumptions are dropped it becomes evident that such a change in the way subsidies are distributed brings with it major risks of inflation as well as a worsening in the already serious problem of malnutrition

Historical insights into modern corruption: Descriptive moralities and cooperative corruption in an Indian city

Much of the debate on the relationship between social norms and corruption has been confined to comparisons across countries. But a gap between what is morally acceptable by a society and what is legally correct can exist within individual countries as well. In such cases, it is possible for individual acts of corruption to be seen to be morally justified. This paper explores the emergence of this gap through the imposition of British law on a very different descriptive morality in nineteenth century Indian city of Bengaluru. Drawing from this experience it seeks to identify the dynamics of the process in a way that would allow for it to be used to understand corruption across different societies, and the lessons it has for an effective strategy against endemic corruption

In India, sport is divorced from play

In going well beyond the 100-member mark the Indian team to Rio has hopefully made a decisive break from the times when only a few Indian sportspersons qualified for the Olympics. This achievement can be made to look even more impressive by comparisons with carefully chosen countries

The permanence of temporary workers

The unique needs of those who work in cities even as they maintain homes in the village must be addressed by policymakers Cities bring with them a sense of permanence. Many of them have been around for hundreds of years. Some of their more memorable institutions too tend to have long histories. It is no surprise, then, that most of urban policy takes aspects of a city to be given. While migration into the city necessarily brings new elements into that urban space, it is typically assumed to be a unidirectional phenomenon with the migrants being expected, by and large, to become permanent residents of that city. Major Indian cities, though, don’t always fit neatly into this pattern. They often provide a critical place for workers who are not permanent residents of that city. This phenomenon is prompted primarily by the nature of Indian urbanisation. As usually happens with economic development, the share of agriculture in GDP income has been declining rapidly, with it hovering around the 15 per cent mark today. Economists would expect this decline to prompt largescale migration of labour into the city in search of work. This expectation underlies many of the projections of rapid urbanisation in India

Boys get to be born in better hospitals

As we marvel about what technology can do to ease the travails of life in our metropolises, it is easy to gloss over the misuse of technology, particularly in relation to women. It is widely recognised that advances in medical technology have led to sex determination of foetuses and sometimes female foeticide. As is now the normal Indian response, we have fallen back on laws to counter this evil. And it is becoming painfully clear that the laws don’t work well enough

The Great Indian GST Debate

The recent reduction in the rates of GST has seen the unusual phenomenon of both the ruling BJP and opposition Congress rushing to claim credit for the decision. Whatever may be the validity of these claims their competitive agreement suggests that the latest changes in the GST are without doubt a good thing. Nothing could be further from the truth. Instead, the cumulative effects of the rush into GST and the selective withdrawal are likely to leave a severe negative impact on an economy that is already seeing depressed growth rates

What the garment workers are saying

Trade unions are doing precious little for women in the workforce, especially young, migrant women The protests by thousands of employees of Bengaluru’s garment export industry last month had all the features usually associated with workers’ agitations, including violence and police firing. On the face of it this would appear to be no more than an unexpected return to the days before the decline of the trade union movement. But such a kneejerk reaction would ignore the more fundamental changes in the concerns of the workers and the nature of their protests. In the pre-liberalisation era workers would rally behind trade unions who would in turn be primarily concerned with issues in the workplace, particularly wages. In contrast, the workers in Benglauru came out on the streets spontaneously, and the issue that provoked them was quite substantially influenced by their lives outside the workplace