## Sunday, February 12, 2017

### Universal basic income in India: An idea whose time has not come

by Ajay Shah.

#### Cash transfers to poor people

For many years, economists have advocated cash transfers to poor people as the best tool for poverty elimination. This avoids the inefficiency of in-kind transfers such as those undertaken by the Indian Public Distribution System' which is beset by operational difficulties, and transfers to the non-poor.

The basic arithmetic works out as follows:

If we deliver \$0.5/day to the bottom 20% of society, this is an expenditure of \$48 billion/year at the current Indian population of 1.3 billion. This is 2.4% of GDP/year.