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Universal Basic Income Scheme

Mukesh Jindal
Written by Mukesh Jindal

The Economic Survey 2016-17 which was conducted in Parliament on 31st January 2017 by the Union Finance Minister Shri Arun Jaitley had Universal Basic Income (UBI) as an option to the various social welfare schemes in an effort to reduce poverty as the topic of discussion.

Even when the basic idea of the scheme is to reduce poverty like many other schemes being previously launched but the approach is a bit different and can be very powerful as per international standards.

According to the survey done by the Universal Basic Income scheme which is based on the philosophy of universality, and unconditionality, as well as the society, has been categorised as a conceptually appealing idea. But with a number of execution challenges lying ahead especially the risk that it would become an add-on to, rather than a replacement of the current anti-poverty and social programmes would make it monetarily unaffordable.

As per the official and report in Economic Times, the government is discussing the advantages and disadvantages of the scheme. Because of the huge size of the financial burden on government, such schemes may have implications in terms of deliverance and fiscal shortage. The government would take a final decision after point to point analysis of all the issues being raised in the discussion.



The main objective of the scheme is to provide a minimum income to the citizens of the country. Even when India does not have the prerequisites to provide UBI  to the entire population of the country which is below the poverty line, the topic is still potential for discussion.

The scheme cannot be implemented in the current scenario but these recent developments and initiatives by the government definitely indicate towards an advanced future witnessing major changes and that will be the right time to implement Universal Basic Income Scheme.

Exploring the principles and fundamentals for successful implementation of Universal Basic Income Scheme, the Survey points out that the two prerequisites for a successful UBI are:

  • A functional JAM (Jan Dhan, Aadhar and Mobile) system as it guarantees that the cash transfer goes directly into the account of a beneficiary and
  • Centre-State negotiations on cost sharing for the programme.

The Survey says that

  • 4-5 percent GDP- A UBI that reduces poverty to 0.5 percent
  • Three percent GDP – middle-class subsidies and food, petroleum and fertiliser subsidies currently existing.

UBI is considered as a powerful idea to be implemented even if the time is not right, the entire idea has been considered as a serious decision as concluded by discussion.


  • The government estimates to provide a grant of Rs. 1500 per month to about 200 million (20 Crore) households which are poor.
  • The scheme would mainly target groups of people who are unemployed with no source of income.
  • The vision of putting the money in the hand of women head of the household is also being considered so that the funds can be used in the better way.


  1. The policymakers have a vision that the SECC(2011) data and the Jan Dhan Accounts will be helpful in identifying groups who need the benefits of this scheme.
  2. Such universal basic income scheme can be helpful in addressing the poverty but if we look at other aspects it can also be immensely difficult and challenging to implement and target the right beneficiary.
  3. Such Universal Basic Income Schemes have been gaining foundations across the world.

This scheme is also being supported in countries like Finland where it has been  recently announced by the government to help people looking for employment


Universal Basic Income Scheme is an internationally accepted idea and this vision has now being considered in India under the Narendra   Modi government. The concept of the scheme is quiet good and aims to reduce the poverty levels but there are many disadvantages which basically indicate the risk of introducing a new scheme with a similar approach as many previous schemes. The idea has a great potential and is totally worth all the discussions even when its implementation is quiet far. It requires a detailed economic analysis and needs to keep in mind all the aspects. We hope that the scheme is being considered for further discussions and comes to implementation only after a  firm conclusion.


About the author

Mukesh Jindal

Mukesh Jindal

My name is Mukesh Jindal, and I am from New Delhi, India. I am an engineer by profession. I am employed by an IT company in which I work. My topics of interest include technology, mobile, and apps.

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