July 9, 2015

Role of Government in Social and Financial Inclusion

~ By Sanjay Paswan

The misplaced narrative being articulated by a section of the media and the intelligentsia on the effectiveness of the BJP led NDA Government in the Centre on the social sector front is indeed worrisome. By all means, the Government of India (GoI) is effectively exploring multiple facets of empowerment for the socially, politically and economically deprived sections of the society. This article makes certain observations about the steps taken by the present regime to achieve the pristine objective of social justice and holistic development of the last man in the village, which is reflective of the eternal commitment to the principles of Antyodaya.

Social Justice is a vital cornerstone of our constitution. Within the dichotomy of development and justice, one should not ignore the core responsibilities of the state. As far as development is solely concerned, non-state actors are sufficiently equipped with the resources and wherewithal to carry out developmental activities. Holistic inclusion can only be realized with the intervention of the state. It is here that there is an imperative need to revisit and rethink the role of the state. It is therefore opined that the State’s role is critical and should not be minimized. Disinvestment and abrupt privatization should be transparently debated and discussed as profit making and revenue generation leads to immense competition and ‘survival of the fittest’ syndrome. Socially, politically and economically deprived sections of the society may not be able to compete in the extremely demanding circumstances of the corporate world. Hence one of the paramount challenges is to create an amicable atmosphere to enable ease of doing business for these sections of the society.

The idea behind ‘Subaltern Entrepreneurship’ is to equip the subaltern skill base with the requisite support system comprising of financial and regulatory facilities. Through this article, the author recommends some ideas and suggestions to explore various avenues of empowerment beyond the conventional contours of the Constitution. One is aware of the fact that, government jobs are fast evaporating hence too much reliance on the government machinery might be a dangerous proposition. India has been traditional preservers of various skills such as shoe making, polishing etc. It is in the area of Skill development that one must evolve ways to match the existing skills sets amongst citizens with the ever increasing needs of the globalized world. It is also an appropriate time to think beyond redundant institutions such as National Scheduled Caste Finance Corporations etc. Policies facilitated by actions must ensure adequate representation of the weaker sections in co-operatives, corporates and civil societies through well-organized interfaces as well as through engagements at both institutional as well as at individual levels.

Financial inclusion or inclusive financing is the delivery of financial services at affordable costs to the economically weaker and the lower-income segments of society. True to this, GoI has taken several initiatives on the social sector front, all of which are potentially game-changers in the realm of social sector policy canvas. Right-based legislations initiated by the erstwhile regime have proved to be a nightmare both in vision and implementation. Hence, instead of lofty ideals, an actionable policy armed with inclusive growth is the need of the hour.

The key initiatives undertaken by the Union Government for social and economic security have been enumerated below:-

• Prime Minister Jan Dhan Yojana. This is a very significant scheme that strives to end Financial Untouchability by ensuring that the economically weaker sections have access to bank accounts.

• Expansion of Social Security Net. This has been achieved through Pradhan Mantri Suraksha Bima Yojana (Accident Insurance), Atal Pension Yojana (Unorganized Sector) and Pradhan Mantri Jeevan Jyoti Yojana (Life Insurance), which provide social and economic security to the marginalised sections of the society.

• Institutional Support for Subaltern Entrepreneurship. This has been achieved through MUDRA Bank, to provide microfinance to entrepreneurs in rural hinterland of India.

• ‘Venture Capital Fund for Scheduled Caste Entrepreneurs’. The objective of this Scheme is to promote entrepreneurship among the Scheduled Castes and to provide concessional finance to them. The scheme would be implemented by the Industrial Finance Corporation of India (IFCI) Limited for which Rs. 200 crores has been allotted.

• Credit Enhancement Guarantee Scheme for the Scheduled Castes: The objective of the Scheme is to promote entrepreneurship amongst the scheduled castes and to facilitate concessional finances to them. A budget of Rs. 200 crores has been allocated to IFCI Limited to facilitate the scheme.

• Swachhta Udyami Yojana: As an integral part of ‘Swachh Bharat Abhiyan’ launched by the Prime Minister on 2nd October, 2014, the National Safai Karamcharis Finance & Development Corporation(NSFDC) has launched a new Scheme ‘Swachhta Udyami Yojana’ on 2nd October, 2014 for financing viable community toilet projects and sanitation related vehicles to collect garbage.

• Green Business Scheme: The scheme has been Started by NSFDC, with the aim of promoting green businesses to support sustainable livelihoods of Scheduled Castes and Safai Karamcharis. Financial assistance would be provided for those economic activities that could address the challenges of climate change, e.g., E-rickshaw, solar pumps and other instruments working on solar energy etc.

• Sanitary Mart Scheme. Launched in 2014-15, under the scheme, loans are provided to up to Rs. 15 Lakhs to Safai Karamcharis for construction of toilets/bio-degradable toilets.

These schemes clearly highlight that the present government is committed to the cause of upliftment of Dalits and other disadvantaged sections of the population. As outlined, various landmark initiatives have been initiated under the present regime to eliminate poverty and empower the weaker sections of the society. In addition to this, there are several specific pointers which the GoI could keep in mind while formulating policies towards achieving holistic empowerment of the socially, politically and economically weaker sections of the society in the days to come. Some of them are:

• Democratizing Skill Development. Opening of Industrial Training Institutions (ITI) at block level. Presently, every district in the nation is mandated to have one ITI each for rudimentary skill development like plumbing, electricity, hardware etc.

• Credit Accessibility for ITI trained workforce for encouraging start-ups.

• Market Accessibility for the first generation of ITI trained entrepreneurs by ensuring backward and forward linkages.

• Bharatiya Dalit Bank on the lines of Bharatiya Mahila Bank can be created to ensure hassle-free access to financial services. Funds from Scheduled Caste Sub-Plan can be annually earmarked for the functioning of BDB.

• National University for Dalit Studies (N.U.D.S) – Centre of Excellence can be established for undertaking studies on different dimensions of empowerment.

• National Legislation to prevent the illegal diversion of funds from the Scheduled Caste Sub-Plan like the one in Andhra Pradesh.

Dr. Sanjay Paswan is a former Union Minister and member of BJP National Executive Council. The views expressed are his own


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