It would be sad if the potential of cash transfers was lost as a result of hasty posturing by those on various sides of the debate. The fact is that, in India today, poverty and economic insecurity remain endemic in spite of fantastic economic growth. The existing system has failed to arrest the growing number in poverty, despite substantial government spending ostensibly designed to reduce poverty. Could cash transfers help? A...

Conditional cash transfers” (CCTs) are a new buzzword in policy circles. The idea is simple: give poor people cash conditional on good behaviour such as sending children to school. This helps to score two goals in one shot: poor people get some income support, and at the same time, they take steps to lift themselves out of poverty. CCT enthusiasm, however, is often based on a superficial reading of the Latin...

Would you rather buy a necessity like kerosene or food grains at a subsidy or receive an equivalent amount of cash instead? Would you prefer that the government decides your consumption pattern rather than figuring out on your own how to spend your income? One of the “big ticket” reform items in the budget was the announcement that subsidies on kerosene, fertilizers and Liquefied Petroleum Gas and delivery through the Public...

Cash transfers cannot and should not replace the public provision of essential goods and services, but rather supplement them. Cash transfers are the latest fad of the international development industry, as the preferred strategy for poverty reduction. And now Indian policymakers are busy catching up. The idea was mooted in the Government's Economic Survey for 2010-11, and the Finance Minister made an explicit announcement in his budget speech for replacing some...

Cash transfers, the latest global development fashion, involve several risks in India, not least the risk of forgetting the need for continuing structural change. WHEN I was growing up, several decades ago, middle-class society in India was always a little delayed in catching on to Western fashions whether in music or dress or in other aspects. The past decades of globalisation seemed to have changed all that. Modern communications technology...