Don’t make a Quixotic rush to cash transfer: Dreze

The noted economist points out why the food-transfer options would work better in India as opposed to cash transfers


Prasanna Mohanty | June 26, 2010

Jean Drèze is one of those development economists who have gone way beyond classrooms and seminars and helped shape policies. He has worked with Amartya Sen as well as served as a member of the previous National Advisory Council. Drèze shared his views on food security with Prasanna Mohanty.

Are you in favour of direct cash transfer to overcome problems in the PDS?
I don’t think that the system is ready for a transition from food-based transfers to cash transfers. The most needy people are also the most excluded from the financial system. Also, food is more likely to be well used than cash. Food grain is something everyone needs and the PDS infrastructure is largely in place – better improve it than make a Quixotic rush to cash transfers.

Will direct cash transfer in any way harm agriculture production, affect small and marginal farmers or hit our ability to intervene at the time of crisis?
There is no reason why cash transfers would be harmful in this respect, provided that buffer stocks and price stabilisation operations continue. But the fact is that these operations tend to be tied to the PDS, and to that extent, if the PDS were to be replaced with cash transfers, there could be adverse impacts on, say, the procurement system. But this is not the main issue – the main issue is the continuing relevance of the PDS.

What measures are needed to achieve food security?
Food security in the broad sense of nutrition security requires a wide range of interventions, concerned not only with food entitlements but also other requirements of good nutrition such as clean water, health care, effective breastfeeding and so on.

In a country where half of all children are undernourished, there is no quick fix. The proposed Food Security Bill cannot address all these issues, but at the very least, it should guarantee substantial food entitlements, going much beyond existing schemes and Supreme Court orders. The current draft is a non-starter in that respect.



Other News

Making sense of facts – and alternative facts

The Art of Conjuring Alternate Realities: How Information Warfare Shapes Your World By Shivam Shankar Singh and Anand Venkatanarayanan HarperCollins / 284 pages / Rs 599 Professor Noam Chomsky, linguist and public intellectual, has often spoken of &ls

The Manali Trance: Economics of Abandoning Caution in the Time of Coronavirus

The brutal second wave of the COVID-19 pandemic in India has left a significant death toll in its wake. Health experts advise that the imminent third wave can be delayed by following simple measures like wearing a mask and engaging in social distancing. However, near the end of the second wave, we witnesse

Govt considers fixing driving hrs of commercial vehicles

Union Minister of Road Transport and Highways Nitin Gadkari has emphasised deciding driving hours for truck drivers of commercial vehicles, similar to pilots, to reduce fatigue-induced road accidents. In a Na

Telecom department simplifies KYC processes for mobile users

In a step towards Telecom Reforms which aim to provide internet and tele connectivity for the marginalised section, the Department of Telecommunications, Ministry of Communica

Mumbai think tank calls for climate action

Raising concerns over rising seawater levels and climate change, Mumbai First, a 25-year-old public-private partnership policy think tank, has written letters to Maharashtra chief minister Uddhav Thackeray, minister for environment and climate change, tourism and protocol, Aditya Thackeray and Mumbai munic

Creation of ‘good bank’ as important as ‘bad bank’ for NPA management

After the recent announcement of the government guarantee for Security Receipts (SRs) to be issued by a public sector-owned National Asset Reconstruction Company Ltd (NARCL), there is a surge of interest around this desi version of a super bad bank. The entity will acquire around ₹2 trillion bad debts fr

Visionary Talk: Gurcharan Das, Author, Commentator & Public Intellectual on key governance issues


Current Issue


Facebook    Twitter    Google Plus    Linkedin    Subscribe Newsletter