Reality Check India

New adhoc benefits to prevent big tickets from taking centrestage

Posted in Uncategorized by realitycheck on July 28, 2011

Full page ad is most newspapers today.

Government loans only for select people

In other words,

Student X (Open) from weak family who wants to study abroad a) cant get a loan even at 16% b) has no surety

Student Y(OBC) from family < 55,000 pm pa (6.6 Lakhs) gets a government loan at 4%.

UPDATE:

As pointed out by Sudhir Kudva, the ad indeed says total family income Rs 55,000 per annum not per month. I stand corrected.  This figure is barely above the poverty line  and one wonders about the ability of people to even take advantage of it.

COMMENT ON UPDATE:

If the cutoff is indeed 40,000 pa rural and 50,000 pa urban, one wonders about the very intention of announcing this scheme. Other than garnering publicity for the various ministers.  This excludes all but the most impoverished.  In the construction industry, a helper woman gets 250-300 per day.  They work 6 days a week. Over limit for the scholarship  for her child. This is not including husbands pay. In fact, if you use the NREGA rate (upto Rs 170 per day in some states) as a guideline – a single earning person will make 42-56,000 p.a depending on how many days they work.  This puts them way above the rural cutoff of 40,000 p.a.

This is even more disturbing because at this level of wretchedness there is no need to discriminate on the basis of caste.

Attaching groups of people to adhoc completely unmonitored benefits is the defining characteristic of Indian politics.  I do not recall there being a clamour for foreign educational loans for OBCs –  yet the government thought it was critical to keep the goodies coming.  This is because they know what keeps the status quo ticking and you dont.

Anyone who has been through the bank loan process for education knows how difficult it is.

  • The interest rate for open category is 16%
  • Need surety covering the entire amount
  • The paperwork will kill you
  • The pressure on banks to lend to priority people is immense

Those who think the classification of castes is about disgruntled IIT/IIM students think again. These benefits are what divides the people and the fact that they arent monitored at all keeps it that way.

The castes who read such full page initiatives by the government will not pay any heed to big ticket items such as corruption or terrorism or inflation at the polls.  It is human group dynamics at work. If they rebel against their benefit protector, they could be subjected to scrutiny and stand to lose out while others  in their exact same position who fell in line will take their share.

So its not about Yeddy or Raja – it is about removing the adhoc-ness. The social justice beneficiaries must be subject to scrutiny and a critical mass of free agents maintained in the system.

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3 Responses

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  1. Sudhir Kudva said, on July 29, 2011 at 12:32 am

    Rs. 55,000 is not pm but annual. So please correct this.

    Thanks
    Sudhir

  2. Seema Singh said, on August 3, 2011 at 6:50 pm

    This govt can do anyhting. Check out these shameful stats
    http://www.wahsarkar.com/2011/08/baap-beta-pvt-ltd-indias-political-dynasties/


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