Abhijit Banerjee was among the economists who helped the grand old party prepare — ahead of Lok Sabha polls — its minimum income plan called NYAY which later came to be its most significant proposition if it were to come to power.
The Congress has launched a scathing attack on Prime Minister Narendra Modi ever since Indian American economist Abhijit Banjeree won the prestigious Nobel award for his experimental approach to alleviating global poverty. Banerjee was among the economists who helped the grand old party prepare — ahead of Lok Sabha polls — its minimum income plan called NYAY which later came to be its most significant proposition if it were to come to power.
Catchy slogans and campaigns were designed around it, and the NYAY scheme formed the bedrock of all speeches by top leaders in the run-up to the Lok Sabha elections held in May this year. Although the outcome of the election was far from what Congress had anticipated, there was a view that the result would have been starkly different had the NYAY scheme been announced a little earlier in the campaign. Many pundits also blasted Congress for failing to take the message to the grassroots and blamed it for its failure.
The focus returned to NYAY hours after Abhijit Banerjee was named for Sveriges Riksbank Prize in Economic Sciences. Former Congress president Rahul Gandhi congratulated him for winning the Nobel in Economics. He, however, added that it was Abhijit who helped “conceptualise NYAY that had the power to destroy poverty and boost the Indian economy”.
“Instead, we now have Modinomics, that’s destroying the economy and boosting poverty,” Gandhi said. His sister and Congress General Secretary Priyanka Gandhi too emphasised how Banerjee had advised on the “NYAY Scheme of the Congress Manifesto”. She hoped that NYAY will one day become a reality.
While it is true that Banerjee had advised Congress on the scheme, but his recommendation was not what the grand old party promised in its manifesto ahead of Lok Sabha poll 2019. The economist had admitted in an interview that he had done the calculation and came out with a lower figure than what the Congress had promised. He said that the grand old party went with the bigger number, probably for political reasons.
“The details of the scheme, my view was that they should have gone slower. That it would have been easier to create the fiscal space if they went slower. I see the compulsion of going faster which is that you want to make a mark. An election is coming up. I think long term they are thinking election in some number of days,” Abhijit Banerjee had said in an interview to Business Today.
What Abhijit Banerjee advised
The economist had advised a more gradual rollout of the scheme. “The amount of money. Going with Rs 2,500 or Rs 3,000 (per month) would have been a good start. I was a bit more conscious of the fiscal constraints in saying that,” he said. Banerjee said that he did not recommend but did a calculation that — “if you do this, this is how much it would cost”. “I was doing the costing of it but they went with the bigger number,” he added.
What Congress promised in manifesto
The Congress in its manifesto promised guaranteed cash transfer of Rs 72,000 a year to each family, which is Rs 6,000 per month. The party in its manifesto wrote: “The Congress believes that the size of India’s GDP and the level of Total Expenditure (Central and State Governments) allow us to undertake an ambitious programme of cash transfer to the poorest sections of the people without in any way affecting the goal of fiscal prudence. The main features of the Minimum Income Support Programme (MISP) or Nyuntam Aay Yojana (NYAY) will be — A, the target population will be 5 crore families who constitute the poorest 20 per cent of all families. They will be the beneficiaries of MISP or NYAY. B, Each family will be guaranteed a cash transfer of Rs 72,000 a year.”