New schemes

Miles to go

Print edition : June 12, 2015

Prime Minister Narendra Modi at Assi Ghat in Varanasi during a Swachh Bharat campaign on December 25, 2014. Photo: PTI

Drainage flowing into the Ganga at Rajendra Prasad ghat at Varanasi. Photo: Venkitesh Ramakrishnan

People queueing up to open bank accounts under the Jan-Dhan Yojana in Noida on August 29, 2014. Photo: PTI

Samar Ganguly, who works as a security guard, enjoys a newfound freedom because of the PMJDY. Photo: Suhrid Sankar Chattopadhyay

Ward councillor Zulekha Bi complains of indifference by bankers. Photo: Kunal Shankar

At a special camp to include Aadhaar number in the electoral identification card in Chennai on April 12. Photo: R. Ragu

Preparation of Aadhaar cards in progress at the Town Hall in Pudukkottai. Photo: M. Moorthy

Fatima Bibi, a migrant in Delhi, has found it impossible to get any ID card. Photo: Divya Trivedi

A PDS shopkeeper in Hyderabad using the fingerprint authentication device to issue foodgrains to an Aadhaar cardholder. Photo: P.V. Sivakumar

Activists staging a dharna in Vijayawada against the linking of the supply of subsidised LPG cylinders with Aadhaar cards. Photo: V. Raju

Narendra Modi and Finance Minister Arun Jaitley and Minister of State for Finance Jayant Sinha at the launch of MUDRA Bank in New Delhi on April 8. Photo: Ramesh Sharma

ASHA workers entrusted with implementing programmes like "Beti Bachao, Beti Padhao" in Matanhel village, Jhajjar district, Haryana. Photo: T.K. Rajalakshmi



SWACHH BHARAT



Just a photo-op

By Venkitesh Ramakrishnan in Varanasi



SANGAM DUBEY and Prakash Chandra Dubey have been eking out a living as pandas (small-time priests) for over two decades at Dashashwamedh Ghat in Varanasi. They conduct religious functions for people who come to immerse the ashes of their relatives in the Ganga or to perform rituals. By their own admission, their “expectations of a cleaner Ganga and better surroundings, leading to an improved life” for themselves rose to great heights when Narendra Modi became their MP and Prime Minister. The announcement of Swachh Bharat Abhiyaan, with the aim of creating a clean India, heightened these expectations since the programme was brought to Varanasi with an emphasis on cleaning up the ghats on the Ganga. “Open defecation around the ghats is only one of the several forms of pollution afflicting the Ganga. One of the stated objectives of Swachh Bharat Abhiyaan in Varanasi was to address this. With Modi’s reputation as a taskmaster, we had hoped the ghats would get cleaner and better soon. That would have motivated more people to conduct their ceremonies here. We would have had more people taking our services, increasing our dakshinas [fees given supposedly without asking]. However, after many months, we are still hoping, since nothing much has happened on the ground. But we are holding on to this hope because Modiji had said he is in Varanasi at the call of Ganga mata. We think that as Prime Minister he will live up to it in the days and months to come.”

While the two priests still hold on to their hopes, scores of others who make a living around the ghats and the Ganga have given up on Swachh Bharat Abhiyaan as well as on the other grand plans announced by Modi. So much so, most of them castigate the much-touted programme in the same manner people in many other parts of the country do: that it was merely a photo opportunity for an assortment of broom-wielding people, including Ministers and leaders of the Bharatiya Janata Party (BJP) and the National Democratic Alliance (NDA) as well as a clutch of celebrities pursuing different vocations. In Varanasi, this spectacle had a larger number of participants since it is the Prime Minister’s constituency. “There are special teams from Gujarat who have apparently come to oversee the programme and take it to places where it has not been implemented. But the so-called oversight and inspection has not brought any tangible results on the ground. Instead, one can see the Gujarat team as well as several local ones going to one area or the other with brooms, making a show of cleaning and getting their photographs clicked,” said Murli Pandey, who plies a three-wheeler.

An elderly shopkeeper selling mementoes around the ghats termed Swachh Bharat Abhiyaan a nautanki [north Indian opera characterised by hyperventilation and melodrama]. Refusing to divulge his name, he said that one just needed to take a walk around the ghats to know how big a deceit the programme was. His angry observations found reverberations across the ghats and in other parts of Varanasi, from people belonging to different sections of society. Even some local BJP leaders admitted, in private, that Swachh Bharat Abhiyaan had acquired farcical proportions in a large number of its daily manifestations.

Conceptually, according to the mission statement put out by the Ministry of Urban Development, Swachh Bharat Abhiyaan aims “to make the country clean by October 2, 2019”, and all the 4,041 statutory towns as per Census 2011 come under the project. The components of the programme include enhancing the number of household, community and public toilets, improving solid waste management, building up administrative capacity in fulfilling tasks in this sector and creating public awareness on sanitation and cleanliness. Every one of these aspects is relevant to Varanasi. Several BJP leaders, including Modi, had pointed out in interactions with stakeholders in Varanasi that putting an end to open defecation and improving sold waste management were central to cleaning the city and the Ganga.

Evidence of the abysmal failure of the promise to clean up Varanasi was abundant across the historic temple town. Walking around the main Dashashwamedh Ghat and Rajendra Prasad Ghat, one could see drainage water flowing into the Ganga through a number of outlets. Boatmen like Ramji Malha, who take pilgrims to the Ganga to take a holy dip, were seen advising people to move as far away Sas possible from these outlets. “These drainage outlets have existed for decades now and one of the things that the BJP promised when Modi filed his nomination from here was that such pollution of the Ganga would be stopped in a matter of months. One whole year has gone by and still nothing is being done about it,” a boatman told Frontline.

Long before Swachh Bharat Abhiyaan was launched, Professor Veer Bhadra Mishra of Banaras Hindu University’s (BHU) hydraulic engineering department had launched Swatcha Ganga Abhiyaan, identifying several factors that aggravated the pollution of the Ganga and making efforts to correct them through people’s involvement. Since he was also the mahant (head priest) of the famous Sankat Mochan temple at Tulsi Ghat, his efforts did evoke a popular response, but, ultimately, they got bogged down by the difficulties of carrying out specific tasks that could only be implemented by the government and its authorised agencies. Professor Veer Bhadra Mishra passed away in 2013 and his son, Professor Vishwambhar Nath Mishra, became president of Swatcha Ganga Abhiyaan and the mahant of the Sankat Mochan temple. Talking to Frontline, he pointed out that as many as 33 pollution sources had been identified by Swatcha Ganga Abhiyaan several years ago. “These included drainage outlets at the ghats that attract large pilgrim crowds, such as Rajendra Prasad Ghat and Manikarnika Ghat. But the outflow of filth from these outlets has not been addressed at all. Not even in a single one of them. An estimated 350 million litres of sewage a day is generated in Varanasi. Only 102 million litres a day can be treated by the existing infrastructure. Without enhancing this capacity, there is no point in imagining that we will succeed in lessening the pollution burden on the Ganga. Indeed, it sounds fantastic when one hears talk about Swachh Bharat Abhiyaan and cleaning the Ganga. We have been hearing that a leader wants to make Varanasi on a par with Kyoto and some other leader wants to make it on a par with Santiago. But what about making it a better Kashi? Why don’t any of these leaders talk about it?” he asks. His questions have considerable resonance across the temple town.

Even as these questions do the rounds in Varanasi, there is general consensus that some cleaning-up and improvement of infrastructure has happened at Assi Ghat, the place where Modi launched Swachh Bharat Abhiyaan, took up the broom and went through the motions of cleaning it in November 2014. New ghat steps have been built and several cultural and recreational programmes are hosted here. Another initiative, termed Jal Shav Vahini, consisting of a free motorboat service to assist funeral processions taking the dead to the Manikarnika and Harishchandra burning ghats, have also evoked appreciation. But these are perceived as exceptions to the general failure of Swachh Bharat Abhiyaan in the Prime Minister’s constituency. There is a special office that Modi has set up at Varanasi to address issues facing the constituency and its people. However, the person in charge of the office, Shiv Charan Pathak, could not provide details on the progress recorded in addressing issues, including on Swachh Bharat, when Frontline visited this office on May 18. According to Pathak, data were still being compiled and would be released soon.

Ashok Kapoor, president of Kala Prakash, a cultural organisation that strives to preserve and promote Varanasi’s social and cultural traditions, pointed out that the concept behind Swachh Bharat Abhiyaan was indeed relevant. But the common opinion in Varanasi is that Modi does not have the people to implement it on the ground. “There seems to be an admission of this in the very manner in which teams from Gujarat have been brought in to oversee the programme. But even this has not brought in any real positive change on the ground. Of course, there is an understanding among the people that being the Prime Minister, Modi will try and do something for the constituency, notwithstanding the failure of the Swachh Bharat Abhiyaan and Clean Ganga initiatives,” he said. Kapoor’s views reflect a realistic assessment as well as a guarded optimism, but even that cannot take away the larger question looming over Swachh Bharat Abhiyaan posed by many residents of Varanasi itself. “If this is the pathetic state of a much-touted programme in the Prime Minister’s constituency, how will it fare in other, less important towns and regions?”





PRADHAN MANTRI JAN-DHAN YOJANA



A numbers game

By Purnima S. Tripathi in Delhi, Anupama Katakam in Mumbai, Suhrid Sankar Chattopadhyay in Kolkata and Kunal Shankar in Hyderabad



On August 28, 2014, when the Pradhan Mantri Jan-Dhan Yojana (PMJDY) was launched by public sector banks with much fanfare, there was a celebratory atmosphere everywhere. Those who never had a bank account were excited that they could finally open one. Even those who already had accounts were excited because they thought opening an account under this scheme would entitle them to an instant deposit of Rs.1 lakh in their accounts. One such person, Radha, a housemaid living in Khoda village in Ghaziabad district of Uttar Pradesh, went running to her neighbourhood bank breathlessly the next day and stood in the queue for hours with her husband, an autorickshaw driver, to open an account under the scheme. “After all, it was a matter of Rs.1 lakh,” she told this correspondent.

She managed to open an account with an initial deposit of Rs.2,000 and then waited for her Rs.1 lakh to materialise. Obviously, it never did. It would only be deposited as insurance in case her husband, in whose name the account had been opened, met with an accident, rendering him permanently disabled, she was told by the bank officials after the initial frenzy of the scheme died down. “But nobody told us this at the time of opening the account,” she grumbled. Her husband’s account has been lying dormant since then; no transaction was carried out because the promised RuPay debit card never arrived and she had no clue about the Rs.5,000 that she could have taken as overdraft. “What can one do with Rs.5,000 in any case?” she said.

It was a similar story with others in the village who opened accounts under the PMJDY. “We thought we would each get Rs.1 lakh in our accounts once the black money which Modiji said he would get back from foreign countries arrived,” said Ramji, another resident of Khoda. Now, his account, too, lies dormant.

Good in intent, but lacking in results; too much sound and fury signifying little—this sums up the PMJDY, which the Prime Minister touted as the first step towards removing “financial untouchability” in the country. Such was the euphoria that accompanied the announcement that public sector banks bent over backwards to open accounts. Tents were pitched outside bank premises and all other banking operations came to a standstill in the initial days when Jan-Dhan accounts were being opened. The results were good: the target was exceeded. As against the targeted 7.5 crore accounts until January 2015, a total of 11.5 crore accounts were opened. This feat earned the scheme an entry in the Guinness Book of World Records for the opening of the highest number of bank accounts in the shortest period of time. A total of Rs.9,188 crore was deposited as a result. The main features of the account were: a zero balance account with an accident insurance of Rs.1 lakh, an additional life cover of Rs.30,000, and an overdraft facility of Rs.5,000.

But merely opening an account does not mean much unless it is linked to the government’s other welfare schemes and for that Aadhaar linkage is required. Now, with Aadhaar itself still a work in progress, the PMJDY means nothing. “It has merely been reduced to a numbers game, with banks competing with one another to exceed the target. In order to achieve the numbers, customers who already have accounts are being asked to open accounts under the Jan-Dhan scheme as well. There are many cases of people having multiple accounts. Since there was a time constraint, banks have not been able to strictly follow the KYC (Know Your Customer) norms either and this is bound to create problems for us in the future,” said D. Thomas Franco Rajendra Dev, a senior State Bank of India (SBI) officer who is the general secretary of the SBI Officers’ Association (Chennai circle) and vice-president of the All India State Bank Officers’ Federation.

If anything, this scheme has impacted the banks’ functioning negatively because no manpower planning was done to handle the additional workload. “In the last three years, the SBI’s staff strength went down by 3 per cent while business went up by 56 per cent. How do you expect the bank staff to cope with the additional workload?” he asked. Despite raising this issue many times in different banking forums, no attention was paid to this aspect, he said.

Rajkumar, a senior officer with the State Bank of Travancore, who is also senior vice-president of the All India Bank Officers’ Confederation (AIBOC), agreed. “There is an acute shortage of staff in public sector banks. At the time when the accounts were being opened, all our staff was busy with this scheme and other customers suffered. We did not have the staff to man our other counters. Right now, more than 50 per cent of the accounts are lying dormant, without any transaction. But once the government takes this scheme forward and other cash benefits get routed through the Jan-Dhan account, then we will need to have more staff. But no attention is being paid to this aspect,” he said. While it was a good thing that so many new customers have been added, how will the banks handle the pressure once transactions start happening in these accounts, he asked. Unfortunately, he said, the top management of the banks was reluctant to raise these issues with the government. “The matter was never discussed either with the Prime Minister or with the Finance Minister,” he said.

D.K. Tripathi, a senior officer with the State Bank of Patiala (SBOP), who is the president of the SBOP Officers Association, thinks the idea of financial inclusion is good but the methodology adopted is faulty. For example, he wonders why the regional rural banks are not involved in the exercise when the majority of customers targeted are from rural areas. Unfortunately, the spread of rural banks has been falling over the years. According to Reserve Bank of India data, the spread of rural banks fell by 7 per cent between 2006 and 2013. Moreover, according to Tripathi, public sector banks already have similar products, and if the government really wanted financial inclusion, it could have supported those existing schemes instead of launching new ones. For example, the banks already have insurance products at negligible premiums, which the government could have supported. Similarly, instead of the overdraft facility with the Jan-Dhan account, the government could have supported existing schemes of giving loans to the weaker sections under the Differential Rate of Interest (DRI) loan scheme, wherein banks give up to Rs.20,000 as loan at 4 per cent interest for some economic activities. If the government really wanted to benefit poor people, it could have supported this scheme instead of giving an overdraft facility because Rs.5,000 was too little for any productive economic activity, he said.

In fact, banking experts say that had the government included the banking industry in deciding the parameters and the methodology, the programme could have been much more effective, but the top bankers were not involved in any deliberations at any stage, either before announcing the scheme or after the scheme has been operational for 10 months.

Senior bankers agree that the scheme has only added to their woes. Public sector banks are already battling with non-performing assets (NPAs) and stressed loans, which are seriously compromising their profitability. According to the Fitch rating, stressed and soured loans are expected to reach the highest ever levels at 13 per cent, by 2016. Until December 2014, stressed and soured loans accounted for 10.73 per cent and this was mainly because the expected economic growth has not yet happened. The much-hyped “achche din” are still to come. According to Crisil ratings, soured loans in public sector banks have already reached Rs.5.3 trillion. This, coupled with acute staff shortage (bank recruitments have not been done for the last 10-11 years), and attrition (retirements, etc.), has seriously affected public sector banks’ functioning. The Jan-Dhan Yojana has only added insult to injury. That too, without doing any good for anyone, not even to the intended beneficiaries.

Misinformed in Maharashtra

Manisha Vinod Dubla from Ghachia village in Palghar district, Maharashtra, takes out a spanking new bank passbook from a plastic bag, which she keeps safely in a small cupboard in her hut. “I was among the first in my village to get a passbook under the new Jan-Dhan Yojana scheme. This was last September. We were told money would be put in our accounts. But nothing has come. I keep my passbook safely just in case the money does come.”

Thousands of women from villages in Palghar district rushed to open accounts under the PMJDY scheme when it was launched in August 2014. BJP workers had told them that accounts could be opened with zero balance and it would be in these accounts that all subsidies and allowances would be credited. Apparently, there had also been some loose talk about black money stashed abroad being brought back and given to these accounts. Women were also keen to open bank accounts as it would give them some level of financial independence, said Manisha Dubla.

Typical of government schemes, accurate information was lacking, and it was left to the people to decipher the scheme on their own. Frontline spoke to several account holders in the district and found that they had interpreted the PMJDY in various ways. While money had not been credited to the account (what they were given to understand), by and large, people felt that there was no harm in having an account. Women in particular felt slightly more empowered by having a bank account. However, in spite of the positives, there was a sense of having been misled and misinformed.

“During the elections, Modi had said that all the kala dhan [black money] that is stashed abroad would be brought back to India and we would be the beneficiaries. Some people said we would get Rs.15 lakh, others said Rs.50,000. We haven’t even got Rs.5,” said Manisha Dubla, who works as a domestic in the nearby town. Asked why she had not started savings by depositing some money, she said: “I earn Rs.300 per job [cleaning or sweeping]. I barely have enough to buy food for my two children. How will I deposit money?”

“In any case, this must still be seen as a positive thing. At least we have a bank account and we heard there is an overdraft facility and insurance,” said Kanku Prakash Govani, who works in the Municipal Corporation in Dahanu, Palghar district. “Besides, what if they do give us the kala dhan? At least we will have the right bank account.”

“Previously, it was such a problem to open an account. Now, with an Aadhaar card we could just walk in and they opened it for us. I don’t know what I am entitled to, but now I have an account, which I could not have got before,” said Lina Manat Dhode, from Dahanu.

The situation in Dahanu and nearby districts was indicative of what was happening across the State, said Mariam Dhawale, who works with the All India Democratic Women’s Association (AIDWA). Dhawale travels extensively in Maharashtra and says she has heard similar stories from other areas as well. “When you live in such unfortunate circumstances, these sort of schemes are a great draw. The BJP, however, needs to work on the fundamentals. Provide water, electricity, food security and employment. In the tribal belt, for instance, they don’t have any of the above,” she said.

Information from the PMJDY says that as on February 25, 2015, 93,97,375 accounts had been opened by 42 banks under the scheme in Maharashtra. Rural accounts totalled 44,70,852 while urban accounts came to 49,26,523. Statistics say 56.6 per cent of the total accounts are Aadhaar seeded. All India figures point out that until March 31, 2015, of the total 1,471 lakh PMJDY accounts opened, 58 per cent were still zero balance accounts.

“Ever since the PMJDY scheme was announced, we have opened many accounts for the urban poor. Each account is bundled with a free debit card, a Rs.5,000 overdraft facility, a Rs.30,000 accident insurance and a Rs.1 lakh insurance policy. It is a good scheme, therefore many people have been coming to open accounts,” said an assistant manager at the Central Bank of India in Mumbai’s Fort branch. He was unwilling to reveal how many accounts had been opened or whether BJP workers had assisted in opening accounts as was rumoured.

In theory, financial inclusion is a positive move. However, the bigger issue is to educate people on how to use the bank, says a banking source. The advantages are many: there will be more transparency and fewer leakages, leading to reduced corruption. For instance, people do not have to go via the sarpanch to get their money and so he/she will not have a hold on them. But it has to work.

Unfortunately, during the elections, the BJP misled people into believing that some “black money” would come back into the country and those who held these accounts would get this cash.

“Modi said achche din would come. We are only seeing bure din. Why isn’t the BJP talking about achche din any more? They are doing nothing about what they need to focus on,” said Barkiya Mangat, the State secretary of the Maharashtra Kisan Sabha and head of the Adivasi Adhikar Rashtriya Manch. Based in Talasari, which is largely a tribal belt in Thane, Mangat says primary health care, education, livelihood and food required aggressive addressing as the situation was very bad.

“For instance, rations are hardly available and when they are we get half of what we used to get,” he said. “Moreover, all this technology is not immediately helping our people. We have to travel half a day to reach the bank. Then we stand in long lines. If he [Modi] wants to help the poor, he should start by first addressing agricultural and land issues,” said Mangat.

Misutilisation in West Bengal

A mid-level employee working in the private sector in Kolkata approached a public sector bank to open a zero-balance account under the PMJDY scheme. On being told that the scheme was not targeted at people in his income group, he simply went to another bank, lied about his job, showed an identity proof and opened a zero-balance account.

Such cases abound in the success story of the PMJDY in the State of West Bengal, where 1,04,58,652 accounts have been opened (as of March 31, 2015). More than 89 lakh households that had no prior access to banks were covered and Rs.1,233 crore was deposited through 36 banks. “We are one of the major contributors in the country as far as deposits are concerned and account for 8 per cent of the national total,” said Manash Dhar, chairman of the State Level Bankers’ Committee (SLBC), which has been overseeing the project. Sixty-seven per cent of the accounts are from rural areas and 33 per cent from urban areas.

Although the scheme has undoubtedly come as a blessing for a large number of poor people who had no bank accounts, the lack of a proper checking system and political pressure to open accounts have prevented proper implementation and led to rampant misutilisation of the scheme. Moreover, simply opening an account is not likely to be enough, particularly in the rural areas where there has to be proper infrastructure and manpower to handle these accounts. “A large number of accounts were opened by the banks with the help of business correspondents of the banks working in the rural areas; but the problem is following up on that. Of late, we are simply overburdened with work as everything from insurance to gas booking is being done through banks,” a public sector bank executive in Howrah district told Frontline.

Although a huge number of accounts have been opened, there is a strong possibility that most of them are likely to remain dormant. Rajen Nagar, president of the All India Bank Employees Association, feels that the PMJDY scheme has been taken up in a “target and publicity-oriented” manner with little thought going into whether it will really be of any use to poor people. “Of what use is a bank account to a poor man who has no need for it? Is simply opening an account enough when a person has nothing to put in it?” said Nagar.

The scenario feared by Nagar is evident in many areas of the State. G.N. Chaudhury, of the Central Bank of India, who is in charge of the PMJDY scheme in Coochbehar district in north Bengal, admitted that 60 to 65 per cent of the accounts had been lying unutilised. “There is a lack of awareness among the public here and the people are just not interested,” he told Frontline. Nearly 70 per cent of the accounts opened in the district are from the rural poor, but there is hardly any banking activity from their end.

It is the same in south Bengal. According to a high-level source in the banking industry in North 24 Parganas district, more than 60 per cent of the accounts that were opened have remained at zero balance. “Our main problem is lack of manpower and infrastructure. We have opened accounts but are not able to provide the services. Sixty to 70 per cent of the RuPay cards, which the banks have to provide to every account holder, are still lying in the different branches of the banks in the district,” the source told Frontline.

In many cases among the rural poor, going to a bank is itself a forbidding prospect. Their accounts had been opened by business correspondents coming to their doorsteps and it is unlikely that many of them will take the initiative to take matters forward. “It is more likely that they will continue with the old practice of keeping the money with village moneylenders known to them. So, just having an account will not really be of much help to them,” said a district administration source.

However, there are also many among the poor who have benefited from their accounts. Geeta Gain, a domestic worker from Nadia district, said: “For so long I had to keep my money in an employer’s account, but not any more.” It is a newfound freedom which she does not even share with her husband. “I have not even told him,” she shyly told Frontline. Some of the urban poor too have benefited. Samar Ganguly, 51, a security guard in a bank ATM, never had a bank account prior to the PMJDY. “With my earnings (around Rs.7,000 a month) there was no savings; but now I am being able to put aside a little,” he said.

For people like Geeta and Samar, the benefits that the scheme offers, like accident insurance and life insurance covers, and the overdraft facility, are not of primary importance. But these benefits are what have drawn innumerable people like the middle-class private-sector employee mentioned above. In most of the cases, the common justification is that nowhere does it specify that only people below a particular income group are entitled to avail themselves of the scheme.

Rajen Nagar feels that unless a proper screening machinery is put in place, and as long as the banks remain overburdened with ever-increasing responsibilities and inadequate manpower, misutilisation of the PMJDY scheme will continue and those for whom the scheme was initially conceived will remain outside its purview.

Some bank employees themselves admitted that proper screening was seldom done in the rush to open accounts, and in many cases the target beneficiaries (the poor) have not been the real beneficiaries. Although it is still too early to comment how successful this new financial inclusion scheme has been socially, eventually, it will be judged by how the poor benefit from it. “Our apprehension is that the way in which the scheme is being implemented, ultimately the vast majority of the poor may in effect be left out. It may end up being a publicity exercise for the Centre, whereby they can claim that a large chunk of the population has been linked to banks,” said Rajen Nagar.

Multiple accounts in Andhra Pradesh

The PMJDY, meant as a tool for “financial inclusion”, could run the risk of becoming a scam if you go by what bank employees say.

None of the employees that Frontline spoke to wished to be quoted or have their bank names mentioned. A public sector bank employee in Medak district said that several applications they received between August 15, 2014, and January 26, 2015, were from people who had applied for similar accounts in several other banks.

The employee said: “We don’t yet have a universal database to check if an applicant already has a zero-balance account, unlike for gas subsidy where this is available.”

A branch manager of a private sector bank said the employees were under “tremendous pressure” during the first few days of the scheme as the Prime Minister’s Office had already decided on the number of accounts to be opened and “every bank was asked to come up with a target in order to match this goal”.

“Our target was 650 in two wards,” said the public sector bank employee.

While a major reason cited for the opening of multiple accounts is the overdraft facility, several beneficiaries Frontline spoke to seemed unaware of it. A public sector bank manager said: “Most people thought they would get some money by opening these accounts. RuPay ATM cards have been issued, but account holders have to have money to use them.” RuPay debit cards have been issued by the public sector National Payment Corporation of India, which has been roped in to provide a cheaper alternative to Visa and Mastercard.

Account holders complain of a lackadaisical attitude from bankers. Zulekha Bi, in her sixties, is a homemaker, a grandmother and a ward councillor. She is also a new zero-balance account holder. Zulekha said: “Seventy per cent of those who sought to open an account did not receive a proper response.” She said even those who had opened accounts “have not been provided all the facilities under the scheme”, such as an ATM card and a bank passbook. She holds a private bank account under the scheme and has the RuPay ATM card but not a passbook.

Waseem, a 25-year-old welder, opened a zero-balance account three months ago. He initially deposited Rs.1,000 and has used the account a couple of times since then. Waseem sees no benefit in the scheme as it stands today and he does not seem to be aware of the other benefits of the scheme such as insurance. The PMJDY website claims that over six lakh bank accounts have been opened in Telangana alone as of February 25, and that over five lakh account holders have been issued ATM cards. The total amount in these accounts has been pegged at close to Rs.300 crore. Bank employees point to the data and say they could probably be called the fruits of “financial inclusion”.





AADHAAR



Cloud of confusion

By Sagnik Dutta, Divya Trivedi in New Dehi and Lyla Bavadam in Mumbai



For 64-year-old Dasarathi, who lives in a ramshackle house in the Lal Gumbad slum in South Delhi, the old-age pension of Rs.1,000 given by the Delhi State government was the only ray of hope. Her husband earns a little money washing cars in the neighbourhood. Her tuberculosis treatment and her husband’s expensive cardiac treatment meant that they were hard-pressed for money. But, thanks to the Delhi government’s insistence on an Aadhaar card, she is unable to get the much-needed pension. Dasarathi had got herself an Aadhaar card in November 2011 with an incorrect date of birth. According to the Aadhaar card, she is not old enough to get the pension though she has other documents to prove her age.

There are several such instances in the slums of Delhi of people being deprived of social security benefits—old-age pension and ration—because they do not have Aadhaar cards. Most of the people living in these slums are migrant workers. This deprivation of benefits continues to happen despite the Supreme Court reiterating once again on March 16 this year that an Aadhaar card cannot be insisted on by government agencies for social welfare schemes. A bench of Justices J. Chelameswar, S.A. Bobde and C. Nagappan clarified that officials insisting on Aadhaar were violating the Supreme Court’s interim order dated September 23, 2013. Despite this, problems on the ground persist. In response to an RTI petition filed by Satark Nagrik Sangathan, a Delhi-based non-governmental organisation (NGO), the Delhi State government insisted on March 12 that as per the direction of the Government of India, financial assistance for any scheme had to be given under the Direct Benefits Transfer Scheme, for which the Aadhaar card was mandatory.

Further, the guidelines for identification of eligible households for receiving subsidised food grains under the “National Food Security Ordinance 2013” issued by the Delhi State government mandates that non-submission of a copy of the Aadhaar card may lead to the removal of a family from the list of priority category households. This continues to be a major problem for poor households who want to avail themselves of subsidised food grains but do not have an Aadhaar card.

Thirty-five-year-old Geeta had applied for an Aadhaar card in 2013 but she is yet to receive it. She was denied a ration card. Her husband, Ramesh, works in a local grocery store. The subsidised food grains would have been of immense help to the family.

Thirty-year-old Phool Devi encountered a similar problem. Her husband works as a daily-wage labourer and is the sole breadwinner of the family. She migrated to Delhi from Gangapur district in Rajasthan.

Twenty-four-year-old Babita and her two-year-old son were also denied a ration card because of their inability to produce an Aadhaar card.

Sixty-year-old Saraswati, a widow, sits outside her one-room house that is home to six persons of the family, which makes a living selling bhuttas (corn). She complains that the quality of the PDS (public distribution system) rice that she gets is so bad that it takes her three days to remove the stones from it. “They don’t give the proper quantity and now the quality is also bad. We don’t know what to do,” she told Frontline. Of the six people in her household, three were denied Aadhaar cards by the authorities concerned without citing any reasons. Although it is not mandatory to have an Aadhaar card to be eligible for ration under the PDS, their names have not been added to the ration card, and this cut by half the quantity of wheat and rice that they get.

According to the National Food Security Act (NFSA), 2013, household entitlements have been converted to individual entitlements and the quantity has been drastically reduced from 35 kg of rice and wheat per household every month to 5 kg of rice and wheat per person. So, when the names of individuals in the house get left out of the ration card, it results in a shortfall of the monthly ration for the entire family.

Twenty-six-year-old Maange Ram’s name is not on the ration card. In 2012, he had applied for an Aadhaar card but was denied one, and he was not told why. He has applied again this year, but Shabeena of Satark Nagrik Sangathan, which is helping people in the locality to streamline the PDS, said that chances were that his application might get rejected again. “We have seen that in cases where people apply twice, it gets rejected,” she said.

It is the same with Sunil Chouhan and Meena Devi’s family and several others in the slum.

In Jagdamba Camp Sheikh Sarai Phase-I, individuals who did not have an Aadhaar number found their names missing from the below poverty line (BPL) ration card, leading to reduced rations under the PDS for the entire family. This is a clear violation of the recent Supreme Court order clarifying that Aadhaar is not mandatory.

Yet to take off

On September 29, 2010, a tribal woman named Ranjana Sonawane was given India’s first Unique Identification (UID) number in Tembhli village in Maharashtra. She received it from Sonia Gandhi when the Aadhaar project was launched. Aadhaar was meant to ensure that inclusive growth was not just a meaningless mantra but a reality, especially for the underprivileged. It promised ease in opening bank accounts, procuring rations anywhere in the country, and straightforward access to government schemes. Five years later, the scheme chugs along. It is difficult to judge whether it has had its desired impact or not because the State is still in the process of signing on people for the card.

One of the selling points of the UID was direct cash transfer through banks and ATMs for certain groups, to ensure that cash subsidies reached them. It was meant primarily for the subsidy payment mechanism for LPG (liquefied petroleum gas) cylinders, kerosene and, in the case of farmers, fertilizers. While statistics available are more than a year old, what is clear is that it has got off to a slow start in Maharashtra largely because of the slow penetration of the Aadhaar card in non-urban areas. Until January 2015, close to 80 per cent Aadhaar penetration in the State helped in the seeding process in all the districts (seeding is the process by which the UID is added to the database of beneficiaries.)

While the process was particularly slow in rural areas, the scene in urban centres was quite different. Three years ago, on Day One of Aadhaar registrations at a south Mumbai municipal school, which had been requisitioned as an Aadhaar centre, the police had to be called in to control the crowds. There was a sense of panic in the crowd, not because of the police but because people felt that they may lose a chance to get an official identity card. This was, and continues to be, the prime motivator for acquiring an Aadhaar card. Rehana Sheikh, who works as a maid, said she heard the Aadhaar card was going to replace the ration card as proof of identity and she could not risk missing out because she believed it would help her when the slum where she lived went in for redevelopment.

Rehana’s Aadhaar card arrived within three months. Originally from Bijapur, on her next trip home, Rehana took the extra “precaution” of getting an Aadhaar card from her village as well. Her thinking was simple: “Who knows where we will live. We have family in both places and we have land in the village.” Her fear is compounded by the fact that the Shiv Sena may hound her out of Maharashtra because she is a Muslim.

Pascual P. works in Mumbai but says he will go back home to Goa after he retires. “I have one card for Mumbai and one for Goa. It makes life easy,” he says citing a gas connection he applied for and got on the basis of his Aadhaar. So far, he does not have a gas connection in Goa.

The government seems to be turning a blind eye to the fact that the U in UID is not all that sacrosanct. However, other departments are using the Aadhaar card to weed out bogus or double identities. In March this year, the State government announced a Rs.173.72 crore plan to clean up fake beneficiaries in the PDS. Under this plan, Aadhaar-linked ration cards will be issued and all PDS outlets across the State will be connected with a mobile terminal technology-enabled biometric network.

Another plan, announced in April 2015, moves to link Aadhaar cards with voter ID cards to get rid of bogus voters. Of the total of 8,35,34880 registered voters, so far a little over three lakh have registered to link their UID with their voter IDs.

As of now, Maharashtra is not as insistent on the Aadhaar card as other States when it comes to opening bank accounts, getting voter ID cards, securing gas connections or even getting marriages or property registered, though a ruling of the Bombay High Court has made it mandatory for all police stations to record the UID numbers of accused individuals and witnesses filing a first information report.

One hopefully positive programme has been the linking of the admission registration numbers of schoolchildren to the Aadhaar card to implement the Right to Education Act and track children in the education system. This is being started in rural areas and once completed, schoolchildren at the taluk and village levels will reportedly receive their Aadhaar cards.

Ever since the Supreme Court ruled against the Aadhaar card being made mandatory for all beneficiaries of government-sponsored welfare schemes, the Maharashtra State government has walked a cautious line. As of now, the UID remains a voluntary identification scheme in the State.





PUBLIC DISTRIBUTION SYSTEM



Jettisoning the PDS

By Divya Trivedi



Fatima Bibi’s house in Delhi may be less than 10 kilometres from the supreme legislative body of the country, but a ration card seems a distant possibility for this native of Malda in West Bengal. The 26-year-old has fallen through the cracks of all government schemes and does not have a ration card or an Aadhaar number. She has been a resident of Delhi for 16 years now but does not have any pehchaan patra (identity card) with her name and address.

“Whenever I go to Jal Vihar to apply for an identity card, the official asks me to get a copy of the electricity bill for residence proof. But our landlord does not give us the bill,” she told Frontline. In fact, most migrant labourers residing in the slums of Delhi have landlords who refuse to provide such proof. The slum where she resides with her husband and three children, sandwiched between one of the main railway stations (Hazrat Nizamuddin) and a major bus terminal (Sarai Kale Khan), has never seen a single State or Central government official visit it or inquire about the residents’ poverty status. Some students kept coming on research projects, she said. When asked where she got her ration from, she said: “When my husband can manage to get some food, we eat. Otherwise, we sleep hungry.”

Others in the basti, Anita Dash and Rama Dash from Motihari, Bihar, and Fatima from Khejuripur, Madhyamgram, West Bengal, complained that their rations had drastically reduced from what they used to get earlier. “We used to get 35 kilograms of rice and wheat, and also sugar, chana, dal and soap per household a month. But now we get only 5 kg of rice and wheat for two persons and the other items are not given anymore,” said Anita.

Under the NFSA, the per household entitlements have been converted to per person entitlements, hitting hard people in urban slums, where most families are nuclear.

Strangely enough, when the present ruling party was in the opposition, it was vociferous about strengthening the Food Security Bill. In 2013, immediately after the NFSA was passed by the United Progressive Alliance (UPA) government, Modi, who was then the Chief Minister of Gujarat, wrote a letter to Prime Minister Manmohan Singh criticising the reduction in foodgrain disbursals to 25 kg a household from 35 kg. He said, “This cannot be the objective of any food security legislation which reduces the entitlement of those who have been identified as being below the poverty line.” He also said that the proposed entitlement of 5 kg of foodgrain a month per person would not be sufficient to meet one’s daily calorific requirements and asked for an increase in the monthly quota of grain. The leader of the opposition at that time, Sushma Swaraj, called the ordinance half-baked, and when the Act was passed, Murli Manohar Joshi, another BJP veteran, moved an amendment for the inclusion of pulses and oil in the rations.

But all that seems to be forgotten by these people, who are at the helm of affairs now, and food security is not a priority for the Modi government. In fact, the NFSA under the new government has not taken off at all. When the UPA left office, 11 States had implemented the NFSA and that number has not gone up in the past one year. “Efforts at identifying beneficiaries have been fraught with several problems, including the insistence on Aadhaar and lack of transparency in the identification process,” said Amrita Johri of the Right to Food Campaign. According to the NFSA, the deadline for its implementation was July 2013, but already the Central government has extended the deadline thrice and the next deadline is in October this year. “These are being extended only through administrative means, which is a violation of the Act,” said Amrita.

Replacing PDS with cash transfers?

A lot of confusion has been created in the past one year, especially in the wake of the Shanta Kumar Committee report which recommended cash transfers in place of foodgrain supply and reduction of the coverage from 67 per cent of the people (75 per cent of the rural population and 50 per cent of the urban population) to 40 per cent. It also recommended the linking of Jan-Dhan accounts with Aadhaar numbers, transfer of money to the senior woman member of the household under Direct Benefit Transfer, and the linking of the amount to the inflation index. The report recommended that this cash-transfer scheme be implemented first in cities with a population of over one million, followed by States with a grain surplus and that the process be completed in two to three years. Niti Aayog chief Arvind Panagariya has also expressed support for replacing the PDS with cash transfers.

A Right to Information query filed by Anjali Bharadwaj, co-convenor of the National Campaign for People’s Right to Information (NCPRI), which is closely associated with the Right to Food Campaign, has revealed that the government may be well on its way to replacing the PDS with cash transfers. According to documents obtained by Anjali Bharadwaj, Amrita Johri and Dipa Sinha of the Campaign, the government has asked for the roll-out of a pilot scheme in one district in each State and Union Territory by July, and the first step to link the PDS with Aadhaar and bank account numbers is already under way. A software programme provided by the Centre to the States insists on linking the PDS to Aadhaar and bank accounts. Insisting on Aadhaar is a violation of a Supreme Court order.

Letters have gone from the Ministry of Consumer Affairs, Food and Public Distribution to all State governments and Union Territories regarding digitisation of all ration cards and the beneficiaries’ database along with seeding of available Aadhaar and bank account numbers. The National Informatics Centre has developed a Common Application Software (CAS), which has been offered to all the States and Union Territories for TPDS (Targeted Public Distribution System) computerisation. At present, CAS is used by 20 States. Although it has not been made compulsory, the letters say unequivocally that if States/Union Territories fail to comply with the timelines, the Central government may consider reducing the allocation under the TPDS. In a letter to the Chief Secretary of Uttar Pradesh, the Ministry of Finance has discussed a pilot scheme in all districts of Meerut division for transfer of cash to the accounts of beneficiaries. Frontline is in possession of these letters.

Pilot schemes were introduced in Puducherry and Chandigarh, but Puducherry has already gone back to the PDS. According to reports, people were happy with the way the PDS was functioning in the Union Territory and protested against cash transfers, and that led to the rollback. In 2011, in response to a letter written by 40 economists to Sonia Gandhi making a case for cash transfers, a group of researchers from universities across India surveyed 100 randomly selected villages across nine States and found, among other things, that respondents were worried that the money might be misused or frittered away. In a letter to the then Prime Mnister, the researchers/signatories, among them the noted economist Jean Dreze, said: “Where markets are distant, they (respondents) wondered where they would buy grain, and how they would cope if there is a sudden increase in local food prices. Even where markets are accessible, there were apprehensions, such as a fear that traders might raise prices if the PDS is closed. Similarly, the local bank was often said to be too far, overcrowded, or difficult to handle. Many respondents had a bitter experience of the banking system in the context of NREGA [National Rural Employment Guarantee Act] wage payments. In contrast, the familiarity and convenience of the local Fair Price Shop were widely valued. It is only in areas where the PDS was not working, notably Bihar and parts of Uttar Pradesh, that we found substantial interest in cash transfers as a possible alternative.” The turnaround that Bihar has achieved in making the PDS successful is another story.

The NFSA includes the PDS, the Integrated Child Development Services (ICDS) Scheme and the Midday Meal Scheme; all pregnant women in targeted populations are eligible for a maternity entitlement of Rs.6,000 each for the first two pregnancies. But nobody even talks of the maternity entitlement component, which is so important for child nutrition. If the government is gung-ho about cash transfers, why not expedite cash transfers to pregnant women first, asked the economist Reetika Khera, who teaches at the Indian Institute of Technology Delhi. “Only two States are providing this out of their own pockets: Tamil Nadu (Rs.12,000) and Odisha (Rs.5,000),” she told Frontline.

Ashti Merkha, originally from Simrega district in Jharkhand, is a widow who lives in Silokra village, South City 1 in Delhi, with her two children. The person manning the fair price shop told her that she was not eligible to get any ration on the card she had and she had to pay a bribe of Rs.800 to get a new one made. But ensuring two meals a day for her family leaves her with little time to run behind corrupt officials and pursue her case. Despite hers being a BPL family, she continues to buy rice at the market rate of Rs.32 a kg.





LPG SUBSIDY



The long wait

By Divya Trivedi and Anupama Katakam



In January this year, two days after Rama booked a refill for her LPG cylinder, she got an SMS stating that her booking had been cancelled, but no reasons were given. When her aged father visited the local HP gas agency outlet, he was told that they were required to submit their Aadhaar number to continue getting subsidised cylinders. Nobody in the family has an Aadhaar number, so they panicked. Only when her husband then visited the outlet and told the person behind the counter that they did not have an Aadhaar number was he informed that they could also submit their bank statement. Rama then went and submitted her bank statement. All this took several trips over 18 days during which time the household had to manage without cooking gas. When the cylinder finally arrived at her home in Khusro Nagar, she paid Rs.620 for it and was told that there would be a refund of Rs.200 in her bank account. She is still waiting for the rebate on the three cylinders they have bought since then.

Her young neighbour, schoolgoing Aayushi, rebukes her for not finding out properly beforehand what needed to be done. She told Frontline: “These people don’t know the rules. They just go and sit in the outlet for hours and no one tells them what the correct procedure is.”

Direct Benefit Transfer for LPG (DBTL) was introduced on the first day of this year across the country to streamline the subsidies, but it has ended up creating confusion. Under this scheme, customers can buy an LPG cylinder at market price and the difference between the subsidised price and the market price will be transferred to their bank accounts through direct transfer. The responsibility of linking Aadhaar numbers to the customers’ database lies with the distributors, while it is the banks that have to link the account numbers to Aadhaar to make the customer cash transfer compliant (CTC), after which the subsidy can be transferred. Although in theory it is not compulsory for customers to have an Aadhaar number to be eligible for DBTL, in practice the personnel manning gas agency outlets insist on it and only after much delay do they inform customers that bank account details will be accepted. Meanwhile, people who do not have bank accounts are now running from pillar to post to open one. For migrant workers, it is not an easy task to get somebody to refer their name, which most banks insist on for opening an account.

There are 311 distributors in Delhi with 46.71 lakh active customers, Pratap Doshi of the All India LPG Distributors Federation told Frontline. Of them, 72.5 per cent have become CTC—25.12 lakh customers are Aaadhaar CTC while 8.75 lakh are DTC, or direct transfer compliant, which means they have provided bank account details for a rebate. Vandana of Jagdamba Camp in Sheikh Sarai recently got her new BPL ration card and wanted to apply for a new LPG gas connection under the government scheme. But when she visited the local HP gas agency outlet, she was told that no one from Jagdamba Camp could avail themselves of an HP connection and she should apply for Indane. She tried to reason with the personnel there, saying that since her mother and her neighbours who lived in Jagdamba had HP connections there was no reason why her request should be refused, the person just brushed her off.

At 55, Hasina has been struggling to provide two meals a day for her family of eight, ever since her husband died a few months ago. They do not have an LPG connection and cook on the chulha, like most people of her basti in Sarai Kale Khan. She is not aware of the scheme launched by Union Petroleum Minister Dharmendra Pradhan in January for BPL families and others to provide subsidised 5 kg cylinders, the last date to apply for which was March 31. The scheme is a flagship programme of the Modi government for BPL families in urban areas and is part of the corporate social responsibility programme of the oil companies. Earlier, this scheme was available only to rural BPL families covered under the Rajiv Gandhi Gramin LPG Vitran Yojana. Under the scheme, a BPL family will get a subsidy of Rs.500 for a 5 kg cylinder that includes Rs.350 as security deposit and Rs.150 as cost of the pressure regulator, and Rs.1,600 subsidy for a 14.2 kg LPG cylinder, which includes Rs.1,450 as security deposit for the cylinder and Rs.150 as cost of regulator.

In the absence of any information on the matter, the scheme has passed many like Hasina by.

Widespread scepticism

In April this year, the well-known industrialists Anil Ambani, Mukesh Ambani, Anand Mahindra, Uday Kotak and Kishore Biyani announced that they were opting out of the subsidy scheme on LPG cylinders given by the government in a mark of solidarity with Modi’s call to give up this benefit. Modi has been appealing to the wealthier sections of society to stop taking the subsidy in order to help the poor. By making this announcement, the corporate honchos did get the otherwise-apathetic rich class and well-off middle class to sit up and work on cancelling their LPG subsidies. In fact, Anil Ambani went one step further and urged his employees to give up their claim to the subsidy. However, while the move seemed noble, it did also bring up a debate on whether citizens who fall within a certain income bracket should be entitled to LPG subsidies at all. Furthermore, will the savings really have any impact?

Frontline spoke to a cross section of people across income brackets and found that there was widespread scepticism among the middle class about whether the money saved would really reach the poor, or be diverted to useless government programmes. They demanded accountability and transparency. Among the urban poor, several say they can barely afford a gas cylinder, not to speak of trying to get a subsidy. Issues such as gas connection affordability and the lack of kerosene as an alternative also spun off the LPG debate. Both are obviously related and should be addressed. “When they announced the Give It Up campaign, I wanted to be a good citizen and opted out of the subsidy. However, what bothers me is whether this will really benefit the poor,” said Divya Dutta, who works with a pharmaceutical firm. “We are guilt-tripped into these things but there is no accountability from the government’s side.”

“Obviously, I would give it up. There is no doubt about it. I do feel, however, that as a taxpayer and a responsible citizen, we should be given a report card on this,” said Ajayesh Shah, a chartered accountant. “Besides, it is a personal decision. I don’t believe one should force your employees to do this. On the other hand, if the boss leads the way, perhaps it sets an example for others to follow. They should just give the subsidy according to income brackets. That would make a bigger impact,” said Shah. Maharashtra has close to 17.78 crore domestic LPG connections. This is about 715 connections for every 1,000 households, according to data available from the LPG dealers’ association. Usha Poonawalla, State president of the association, says approximately 5 per cent of the customer base has opted out of the subsidy, which is a substantial figure. This would come to about 35 people in every 1,000. “If even one person gives it up, it makes a difference. If you can afford to do it, I would say please do,” Usha Poonawalla told Frontline.

Usha Poonawalla said that a few months ago LPG dealers were told to step up the campaign. The process has gone very smoothly, with almost 85 per cent of Maharashtra’s customer base completing the formalities towards claiming the subsidies. Approximately 10 per cent are in the multiple connection zone and will use the parking period up to June 30 to take a decision. She said that they appealed to people’s conscience to make them understand the enormity of the problem. “I think they are on the right track. With the economic disparity going the way it is, it is time for the haves to give to the have-nots.”

In Mumbai, a 14.2 kg gas cylinder costs Rs.626 at market price. If a customer opts for the subsidy, approximately Rs.160 is credited to his/her bank account within a month. “Sometimes, it is very difficult for me to pay Rs.600 for the cylinder and then wait for the money to come back. Every rupee counts for us. Why can’t they charge us according to our BPL cards?” asked Mangala Kurudkar, a housewife whose husband is a cleaner at a school.

“I have been using kerosene obtained through the PDS ever since I got married. It is very difficult for me to raise Rs.7,000 to pay the deposit for a gas connection that comes along with a stove,” said Lakshmi Kadam, who works as a daily-wage earner at the fishing docks. “I wish they would give us the connection at a lower and subsidised price.” The cooking gas subsidy is one of the largest chunks of subsidies the government extends to citizens. The subsidy on LPG came to a staggering Rs.40,000 crore during 2013-14, according to information obtained from the Ministry of Petroleum and Natural Gas. “We have seen with this government the gap between promises and performances. Schemes for the poor and the disadvantaged have to address core issues and those issues cannot be looked at in isolation. The government has failed abysmally in controlling inflation. I don’t know how they will succeed with these schemes,” said Ashok Dhawale of the Communist Party of India (Marxist).





MUDRA BANK



Small and neglected

By Sagnik Dutta in Panipat and Vikhar Ahmed Sayeed in Bangalore



The dingy storeroom of a small textile-making unit, in a narrow bylane radiating out from Saloni Road in Panipat, wears a deserted look. There are piles of unsold goods lying around everywhere. Thirty-year-old Vikram Saluja, the young entrepreneur who owns the unit, tells us how sales have dropped significantly in the last one year. While the brouhaha over Modi’s “Make in India” campaign dominates newspaper headlines, this young entrepreneur’s plight brings out the ground realities of those who actually “make in India”.

The 2015 Union Budget laid special emphasis on reaching out to small and medium enterprises (SMEs) with the mega announcement of a Micro Units Development and Refinance Agency (MUDRA) Bank with a corpus of Rs.20,000 crore. In March, the Ministry of Finance announced that the bank would lay down guidelines for micro and small enterprise financing and for promoting right technology solutions. However, in Panipat, once a flourishing centre of the textile trade, no one seems to have heard of this scheme. No help has been forthcoming from the government during the years of decline in business. While the lack of government support has made it difficult for these units to survive, it has had a particularly harsh impact on labourers, mostly migrants from Uttar Pradesh, Bihar and West Bengal, who are often hired for extremely low wages and made to work for long hours.

Sunil Dutt, the Panipat district president of the Centre for Indian Trade Unions, said: “There are about 2.5 lakh labourers working in the textile industry in Panipat.” Saluja, owner of Vinny Loomtex which makes bedsheets and bed covers, said that the business saw a steep decline in the last one year. “The market is flooded with cheaper goods from China. Also, the electricity charges are very high in Haryana—about Rs.9 per unit at present—which further drives up the cost of production.” Saluja, too, has not heard about the MUDRA Bank. He lamented the lack of government subsidies for the struggling units.

Further, he complained about the high rate of interest for loans charged by banks. Saluja said: “Despite the significant drop in sales and profits, we continue to pay instalments on loans taken from banks at about 13 per cent interest.”

Diwan Chand, who owns Richa Fabrics, also complained about the high rate of interest and electricity costs and declining sales. He said: “I had taken a loan from Canara Bank about a year ago at an interest rate of 13 per cent. Sales have almost come down by half. We used to make about Rs.35 lakh a month a year ago; now we hardly make Rs.15 lakh. There are so many overheads for running the unit. About Rs.50,000 is spent in electricity bills alone. But we have to continue repaying the bank.”

The ripple effects of decline in the industry has hit 56-year-old Sukhbir Singh Malik too, who runs a textile machinery unit. He told us how schemes introduced by the UPA government for facilitation of new technology have remained on paper after the new government took over.

He said: “The Ministry of Small and Medium Enterprises had given us about 2,218 square metres of land in Sector 25 of Panipat to set up the Panipat Textile Machinery Cluster Development Centre in 2013. The Central government had promised the setting up of a common facilitation centre for 30 manufacturers who make machines for small textile units. The government had also pledged to help the manufacturers procure advanced technology. The National Democratic Alliance government has shown no interest in the project.”

The impact of the distressed units on labour is palpable. For 26-year-old Diwakar, who migrated from Sultanpur in Uttar Pradesh to work at a small-scale unit in Panipat, making a living on Rs.1,000 a week is proving very difficult. The work is mostly on a contractual basis and depends on the amount of work on offer at the units. “Work isn’t regular because of the downside in the industry,” said Diwakar, the lone breadwinner in a family of seven.

Thirty-five-year-old Murti, who assembles clothes in textile units, said that she barely made about Rs.100 a day after working for eight hours. Murti’s husband is unemployed and she is the lone source of support for her five children. Sunil Dutt said that the minimum wages had not been revised in Haryana since 2004.

Major issues

Meanwhile, in Karnataka, small enterprises continue to face a number of problems, including delayed payments by big entrepreneurs, the insistence of banks on collaterals for loans and the looming threat of foreign direct investment (FDI) in retail.

Speaking to Frontline, Chidananda Rajamane, president of the Karnataka Small Scale Industries Association, said: “Payment (receivables) is the biggest concern of the SME sector. Our major units are suffering because of the failure of bigger organisations, including government and non-government clients, to release payments for the goods we supply. Most of them, especially the government ones, are terrible with payment. All our industries suffer from lack of sufficient credit facilities. These are the major issues affecting the industry. It must be acknowledged that there are certain internal problems in the SME sector and added to these issues, credit-flow problems worsen the situation.”

He felt that the Modi government’s rhetoric had not translated into action. “MSME [Micro, small and medium enterprises] is the buzzword today. Our PM is talking about it. But in reality, nothing is happening. A lot more encouragement needs to be given to the MSME sector, especially in the payment segment. There is an Act for delayed payment [Delayed Payment Act, 1993], but it has got no teeth. As per the Act, payments need to be made within 45 days. Nobody pays us within this time period. We get the payments anywhere between 90 and 180 days. We can’t fight this also since units in the MSME sector depend on a couple of large clients. If we become aggressive in demanding payments, then our future orders will be affected.” He added: “There is a Central Government Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), whereby no collateral is required by banks for a loan up to Rs.1 crore. But no bank implements it.”

He further highlighted the risks posed by FDI in multi-brand retail: “A lot of MNCs [multinational corporations] come with their own ancillaries. The government offers them a fantastic platter with lots of subsidies—land free of cost, tax exemption, and so on. What will our local entrepreneurs get out of it?”

M.C. Dinesh, vice-president, Federation of Karnataka Chambers of Commerce and Industry, raised some doubts about the proposed MUDRA Bank: “The MUDRA Bank does not have a regulator. Who is going to regulate these accounts? There are lots of funding institutions like the Small Industries Development Bank of India (SIDBI), the National Bank for Agriculture and Rural Development (NABARD), etc. who finance micro, small and medium enterprises already. So what role will MUDRA have in financing the MSMEs?”





BETI BACHAO, BETI PADHAO



Half-hearted approach

By T.K. Rajalakshmi in Rohtak and Jhajjar



It was on January 22, on a cold rainy day in Panipat district, that Prime Minister Modi launched, with much fanfare, the Beti Bachao Beti Padhao (Save girl child, Educate girl child) programme with a Rs.100-crore corpus, aimed at arresting the skewed child sex ratio (CSR) across the country. And Haryana, with a CSR of 834 girls for every 1,000 boys (lower than the national average of 918 and the worst CSR in the country), was perhaps the most appropriate place to launch the scheme. He urged people to change their mindset. On the same occasion, and in the presence of the Minister of Women and Child Development Maneka Gandhi, he announced another scheme, the Sukanya Samriddhi Yojana, where savings deposits in the name of the girl child would be exempted from income tax. Maneka Gandhi, on her part, announced an award of Rs.1 crore to the village that attains a balanced sex ratio. It was another matter that a few months later, the budget of the Ministry of Women and Child Development was slashed drastically.

Jhajjar and Rohtak are among the hundred gender-critical districts identified in the country where both the adult and child sex ratios are skewed heavily. However, the actual responsibility of changing mindsets lay with the low-paid accredited social health activists (ASHAs) who are also meant to track pregnancies and ensure that pregnant women are monitored throughout until delivery and even for 42 days after delivery. Modi’s Panipat rally was filled with ASHA and ICDS workers and other health personnel of the government. Frontline met a few of them who were “taken” to Panipat. “We were there at Panipat. We all had to go. We had no choice. It was raining hard that day. We were not allowed to take anything inside that was black in colour. They took away our water bottles and food as well. There was arrangement for water inside the enclosure. But no food. The idea of Beti Padhao and Beti Bachao is good but where is the security for women and the schools for our girls? No girl or woman feels safe in Haryana,” one of them said.

Others recalled the statement made by the Chief Minister who, while campaigning during the Assembly elections, said that girls who wore jeans got raped. “Do 80-year-olds or two-year-olds get raped because they wear jeans? This was a very irresponsible statement,” said Moorti, an ICDS helper in her fifties. Savita, joint secretary of the Janwadi Mahila Samiti, told Frontline that the during the BJP’s election campaigns in Haryana, a Madhya Pradesh Minister, Kailash Vijayvargiya, had repeatedly made outrageous statements that women should not cross the lakshman rekha of morality. “These are the statements of our elected representatives. Even after girls are born, they are not safe. A one-and-a-half-year-old child was raped in Sonepat recently,” she said, adding that women regularly faced violence and harassment. Last July, two young girls committed suicide and left a note complaining of sustained harassment and eve-teasing. The two brave sisters of Sonepat who fought their molesters had to sit in protest in front of the Superintendent of Police’s office after obscene morphed pictures of the two were put up on social media, allegedly by the accused who were at large. “The structures are not there. There are no schools for girls beyond class five. If schools are there, there are no toilets. Girls have to travel long distances to study. There are no short-stay homes to rehabilitate women who have suffered violence. In Jind, a woman was murdered by her uncle because she made a claim to her property. Where is the protection? The contract of the protection officers appointed to deal with domestic violence was not renewed. They had to go on strike. This is the reality,” said Savita.

Pravesh is an ASHA worker in Matanhel village, Jhajjar. She said the programme launched may be good but the approach was half-hearted. “We are all betis too. Where is the protection, security or social security for us? We do not mind doing more work to better the sex ratio but does the government even think about the lives of the women who are employed to implement all their girl child schemes? The answer is no.”

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