Indian Rupee

A Safety Net: Will India Copy Brazil?

by Elaine Schwartz    •    Jan 8, 2013    •    483 Views

If anyone asks you about India’s anti-poverty initiative, just say UID and CCT.

India’s current welfare-in-kind social support system is woefully inefficient. Sort of like a leaky pipeline, a part of the food, fuel, and fertilizer that the Indian government distributes to its poorest citizens never gets where it is going because of corruption and waste.

Through retinal scans and fingerprinting India’s unique identity project (UID) is supposed to cope with the problem by giving people a provable identity. Once you can prove who you are, the government, instead, can give you cash.

And that takes us to Brazil and its Bolsa Familia. A conditional cash transfer program (CCT), short term, Bolsa Familia is about alleviating the daily impact of poverty. Long term, it targets human capital and health. The cash transfer half is just that–a small regular electronic transfer. The conditional part is, you do not get your money unless your children go to school for a specified number of days. Absent 15% of the time and the cash stops.

With the goal of diminishing an inefficient, corrupt social support system, India is considering the Brazilian model. Brazil, though has a social safety net that has impacted 13 million poor families; in India, we might be talking about 440 million people. Below are graphs from The Economist displaying Brazil’s success.

Bolsa Familia Appears To Have Been More Successful in Rural Area

Bolsa Familia Appears To Have Been More Successful in Rural Areas.

Through Education, Bolsa Familia is Developing Human Capital

Through Education, Bolsa Familia is Developing Human Capital.

Sources and Resources: Here, The Economist describes the impact of Bolsa Familia in Brazil (also the source of my graphs) while this paper is good for a more academic perspective. I then went on to read more about India’s anti-poverty initiatives here in The Economist and here in the NY Times where they allude to Bolsa Familia as a model.

 

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