Development policies are being selected on analysis, not whims of politicians

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Some state governments in India are testing a new way of setting development priorities. Policy proposals are being selected on the basis of cost-benefit analyses, not the whims of politicians.

Citing the example of Panipat, The Economist report said, that last year auditors from the central government found that it had dedicated 60% of its budget from Beti Bachao, a national scheme meant to correct gender imbalances by fostering and educating girls, to erecting a “themed gate” at the entrance to the town that proclaims Panipat’s bold commitment to this worthy goal.

Moreover, since the national government took office in 2014 it has by official count, spent some $ 643 million (twice what the previous one did) on publicising its own programmes and achievements in TV spots, billboards and full-page newspaper ads that typically feature the smiling image of the prime minister, Narendra Modi.

In other respects, however, Modi’s government has worked hard to put public money to better use, the report said. A decade ago a government survey calculated that only 16% of funding for a national food-distribution programme actually reached the intended beneficiaries. Modi’s strong personal backing for social programmes has ensured impressive progress for many, such as a national campaign to eradicate “open defecation”.

Two state governments – Andhra Pradesh and Rajasthan – are considering policy models involving experts and based on cost benefit analysis. The model, funded by Tata Trusts, was developed by a Danish economist, Bjorn Lomborg, and tested in countries such as Haiti and Bangladesh. Over the past year Lomborg’s team has consulted hundreds of experts and interested groups, picked some 79 policies for consideration and commissioned dozens of economists to analyse them. If the pilot schemes work well, Tata Trusts would like to extend the process across the country, says the report.

Some potential returns are astonishing. Citing a paper that was presented by Nimalan Arinaminpathy, an epidemiologist at Imperial College, London, clever interventions to combat tuberculosis (TB), a disease that kills 30,000 people a year in Rajasthan alone, could bring a return of up to Rs 179 for every rupee of government spending. This is not because India makes no efforts to deal with TB. The trouble is that the government’s hitherto highly successful anti-tuberculosis campaign, the world’s largest such effort, is struggling to reach the country’s poorest and most vulnerable.

The rate of new infections could be cut drastically by enlisting private village doctors and chemists, using better diagnostics and seeking out cases in places where they are likely to occur rather than waiting for them to be reported.

The report says that the biggest savings would come from a steep drop in future costs for treating patients with multi-drug-resistant forms of the disease, a group that makes up only 4% of TB patients but accounts for 40% of the government’s bill. Arinaminpathy’s numbers are not fantasy; they are backed by robust statistics and match similar findings in Bangladesh. The government has, in fact, already begun to push its TB programme in the direction he has suggested.

(Based on a report by The Economist)

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