Chief Economic Advisor (CEA) V Anantha Nageswaran on Friday dismissed the idea of universal basic income emphasizing that this kind of social security is not suitable for countries like India.
CEA further said this could create ground for perverse incentives and dissuade people from income generating opportunities. It may be noted that the idea of universal basic income was first propounded by former CEA Arvind Subramanian in the Economic Survey.
"India hasn't reached a stage where it is moral or an economic necessity to have a Universal social security," CEA said at a CII event.
Stressing that support should be targeted only at those who are unable to participate in any kind of economic activity, CEA said, "For a developed country which doesn’t have too many means of income opportunities, the state may have to step in and provide the universal basic income. For our country where natural growth should take care of many of the aspirations it may not be necessary."
Nageswaran also said the Indian economy is growing quite impressively after the pandemic in 2020-21 and expressed optimism about the economy in the next seven to ten years. He added that with the momentum in the economy, the final estimate of FY23 economic growth will be higher than the 7.2% GDP growth rate declared by the government for the fiscal.