Understanding the World Bank’s USD 1 Billion Investment in India’s Covid-19 Social Protection Response Programme
In recent news, the World Bank approved a financial aid of USD 1 billion to speed up India’s Covid-19 Social Protection Response Programme. This has taken the commitment of the World Bank towards emergency Covid-19 response in India to a total of USD 2 billion. Prior to this, the World Bank had announced a support of USD 1 billion in April for India’s health sector.
Social Protection Response Programme
The main focus of the Social Protection Response Programme is on migrant workers, the unorganised and informal sector, and it aims to integrate the existing safety net infrastructure. These include the Public distribution system, the Jan Dhan scheme, Aadhar and mobile network. The aim is to provide vulnerable groups direct access to social benefits across the country, thereby expanding the coverage of India’s social protection system.
The Programme is also planning to introduce geographic portability, ensuring that the beneficiaries could access the social protection benefits from any part of the country. This will offer relief to inter-state migrant workers. Moreover, the Programme supports the efforts of the Government of India towards a more consolidated delivery platform, which would be accessible to rural and urban populations across state boundaries. It also aims to enhance India’s federalism by enabling states to respond quickly and effectively.
Phased Implementation
The implementation of this support will be carried out in two phases. In the first phase, an immediate allocation of $750 million will be provided for the fiscal year 2020. For the fiscal year 2021, a second tranche of $250 million will be made available.
The first phase will be implemented nationally through the Pradhan Mantri Garib Kalyan Yojana (PMGKY) to benefit the most vulnerable groups, particularly migrants and informal workers. The second phase will see expansion of the social protection package, providing additional cash and in-kind benefits based on local needs. This support will be provided via state governments and portable social protection delivery systems.
The Need for Social Protection Response Programme
With the unprecedented introduction of social distancing and lockdowns due to Covid-19, to slow down the spread of the virus, there has been significant impact on economies and jobs, especially in the informal sector. It is estimated that over 90% of India’s workforce is employed in the informal sector, with little or no access to savings or workplace-based social protection benefits such as paid sick leave or social insurance.
Further, over 9 million migrants who cross state borders annually for work are at a higher risk as most social assistance programmes in India provide benefits primarily to residents. As India urbanises, its cities and towns need targeted support, while existing social protection programmes focus more on rural populations.
In a scenario where nearly half of India’s population earns less than $3 a day, and hovers close to the poverty line, social protection becomes imperative. Thus the World Bank’s contribution aims to create a comprehensive social security net for all, especially the most vulnerable.
(Note: Information Source – PIB)