If competitive populism has its way, the country will pay for 2019 elections for years to come. Congress President Rahul Gandhi on January 28 promised to give a minimum income to the poor if his party is voted back to power. For now, talking heads of the Congress party have avoided attaching any number to the idea.
Meanwhile, it has been reported that the government is also working on measures to improve income in rural areas. While one will have to wait for the government's plan, the idea mooted by the Congress party has plenty that will make financial markets nervous.
First, it is not clear as to how much money will be paid, and to what percentage of the population. Remember, elections are the driving force behind the idea, not the poor. Therefore, any political party would want to appeal to the largest possible section of the society. Anyway, India does not have a very good record of targeting. The National Food Security Act (2013), for example, covered nearly 70 percent of the population.