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Cleaning India: The agenda named SWATCH BHARAT

, October 16, 2014, 0 Comments

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Ever wonder how government spend money? After all government, is no different than anyone of us. We all have fixed money income, and given this income we have to prioritize our spending. Government does the same. Allocating money for different sectors such as education, health, sanitation, defence, etc., is what is popularly known as budget.

But government has to tactfully spend this money – ideally in a way so that returns from each additional rupee spent on each one of these sectors give some benefit or return. Economists say money is spend unproductively when in spite of money being spend on some sectors, there are no returns. If that happens, then government runs into budget deficit, which is not good for any economy.

We use district-level income data to find out how each one of these aforementioned sectors is giving return, on money spent on them (For a more detail analysis see, Anurag Banerjee and Nilanjan Banik (2014), Is India Shining, Review of Development Economics, February issue). We find closed drainage system has the maximum impact on income through own and spillover effects.

Own effect reflects how the level of development (captured through development indicators) in any particular district (i) affects its own income. For 1% increase in closed drainage system, income increases between 0.96% and 2.58%. The second biggest factor is the availability of potable water. A 1% increase in availability of tap water systems within households gives rise to a 0.16-1.30% rise in income.

Many districts in India do not have a proper drainage system and lack potable water. Poor drainage systems usually have stagnated water thereby becoming a breeding place for mosquitoes. This could result in increase in malaria and water-related diseases in the vicinity, adversely affecting income. Similarly, proper potable drinking water systems have positive public health outcomes. If people are healthy, they can work harder and assimilate knowledge more efficiently, which translates into higher productivity and income growth.

In fact, studying income data tells us that income inequality has fallen across districts and there is an increase aspiration for living in a cleaner hygienic condition. Categorising India into high, medium and low-income regions we find that some districts of MP, Orissa and Rajasthan have moved from being low-income to middle-income categories. Some of the fastest growing states comprise erstwhile BIMARU states such as Bihar, MP and Jharkhand. Our paper also finds evidence about the neighbourhood spillover effect. We find when income in district (i) increase by 100%, income in the neighbouring district (j) increases by 10%.

Given these observations, the Swatch Bharat and Clean River Ganges programmes, launched by Prime Minister Mr Modi is certainly a welcome move. In hindsight, returns from sanitation and potable drinking water do give maximum benefit. Swatchh Bharat mission was launched on October 2, which aimed at creating a ‘Clean India’ in the next five years. The launch of the mission comes in the wake of a perception about Indian cities not being very clean.

A number of people in rural areas still do not have access to toilets. Some schools in the rural areas also do not have toilets. According to Census 2011, only 32.70 per cent of rural households had access to toilets. According to a UN report released this year, India continues to have the largest number of people in the world defecating in the open.

Similarly, for cleaning the holy Ganges, Mr Modi instituted a separate ministry. Union Finance Minister Arun Jaitley in his maiden budget announced an ambitious $33 million ‘Namami Ganga’ project – rejuvenate the polluted water of river Ganges within next three years. River Ganges basin constitutes 26 per cent of India’s land mass. Major cities in the basin — including Delhi, Agra, Meerut, Kanpur, Lucknow, Varanasi, Allahabad, Patna and Calcutta — generate and discharge huge quantities of wastewater into the river.

Both these programs, if implemented properly, will have an important implication from the perspective of having a cleaner environment, and eventually increasing national income. However, it is important to note, these programmes will not be successful without undertaking necessary structural reforms.

There is a need to change the law so that the people and firms responsible for littering/ polluting can be held accountable. There is also need for educating the common mass so that the cultural attitude changes towards having a cleaner environment. Government should also encourage more private sector participation for setting up waste water treatment plants. Only then Clean India campaign will become more meaningful and successful.