1.Fighting for public health (Live Mint)

2.India’s Banking revolution (Live Mint)

1.Fighting for public health (Live Mint)

Synoptic line: It throws light on the issue of securing public Health in public domain. (GS paper III)


  • The growing burden of non-communicable diseases calls for decentralized health policymaking and the use of nudges for disease prevention.

State of the health

  • The “India: Health Of The Nation’s States” report, released last week, makes two things abundantly clear. The first is that the lack of such a granular, state-wise assessment of India’s public health scenario and trends in a common framework until now has been an inexplicable failure on the part of previous governments.
  • The government has done well to rectify the lack. The second is that the nature of the country’s health challenges has changed sharply over the past couple of decades and is going to continue changing.
  • The latter should not come as a surprise. Global precedent shows that a country’s health profile changes as its economy and level of urbanization grow. The threat posed by communicable diseases such as tuberculosis and malaria, maternal, neonatal and nutritional diseases collectively termed infectious and associated diseases in the report declines, and the burden of non-communicable diseases (NCDs) grows.
  • India is no different, even if the rapidity and extent of the change are startling.

Burden of disease

  • In 1990, the total disease burden of infectious and associated diseases in the country, measured using the metric of disability-adjusted life years (DALYs), was 61%. The burden of NCDs at the time was 30%. Cut to 2016 and those numbers have just about flipped: infectious and associated diseases account for 33% of the disease burden while NCDs account for 55%.
  • This trend is going to continue to play out as India’s socio-economic contours change. In roughly the same period that the report covers the past quarter century two thirds of the deaths globally have been because of NCDs.
  • The World Health Organization predicts that over the next decade, NCD deaths will increase by 17% globally. And in high-income countries, generally speaking, they account for 80% or more of deaths.

What should be done?

  • The first is the need for decentralized health policymaking. There is wide divergence between the health profiles of various regions and states in India. While infectious and associated diseases now account for less than half of the disease burden in all the states, the transition happened as early as 1986 and as late as 2010 depending on the state in question.
  • Likewise, the NCDs burden covers a substantial range from 48% of the state disease burden to 75%. Drill deeper and it gets even more complicated. The burden due to specific diseases within the NCDs and the infectious and other diseases groups differs substantially.
  • This is true not just between groupings of economically similar states say, industrialized states like Maharashtra and Gujarat, and Empowered Action Group states like Uttar Pradesh and Madhya Pradesh but between similar states as well.
  • This divergence, naturally, extends to the risk factors that cause various diseases. In the face of this reality, Centre-dominated health policymaking save in its broadest contours such as increasing insurance coverage, setting standards for public sector health institutions and deciding drug policy must inevitably diminish the effectiveness of state response.
  • The second takeaway is the nature of state response will have to enter relatively new territory. According to the report, the leading individual cause of death in India in 2016 was ischaemic heart disease. The other NCDs in the top 10 individual causes of death included chronic obstructive pulmonary disease, stroke, diabetes, and chronic kidney disease. Risk factors such as dietary risks, high blood pressure, high blood sugar and tobacco use rank correspondingly high.

Way ahead

  • Building an effective choice architecture can require direct government action. Urban planning is perhaps the best example of this. Ensuring that citizens lead a more physically active life would directly address a number of risk factors for NCDs.
  • That means ensuring ease of access from everything to pedestrian access to public transport and communal green spaces. Effective architecture will require bringing private enterprises on board in other instances from displaying health information and advice in stores to appropriate food labelling, high salt warnings and product placement in stores.
  • This sort of broad and diffuse response will not be easy to implement. And certainly, addressing the weak fundamentals of India’s health system is critical. But NCDs are called lifestyle diseases for a reason.
  • Evidence from developed economies shows that addressing them requires inducing basic changes in the manner citizens live their lives, effective health systems notwithstanding. Achieving this without straying into state paternalism and heavy-handed regulation an ever present risk in India is going to be tricky but essential for fighting tomorrow’s health battle.

Question– How Government can take steps to make public health more responsive and precise?

2.India’s Banking revolution (Live Mint)

Synoptic line: It throws light on how due to lowering of bank transaction costs, hundreds of millions of people who lacked access to financial services are revealing a latent demand. (GS paper III)


  • Financial inclusion providing universal access to financial services and encouraging their use is an important means for promoting economic development.
  • As of 2014, the World Bank estimated that there were still two billion adults without a bank account, and many others with only a tenuous connection to the financial system.

Benefits of banking

  • Better access boosts the efficiency of the payments system, promotes household savings and access to credit, and improves people’s ability to manage risk. And, as it does all of these things, financial inclusion will likely reduce inequality and increase economic growth. In other words, reducing the multitudes of those that are unbanked will improve the fate of the poorest of the poor.
  • India’s unprecedented effort to “bank the unbanked” through the Pradhan Mantri Jan Dhan Yojana (PMJDY), is by far the largest such undertaking in the world. Launched in 2014, the mission to provide no-frills, no-minimum-balance (hereafter, JDY) bank accounts to every adult including the one-fifth of the population living below the poverty line as well as those living far from a bank branch has been remarkably successful.

Status of Banking

  • As recently as 2011, only 35% of Indian adults had a bank account. As of this writing, 306 million JDY accounts have been opened, roughly 60% in rural and semi-rural areas (see graphic). And, while initial readings suggested limited use, over time, JDY account holders appear to be learning about the benefits, so that use is rising toward levels observed for bank accounts of comparable individuals. Moreover, the average deposit now appears substantial relative to poverty-level income.
  • Put differently, by lowering bank transactions costs, hundreds of millions of people who lacked access to financial services are revealing a latent demand.
  • Many previous efforts to reduce the ranks of the unbanked have been far less effective. Consequently, a great deal of work is needed to determine which characteristics of the Indian programme have been key to its success.

Deliverables by Jan Dhan

  • However, recent research, benefiting in part from using actual JDY account data, documents the following encouraging facts:
  • JDY accounts show increasing activity with account age, suggesting that holders are learning with experience.
  • JDY accounts both that receive government transfers and those that do not build balances over time that are economically meaningful for poor households.
  • Districts with a larger unbanked share prior to the JDY programme display both greater account creation and a greater amount deposited, as well as a larger increase in the number and amount of loans granted.
  • JDY narrowed the gender gap, with women more likely to obtain accounts.
  • JDY narrowed the urban-rural gap, with people dwelling in rural areas more likely to obtain accounts.
  • JDY improved account access for people below the poverty line.

Way ahead

  • Collectively, these results point to sizeable gains for India’s poor. To be sure, the programme’s overall impact on aggregate welfare is difficult to assess. A key reason is that the costs of establishing and maintaining JDY accounts are not yet observable. But these costs can be balanced against what could very well be large benefits for the society as a whole. Among other things, shifting from cash to electronic transfers reduces the opportunity for both cash-based black-market activity, and for “leakage” the tendency for only a part of a government benefit payment to find its way to the intended recipient.
  • It is of key importance for policymakers both inside and outside of India to understand the sources of the JDY programme’s success. The extraordinary features of this effort including not only no-frills accounts, but also the extensive involvement of national leadership, the provision of unique biometric IDs, and the advent of digitized government transfer payments would seem difficult to simulate in a small randomized control trial. And it is relatively easy to see how a programme of this size and scope with associated network effects and large economies of scale and scope might succeed where experimental trials fail.
  • Consequently, while it is a sample of one, the Indian experiment deserves far more study and attention from researchers, policy think tanks and international organizations.

Question– What is the status of banking in India? What should be the govt.’s approach to further penetrate banking