[India] in bold bid to beat poverty

from Business Day

HYDERABAD — India formally launched an ambitious bid to tackle village poverty yesterday by seeking to guarantee 100 days of paid work each year to rural families left behind by a city-based economic boom.

The scheme was launched in a remote village in Anantapur district in the south, where thousands of farmers have committed suicide, unable to bear the burden of huge debts.

“The Employment Guarantee Act will be a landmark in removing poverty from the face of our nation,” Prime Minister Manmohan Singh said at the launch.

It is part of the Congress Party-led government’s efforts to support the rural poor, who helped bring it to power. It offers one member of each household the chance to earn the legal minimum wage for 100 days’ work every year on projects to improve infrastructure.

Government estimates suggest the plan will cost nearly $9bn a year. Economists say it could widen the already large fiscal deficit, push up interest rates and hurt the bond market. India has set a deficit target of 4,3% of gross domestic product for the year to March, from 4,1% before.