“Universal basic income is a model to provide a standard livable income to all the citizens periodically.”(According to Basic Income Earth Network).UBI is a best example of Guaranteed Income.


UBI becomes an important idea to India as the present service provision schemes of government are way back in achieving its objectives. UBI helps in the following ways :

1)Its a best option to automation i.e, all the social service schemes meant for poverty alleviation can be automated through UBI.

2)Will compensate for reducing purchasing power and ensures economic liberty.

3)Will help in increasing equality among citizens.

4)Its direct cash transfer feature will increase demand for financial service and acts as unemployment insurance.

5)It somehow also increases productivity as small land holders will be encouraged to cultivate in their own fields rather than work as landless labourers.


Despite many advantages Economic survey of India (2016-17)said”UBI once implemented can’t be repealed in case of its failure .”Challenges faced by UBI:

1)Too expensive to implement and would create disincentive to work.

2)Only poor will receive the full benefit as others will taper off their net benefit through taxation.

3)As 1/3rd of adult population in India are unbanked and only 20ATMs per 1 lakh adults , UBI is challenged by lack of banking base.

4)Increases fiscal burden on government as UBI can be a add on to present welfare schemes rather than replacement.

5)Leads to Inflation as UBI is funded by higher taxes (especially indirect taxes).

*Government of India introduced Jhan Dhan -Aadhaar -Mobile scheme to develop banking Infrastructure and digitalize India.

However ,” UBI is important even if not ripe for implementation ripe for serious discussion “(acc to economic survey) in India because unlike developed countries like Canada,Switzerland etc…(who implemented UBI) India had very recently introduced the inclusive measures of Aadhaar , digital banking system etc .. which makes UBI implementation difficult in India.