Prime Minister Modi’s Ujjwala Yojana Has Helped Lower Rural Inflation: SBI Report

Pradhan Mantri Ujjwala Yojana has helped reduce inflation in rural areas, State Bank of India (SBI) has said in its latest Ecowrap report.

SBI’s report analysed the impact of PMUY on rural fuel and light consumer price index inflation in 10 states that accounted for 95.3 per cent of the total connections distributed under the scheme. According to the report, data shows that the states where more number of connections were distributed, the rural fuel and light inflation has significantly declined or stayed flat since the launch of the scheme.

According to the Economic Times, non-discretionary inflation in rural areas, which is essentially food, fuel and housing inflation, has almost halved to 3.05 per cent in October 2017 since the launch of PMUY in 2016. Non-discretionary inflation in rural areas was 6.44 per cent in May 2016.

“While the crash in food prices has been one of the reasons, we believe such decline is also fueled by the big impetus that has been given to PMUY that almost coincided with the beginning of such decline (launched in May 2016)” the Economic Times quoted State Bank of India chief economic advisor S K Ghosh as saying.

The report also notes that the prices of discretionary consumption in rural areas has been on a declining trend since 2016.

The scheme, launched by the Prime Minister, is aimed at empowering millions of poor women in our country who are forced to inhale unhealthy emissions from burning coal, wood and other unclean fuels while cooking.

Under this scheme, more than 3 crore Liquefied Petroleum Gas connections have been distributed across the country, the report noted.