Rahul Gandhi promises Rs 72000/year to 20% poor; BJP laughs it off

Making the announcement at a press conference here, Gandhi said five crore families and 250 million will directly benefit from the scheme

In a big bang election promise, Congress president Rahul Gandhi on Monday announced that 20 per cent families belonging to the poorest category will be given Rs 72,000 each annually as minimum income if his party comes to power.

Making the announcement at a press conference here, Gandhi said 50 million families and 250 million will directly benefit from the scheme.

"Final assault on poverty has begun. We will wipe out poverty from the country," he said Gandhi said the Congress has studied the fiscal implications of the scheme and consulted renowned economists and experts before finalising the scheme.

"It is an extremely powerful, ground-breaking and well-thought through idea. We have consulted many economists on the scheme," he said. "People have suffered in the last five years and we are going to give justice to them," he added.

A Congress official said any family earning less than Rs 12,000 a month would receive Rs 6,000 every month.

Ruling Bharatiya Janata Party (BJP) dismissed the plan as an enticement on which Congress cannot deliver. BJP's national general secretary Ram Madhav said, "If you are sure about your defeat, you can promise moon. Who takes it seriously? Already under different schemes poor families get much more support. Is it in addition to those schemes or they all will be subsumed in it?"

The number of Indians below the poverty line had fallen to about 65 million, or 5 percent of the population, from 22 percent in 2011, the BJP said on social network Twitter after Gandhi's news conference.

The BJP pledged direct cash support of Rs 6,000 a year for 120 million poor farmers and cut taxes for the middle class last month. It has also rolled out cheap health insurance for the poor.

One analyst said the scheme needed to be designed carefully.

"Large cash-transfer schemes have an important role to play in boosting incomes," said A. Prasanna, head of fixed income research at ICICI Securities in Mumbai.

"However, such schemes will be sustainable in the long run only if they are carefully designed and existing subsidies on food, fuel are subsumed into them."