The government has reportedly announced that it has a 3 – pronged agenda: development, fast paced development, all round development. With the aim of promoting growth and development, the government has launched a slew of programmes: Jan Dhan Yojana, Digital India, Make in India, Skill India, MUDRA Bank Yojana, Swachh Bharat Abhiyan, Ayushman Bharat, and the list goes on and on.

Economist’s Perspective is that even the strongest proponents of markets believe that there are situations when market mechanism breaks down and therefore provide a rational for government intervention.

Addressing Market Failures:

• Strong push to infrastructure projects – not only to new projects is well meaning in so far as it addresses market failure in the provision of public goods .
• By being a founding member of the International Solar Alliance, the government has demonstrated a proactive role in the creation of global public goods too.
• Advancing the implementation of Bharat Stage emission norms from IV to VI with a view to curb the harmful effects of vehicular pollution or banning the sale and import of oxytocin to prevent its possible misuse, it is all about reducing the negative spill – overs.
• The government is also filling in for the ‘’ missing ‘’ markets, by rolling out programmes such as Jan Dhan Yojana aimed at financial inclusion, Housing for All programme aimed at subsidizing the cost of home loans for the lower – income class, Skill India Mission aimed at providing economic growth.
• Government has set for itself ambitious targets: doubling of farmers’ income by 2022, doubling of foreign tourist arrivals within next 3 years, generating 100 giga watts of electricity from solar by 2022
• The government is not only seeking to diversify sources of growth but also to democratize growth by unlocking the potential of people from all sections of society.

Addressing Challenges:

• In a market economy, one of the important functions of any government is to set standards and develop regulations so that markets can function well.
• Government has passed the Real Estate Act to bring greater transparency in the real estate transactions and to safeguard the interest of home buyers.
• Under its initiative – Minimum Government, Maximum Governance – the government in increasing the use of digital technology to substitute for human interface.

Promoting Equity:

• To promote equity the government has pursued several initiatives that are specific to certain geographies as well as to certain population groups. Ex: Special emphasis on the development of the North – East (NE) region.
• The government has identified over 100 “aspirational” districts that are lagging on certain key development indicators. Special emphasis to accelerate the pace of development in these districts.

Schemes that promote equity among specific Population sub – Groups:

• Ujjwala Yojana under which free LPG (clean cooking fuel) connection is provided to women form BPL families.
• National Health Protection Scheme seeks to insulate the poor and the vulnerable families from the hospitalization expenses during illness.
• To improve governance and minimize leakages in cash incentives, Direct Benefit Transfer scheme has been put in place.

A newer rational comes from behavioural economics that justifies the role of government in influencing peoples, behaviour and choices.