The IHDS Forum is a monthly update of socio-economic developments in India by the IHDS research community, based on the India Human Development Survey, jointly conducted by NCAER and the University of Maryland. While two earlier rounds of the survey were completed in 2004-05 and 2011-12, respectively. Fieldwork for the third round was undertaken in 2022-24 and the data is currently being cleaned and processed.
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Policies have sought to promote participation in financial markets, but investor ignorance and negligence as well as fraudulent activities are impediments to growth.
India’s financial sector has grown exponentially over the past two decades. One major contributor to this is the rising participation of private investors in financial markets coupled with digitalisation. While the growth is commendable, it has brought new challenges that need to be addressed promptly. Policies and regulations have sought to promote increased participation in the sector, but instances of investor ignorance and negligence as well as fraudulent activities have acted as impediments to growth. Increasing complaints received by financial services institutions and regulators are evidence of the challenges posed by the adoption of fintech. The grievance redress mechanism often struggles to keep pace, leaving many consumers floundering in the wake of unresolved complaints and delays. A robust mechanism could potentially increase retail investment in the financial markets.
Financial regulators/institutions also face a challenge of disposal. Limited manpower and an increasing volume of complex cases impact consumer confidence and burden the institutions with increased operational costs and reputational risk. Systems like SCORES (SEBI Complaints Redress System) have pioneered online dispute resolution mechanisms, but consumer adoption remains low. A significant portion of the population either lacks access to necessary technology or the expertise to use digital tools. This not only elongates the resolution timeline but also discourages users from engaging with online platforms. The hesitation to file grievances also stems from a perceived complexity, fear of going unheard or getting lost in the procedural labyrinth. This phobia is worsened by the lack of user-friendly mechanisms that offer transparent and timely updates.
A major hurdle is the stark lack of financial literacy coupled with the gender gap in literacy. According to the OECD Report 2023, globally 35% men are financially literate compared to 30% of women. The financial literacy gender gap is even wider in developing economies. In India, 27% men are financially literate, but only 20% of women. This lack of financial literacy is not just about understanding basic financial principles but also extends to a lack of knowledge about the available system including for grievance redress. Thus, the solution lies not just in speedy and effective grievance redress but also digitalised financial literacy efforts as well as the adoption of a modern and preferably unified grievance redress agency. Creating a unified online portal for all financial services and grievance mechanisms could streamline processes, while artificial intelligence-powered chatbots can offer real-time assistance. Blockchain technology could enhance transparency in redress, and virtual financial assistants could provide personalised advice and support in managing finances and filing grievances. Setting up interactive digital kiosks in rural areas with limited internet connectivity will aid such innovations and significantly improve the efficiency and user-friendliness of India’s financial systems.
A multifaceted approach is necessary to ease grievance redress along with modernisation of financial systems. This should involve collaboration among various stakeholders, including regulators, financial and educational institutions, and consumer advocacy groups. Innovative ideas include developing mobile learning apps that employ gamification for engaging micro-learning modules and broadbasing financial education. Integrating the redress mechanism with digitalised financial literacy efforts is key. Additionally, community-based workshops, social media campaigns, and collaborations with registered advisors can help disseminate financial knowledge.
The Financial Sector Legislative Reforms Commission (FSLRC) has proposed setting up of a centralised unified grievance system for all financial services operating independently of regulators to handle retail consumer complaints through mediation and adjudication. Financial Redressal Agency, the proposed agency, would provide a single point of contact for consumers to lodge complaints, eliminating the need to approach multiple agencies. The time is ripe to revisit the FSLRC’s recommendations and implement a unified grievance redress system for the financial sector.
An efficient, technology-driven unified financial grievance redress system will not only resolve issues promptly but also strengthen public trust in the financial ecosystem, potentially leading to a surge in retail participation in India.
The author is IEPF Chair Professor at NCAER, Delhi. Views are personal.
The 2024 Lok Sabha elections present a mixed picture for female representation, with rising candidate numbers but a declining success rate.
The 2019 Lok Sabha elections marked a significant milestone in Indian politics, with the highest ever female representation in Parliament. With 78 women elected, female participation stood at an impressive 14%. This achievement was followed by the 2023 announcement of a 33% reservation for women in legislatures, although its implementation is pending.
The trend of increasing female candidates continued in the 2024 elections, with their number rising from 726 in 2019 to 797 in 2024, a 10% increase. This is notable as the number of male candidates witnessed a much smaller increase of only 3.3%. Despite the rise in female candidates, the number of women winning seats saw a slight decline, from 78 in 2019 to 74 in 2024. This decrease led to a reduction in their success rate from 11% in 2019 to 9% in 2024, signaling a setback in the upward trend of women winning seats.
At the party level, the BJP continued to field the largest number of women candidates and winners. However, their success rate mirrored the party’s overall reduced performance, with the number of female winners dropping from 41 in 2019 to 31 in 2024. In contrast, the Congress increased its tally of female winners from 6 in 2019 to 13 in 2024, despite fielding fewer women candidates (down from 54 in 2019 to 41 in 2024).
Smaller parties like Naam Tamilar Katchi, Lok Janshakti Party (LJP), Nationalist Congress Party (NCP), Jharkhand Mukti Morcha (JMM), and Biju Janata Dal (BJD) were able to increase the proportion of women candidates. However, national parties continue to trail the proposed figure of 33% for women’s reservation, indicating a lack of action on gender parity in political representation.
While the Southern states saw an increase in both the number of women candidates and winners, the northern and northeastern states experienced a decline in both categories. Interestingly, in central India – Madhya Pradesh and Chhattisgarh – despite a decrease in the number of women candidates, the share of women winners increased.
More alarming trends emerge in various states. In Uttar Pradesh, the number of female winners fell from 11 in 2019 to 7 in 2024. Additionally, states with relatively higher literacy and development levels exhibited disappointing figures in female representation. For instance, Kerala, which had one female winner in 2019, saw no female winners in 2024. Similarly, Tamil Nadu’s female representation remained stagnant and was comparable to Bihar, with states like Andhra Pradesh, Karnataka, and Telangana lagging further behind.
The state-wise trend among higher literacy states is particularly puzzling given that women candidates with higher education levels (Graduate and above) have notably higher win rates. Graduates and postgraduates together constituted about 56% of the candidates and accounted for 78% of the winners. This suggests that while educated women have a higher likelihood of winning, systemic issues in certain states may be hindering their higher participation and success.
Despite commitments from several parties to increase the proportion of seats given to women, a significant number of seats continue to have no female candidates. While the number of such seats has almost halved over the last 20 years (296 in 2004 to 154 in 2024), still 28% of seats offered no choice for the electorate to choose a female candidate.
The 2019 Lok Sabha elections were a shining moment for female representation in Indian politics, yet the 2024 elections present a mixed picture. While the number of female candidates continues to rise, their success rate has declined. The performance of national and state parties, as well as state-wise disparities, indicate that significant challenges remain in achieving gender parity. Women continue to face barriers to entry in the form of lack of financial resources, poll violence, and insufficient grooming by political parties, among other challenges.
It is crucial for political parties and policymakers to address these issues and work towards ensuring greater representation of women in Indian politics, leveraging the clear advantage that higher education offers to female candidates. Empowering women to take active roles in political processes not only strengthens democracy but also ensures that the diverse perspectives of all citizens are represented in decision-making.
Dr Jyoti Thakur is an Associate Fellow at National Council for Applied Economic Research, Delhi. Nikhil Kaushik is cofounder and CEO of Graviky Labs Inc, Boston, USA., Views are personal.
As a sweltering heatwave grips Northern India, Delhi has found itself at the epicenter of an alarming surge in temperatures. On May 29, newspaper headlines screamed of52.9 degree Celsius at Mungeshpur in north-west Delhi, raising concerns with climate change becoming the common refrain.
Though the India Meteorological Department (IMD) later attributed it to sensormal function at the automatic weather station, the fact that temperatures in the capital have been hovering around 50 degree C is enough of a warning.
The maximum temperature across Delhi NCR have varied from 45.2 degrees Celsius to49.9 degrees Celsius this season. Several factors have contributed to the high temperatures, including lack of rain and hot westerly winds from Rajasthan.
The factors
Temperatures in urban areas like Delhi can vary significantly due to both natural and anthropogenic factors. Areas with high concentrations of pavements, buildings, and roads experience higher temperatures because these surfaces provide less shade and moisture, leading to increased heat. Concrete, which can hold nearly 2,000 times as much heat as an equivalent volume of air, contributes to warmer temperatures.
Densely populated areas with narrow streets and tall buildings obstruct natural wind flows, preventing heat dissipation. Additionally, heavy use of air conditioners in shopping malls and residential areas results in localized higher temperatures due to the heat they release.
The warming over India is less pronounced than the global average. Annual mean temperatures in India have risen by about 0.7 degree Celsius compared to 1900 levels, significantly lower than the rise (1.59 degrees) for average land temperatures worldwide.
However, heatwaves in India have become more severe, with such conditions found even in February 2023, a winter month for which heatwave thresholds are not defined.
The human cost
The extreme temperatures have strained the city’s electricity grid and raised concerns about water rationing. Hospitals have reported an uptick in heatstroke cases, and the city has witnessed a rise in related fatalities.
Moreover, construction workers and other outdoor labourers face heightened risks, prompting the authorities to implement measures such as providing water at bus stands and considering paid leave during peak heat hours.
The extreme weather has an economic impact due to disruption of daily life and commerce.
Scientists and climate experts have long warned that such extreme weather events are likely to become more frequent and intense due to human-induced climate change. The past year has been the hottest ever recorded on the planet. This global trend under scores the urgency for comprehensive climate action and adaptation strategies.
Delhi’s recent experience serves as a stark reminder of the realities of climate change and the urgent need for robust infrastructure and emergency preparedness. The unprecedented temperature surge in Delhi is not just an isolated weather anomaly but a clarion call for climate resilience and action.
As we navigate this new climate reality, it is imperative to prioritize sustainable practices and policies that can help mitigate the effects of global warming and protect vulnerable communities.
The writer is Associate Fellow, NCAER. Views are personal
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