Like Sri Lanka, many Indian states like Punjab, Rajasthan, West Bengal are also entangled in a huge debt trap. If there was no center support, then these states too would have become financially poor like Sri Lanka. Like the states, the central government is also getting entangled in the debt trap. To save the country from economic crisis, economic experts are advising to gradually reduce subsidies in items like agriculture and health and ban freebies schemes. But will it be the right decision to put a complete ban on the schemes being provided to the poor in a country like India?
Economic Affairs expert Dr. Nagendra Kumar Sharma told that taking loan is beneficial only when the loan amount is used to generate financial resources. But the report of the Reserve Bank of India shows that most of the states are spending a major part of their budget in clearing past liabilities and spending on welfare schemes. This gives them popularity, but it does not provide any income for the states. In this way, these loans are continuously becoming a burden for the states.
According to a report by the Reserve Bank, between 2014-15 and 2018-19, Punjab spent only close to five percent of its money on creating economic resources, while it spent about 45 percent on essential liabilities during the same period. Andhra Pradesh only 10 percent of its money on economic resource generating items, while it spent about 25 percent on essential liabilities during the same period. This method of spending cannot be called financially sound.
In the financial year 2020-21, the average debt of various states of the country has reached a high level of about one third of their GDP, or about 31.3 percent. The worst situation is of Punjab, whose debt has reached a record 53.3 percent of its GSDP (Grass State Domestic Product). In the second worst condition is Rajasthan, whose debt has gone up to 39.8 per cent of its GSDP. Similarly, West Bengal’s debt is 38.8 percent, Kerala’s 38.3 percent, Gujarat 23 percent, Maharashtra 20 percent and Andhra Pradesh’s debt has been 37.6 percent of its GSDP.
Duty of welfare state
At the same time, BJP national spokesperson and economic affairs expert Gopal Krishna Agarwal said that India is a welfare state. Its basic concept includes the welfare of the poor citizens. Therefore, the people who are deprived of bread, clothes and houses in the society, it is the responsibility of the central and state governments to help those people to get these facilities. However, in doing so it must be noted that the help should reach only the needy, helping the needy people only to get votes will increase the debt burden on the country. Trying to avoid this should be done.
According to the BJP spokesperson, it has come to the fore in an IMF report that if the Central Government of India had not provided financial assistance to the poor in the Corona era, through food schemes and other means, then this huge population would reach very low levels of poverty. Caste. By helping the poor people, they have been saved from going below the poverty line.
So do let us know what do you think about this ban on freebies in India to poor.