Akshat Shrivastava, founder of Finfluencer and Wisdom Hatch, is sounding the alarm on India’s growing gifting culture, warning it could lead to fiscal disaster.
Shrivastava, in an article on ₹ 000,000,000,000 requires 40% of its revenue to provide the service, or almost $4 trillion. double the American burden.
Despite this stark disparity, he warns: “We continue to reward parasites with new projects every day. »
This warning comes at a time when political parties are doubling down on populist promises. In Delhi, Chief Minister Arvind Kejriwal’s Aam Aadmi Party (AAP) unveiled new schemes, including ₹18,000 monthly stipends for priests and ₹2,100 for women under the ‘Mukhyamantri Mahila Samman Yojana’ .
Free healthcare for senior citizens has also been promised under the ‘Sanjeevani Yojana’. The announcements drew criticism from the opposition, but are part of a long-standing trend of handout politics.
The phenomenon crosses partisan lines. Before the elections, the BJP and the Congress also resorted to populist measures. In Maharashtra, the BJP-led coalition has pledged to pay ₹1,500 monthly allowances to women, while the Congress has pledged to double the amount if elected.
Punjab’s promise to provide 300 units of free electricity has led to financial difficulties, with collection efficiency significantly reduced. Himachal Pradesh is struggling under the weight of reinstating the old pension scheme, borrowing heavily just to stay afloat.
Economists have long warned against such practices. NK Singh, chairman of the 15th Finance Commission, criticized the freebies as a “passport to fiscal disaster”, differentiating them from subsidies that generate long-term benefits, such as education and healthcare. Prime Minister Narendra Modi also called electoral giveaways a dangerous trend, urging voters to prioritize development initiatives over short-term aid.
The Reserve Bank of India echoed these concerns in its recent report on state finances, warning that rising subsidies are crowding out investment in critical sectors like infrastructure, health and education, areas that are essential to sustainable economic growth.
