- Crisil Ratings estimates that in FY25, pre-election spending for women in 18 states, including West Bengal, could reach ₹1 lakh crore
- Social sector initiatives targeting female voters in the run-up to elections are the main cause of this increase
- In FY26, states' social spending is predicted to stay high at 2% of GDP
18 states, including West Bengal, are anticipated to spend up to ₹1 lakh crore on pre-election welfare programs for women in FY25, according to Crisil Ratings. This increase in spending on the social sector, primarily through direct benefit transfers (DBT), may rise state spending to 2 percent of GDP in FY26, which might reduce available capital.
Historically, from FY19 to FY24, social sector spending varied from 1.4 percent to 1.6 percent of GSDP. More than 2.21 crore people have benefited from West Bengal's Lakshmir Bhandar program alone. The state's revenue deficit was revised up from the initial estimate of 1.76 percent to 2.38 percent of GSDP in FY25. The budgeted revenue deficit for FY26 is 1.74 percent, but further welfare expenditures could cause it to rise.
Crisil predicts that social welfare spending in FY25–26 will rise by ₹2.3 lakh crore over FY24 levels, with ₹1 lakh crore going to DBTs that are focused on women and ₹1.3 lakh crore going to programs targeted at the backward classes and other vulnerable groups.
The analysis includes states such as Gujarat, Karnataka, Uttar Pradesh, Tamil Nadu, and Maharashtra. Experts warn that if this pattern of widening revenue deficits continues, states may find it more challenging to fund large, long-term development projects.
