Balancing welfare and Delhi’s infrastructure
Delhi is one of few places where there is widespread unanimity for boosting infrastructure as well.
The BJP government in Delhi has finally announced the basic contours of its cash transfer programme for women that had bipartisan endorsement during the recently held elections. With an annual allocation of ₹5,100 crore and monthly payments of ₹2,500, the scheme would likely see 1.7 million beneficiaries. That’s almost 25% of Delhi’s women voters. It is far from universal but not politically insignificant.
What are the budgetary implications of rolling out this scheme? Delhi presented a budget of ₹76,000 crore last year with a capital spending of ₹15,000 crore. The new scheme is one-third of Delhi’s existing capital spending allocation. The political imperative of cash transfers and other populist handouts is widely accepted in the country today. Delhi is one of few places where there is widespread unanimity for boosting infrastructure as well. Ten years of AAP rule prioritised populist welfare over infrastructure and the city is almost coming apart. Unless things change drastically with a focus on overhauling old and building new physical infrastructure — the government alone will have to do it — things will get much worse.
Having announced the cash transfer scheme before its first budget — this is scheduled for later this month — the BJP government has secured its welfare flank. It remains to be seen what the Budget can do for other much needed and previously neglected avenues for spending. Will there be reductions in some of AAP’s existing schemes such as mohalla clinics? Will the Delhi government save money by adopting central welfare schemes that were not implemented for political reasons by the previous AAP government? Will these changes lead to a boost in capital spending? We will know the answers to these questions later this month.
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