Rs 62,000 Crore Freebies: Congress win might cost Karnataka this much every year

Rs 62,000 Crore Freebies: Congress win might cost Karnataka this much every year

Muskan
June 11, 2023 8 minute read
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Why is Congress spending 62000cr on Karnataka?


The Congress party has recently won the Karnataka assembly elections with a thumping majority, defeating the Bharatiya Janata Party (BJP) and the Janata Dal (Secular) (JD(S)). The victory was largely attributed to the slew of freebies and welfare schemes that the party promised in its manifesto, called 'Sarva Janangada Shanthiya Thota' (Peaceful garden of all communities).

The manifesto gave five guarantees to the people of Karnataka: Gruha Jyothi, Gruha Lakshmi, Anna Bhagya, Yuva Nidhi and Shakti. These guarantees include:

- Providing 200 units of free electricity to every household per month under Gruha Jyothi scheme.
- Giving Rs 2,000 per month to every woman head of the family under Gruha Lakshmi scheme.
- Distributing 10 kg of rice per person per month under Anna Bhagya scheme.
- Paying Rs 3,000 per month to unemployed graduates and Rs 1,500 per month to unemployed diploma holders under Yuva Nidhi scheme.
- Offering free bus passes to all women for travelling in regular KSRTC/BMTC buses under Shakti scheme.

Apart from these guarantees, the manifesto also promised to repeal all 'unjust laws and anti-people' laws passed by the previous BJP government, such as the anti-cow slaughter law, the anti-conversion law and the anti-love jihad law. It also vowed to take 'decisive action' against individuals and organisations spreading hatred on the grounds of caste and religion, such as Bajrang Dal and Popular Front of India (PFI).

The Congress party claimed that these promises would not entail much cost to the state exchequer, as they would not exceed 15% of the state budget. It also said that the size of the budget would increase over the next five years due to the robust revenue growth that Karnataka has registered.

However, some calculations suggest that the cash payments and power subsidy alone would cost Rs 62,000 crore a year, which is nearly 20% of the state budget. The amount that could be spent on major freebies is as large as the fiscal deficit in the previous financial year, which was Rs 60,581 crore. This large outgo will certainly make a dent in the state budget and affect its fiscal health.

The question that arises is whether these freebies are sustainable and justified in the long run. While they may provide some relief and support to the poor and needy sections of society, they may also create a culture of dependency and entitlement among them. They may also discourage work ethic and productivity among the beneficiaries. Moreover, they may divert scarce resources from other important sectors such as health, education, infrastructure and environment.

Therefore, it is important for the Congress government to balance its populist measures with prudent fiscal management and efficient governance. It should also ensure that these schemes are implemented transparently and accountably, without any leakage or corruption. It should also monitor their impact and outcomes regularly and make necessary adjustments if required.

The Congress party has made a big promise to the people of Karnataka by spending 62000cr on various welfare schemes. It remains to be seen how it will deliver on its promise and whether it will benefit or harm the state in the long run.


What are the alternatives to freebies?

While the Congress party has won the hearts and votes of the people of Karnataka by offering generous freebies and welfare schemes, it is not the only way to uplift and empower them. There are other alternatives that can be more effective and sustainable in the long run.

One alternative is to invest more in human capital development, which means improving the quality and access of education, health and skill development for the people. This can help them acquire the knowledge, skills and abilities that are required for the modern economy and society. It can also enhance their employability and income potential, and reduce their dependence on government handouts.

Another alternative is to create more employment opportunities and livelihoods for the people, especially in the rural and informal sectors. This can be done by promoting entrepreneurship, innovation and self-employment among the youth and women. It can also be done by supporting small and medium enterprises (SMEs), cooperatives and self-help groups (SHGs) that provide jobs and incomes to millions of people. It can also be done by developing infrastructure, agriculture and allied sectors that can boost economic growth and generate demand for labour.

A third alternative is to strengthen social security and protection for the people, especially the vulnerable and marginalised groups. This can be done by providing universal health coverage, pension schemes, insurance schemes and social assistance programmes that can protect them from shocks and risks. It can also be done by ensuring social justice and inclusion for all sections of society, such as women, dalits, adivasis, minorities and differently-abled persons. It can also be done by enforcing labour laws and rights that can safeguard the interests and dignity of workers.

These alternatives are not mutually exclusive, but complementary to each other. They can also complement the existing welfare schemes of the Congress government, but with more focus on outcomes and impact rather than inputs and outputs. They can also reduce the fiscal burden on the state budget and improve its efficiency and effectiveness.

The Congress party has a golden opportunity to transform Karnataka into a model state by adopting these alternatives to freebies. It can also set an example for other states and parties to follow. It can also fulfil its vision of creating a peaceful garden of all communities in Karnataka.

Conclusion: Freebies are not enough, Karnataka needs more

The Congress party has won a historic mandate in the Karnataka assembly elections by promising a host of freebies and welfare schemes to the people. While these schemes may have some positive effects on the lives and livelihoods of the people, they are not enough to address the deeper and broader challenges that the state faces. The state needs more than freebies, it needs a holistic and long-term development strategy that can enhance its human capital, create more employment opportunities and livelihoods, and strengthen its social security and protection. These alternatives can not only uplift and empower the people, but also make them more self-reliant and resilient. They can also improve the fiscal health and governance of the state, and make it more competitive and progressive. The Congress party has a golden opportunity to implement these alternatives and transform Karnataka into a model state for the rest of the country. It can also fulfil its vision of creating a peaceful garden of all communities in Karnataka.


Source: 

(3) Karnataka CM Siddaramaiah Targets PM Modi, Says How Many Promises Were Fulfilled By Him. https://www.outlookindia.com/national/karnataka-cm-siddaramaiah-targets-pm-modi-says-how-many-promises-were-fulfilled-by-him-news-293707.
(4) Times Now Access Internal Note Of Finance Department On Congress' 5 Poll Promises In Karnataka. https://www.msn.com/en-in/news/other/times-now-access-internal-note-of-finance-department-on-congress-5-poll-promises-in-karnataka/vi-AA1cmMGp.
(6) Assembly Election Karnataka Manifesto - 2023 - Indian National Congress. https://www.inc.in/media/press-releases/assembly-election-karnataka-manifesto-2023.
(8) Congress Karnataka Manifesto - 2023 | PDF - Scribd. https://www.scribd.com/document/642173247/Congress-Karnataka-Manifesto-2023.


FAQ's

How much will the Congress promises cost in Karnataka?

The Congress' pre-election promises will cost Karnataka around Rs 50,000 crore. The Congress' stunning victory in Karnataka has given the party a shot in the arm ahead of assembly elections in the key states of Rajasthan, Madhya Pradesh, and Chhattisgarh later this year and the Lok Sabha elections in 2024.

What are the freebies promised by Congress in Karnataka?

Congress in the run-up to elections had given five major guarantees — ₹2,000 monthly assistance to women heads of all families ( Gruhalakshmi), 200 units of power to all households ( Gruhajyoti), ₹3,000 every month for graduate youth and ₹1,500 for diploma holders ( Yuvanidhi), 10 kg rice per person per month( ...

What are the 5 promises of Karnataka Congress?

What are the 5 promises made by the Congress? ● 200 units of free power to all households under the Gruha Jyoti scheme. ● ₹2,000 monthly assistance to the woman head of every family, which comes under the Gruha Lakshmi scheme. ● 10 kgs of rice to every member of a BPL household - as part of the Anna Bhagya scheme.

How much does freebies cost in Karnataka?

How much would the freebies account for in the state's Budget? The estimate of Rs 62,000 crore amounts to nearly 20% of the state budget. The amount that could be spent on major freebies is as large as the fiscal deficit in the previous financial year.

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