Delhi’s Free Money Plan for Women Faces Fiscal Hurdles

Delhi’s Free Money Plan for Women Encounters Fiscal Hurdles

Financial Concerns Mount Over ₹1,000 Monthly Allowance

Delhi’s ambitious plan to provide ₹1,000 per month to women older than 18 faces mounting financial challenges, raising concerns about the scheme’s feasibility. The Mukhya Mantri Mahila Samman Yojana (MMMSY), aimed at economically supporting around 38 lakh women in Delhi, is projected to cost ₹4,560 crore annually, a figure that is triggering alarm bells in the finance department.

Projected Deficit Casts Shadow Over Ambitious Plan

The finance department has cautioned that implementing MMMSY from the 2025-26 fiscal year could lead to a significant budgetary deficit. With Delhi’s subsidy bill already nearing ₹11,000 crore, the added expenditure from MMMSY, alongside other commitments like a ₹2,500 crore grant to the Delhi Jal Board, could push the city’s revenue liability to ₹7,000 crore in the upcoming fiscal year. “There is a serious possibility of significant revenue and budget deficits and cash imbalances,” a communication from the finance department warned Chief Minister Atishi.

The department highlighted that unlike other states, Delhi cannot raise market loans and must rely on the costlier National Small Saving Fund for borrowing. This limited financial flexibility further complicates the situation.

Chief Minister Remains Optimistic but Cautious

Though acknowledging the concerns, Chief Minister Atishi has emphasized that it is premature to conclude whether MMMSY can be implemented within the current fiscal year. She points out that the 2024-25 budget already allocated ₹2,000 crore for the scheme. “It is too early to decide whether MMMSY shall be implemented in FY 2024-25 or not,” she stated. Atishi maintains that while implementation timelines might vary, the government remains committed to the program’s goals.

Sources within the administration remain optimistic, suggesting that higher-than-expected revenue collections might soften the financial blow. “Revised estimates passed in the assembly are ₹1,700 crore higher than the budget estimate,” a source stated, dismissing concerns about an immediate revenue deficit.

Political Implications of Cash Handouts Resurface in India

The discussion surrounding MMMSY comes at a time when cash handouts to voters, particularly women, are gaining traction in Indian politics. This strategy was demonstrated in the recently concluded Maharashtra state elections, where the BJP-led coalition implemented a ₹1,500 monthly financial assistance program for 2.5 crore women.

This initiative, included in the state budget and targeted primarily at rural and economically disadvantaged areas, appears to have significantly contributed to the BJP’s commanding victory. Analysts suggest that the cash handout program not only addressed immediate financial needs but also served as a targeted political tool to bridge the electoral gap.

The success of such programs in India underscores the country’s socio-economic inequalities and highlights the political value of directly targeting underprivileged groups with financial assistance. However, observers also caution about the long-term fiscal impact of such measures on state budgets, urging a careful balance between immediate relief and sustainable economic policies.

What are some⁣ potential⁣ financial challenges facing ⁣the Delhi government⁤ in implementing the Mukhya‌ Mantri Mahila Samman Yojana?

‍## Delhi’s Free Money ‌Plan: Can the

City Afford It?

**Host:**​ Welcome back to⁣ the ⁤show. Today we’re tackling a hot⁤ topic: Delhi’s ambitious plan to provide ‌₹1,000 ‌per month to women over 18.​ The ​Mukhya Mantri Mahila Samman Yojana, while popular, is raising ⁣some serious questions about ‍its financial feasibility.‌ Joining ‌us to⁣ discuss this is⁣ Dr. Anita Sharma, a leading economist with expertise in state finances. Dr. Sharma, thanks for being here.

**Dr.‍ Sharma:** It’s a pleasure to be here.

**Host:** Let’s dive right in. This scheme is set to ‌cost ₹4,560 crore annually – a significant chunk of change.

Are these concerns about affordability justified?

**Dr. Sharma:** Absolutely.​ As⁤ the article⁢ from the Economic Times points‍ out [[1](https://economictimes.indiatimes.com/news/economy/finance/free-cash-everywhere-states-election-win-pitch-with-maha-freebies-comes-with-big-budget-burden/articleshow/116066629.cms)], Delhi already ⁢has ⁢a ​hefty subsidy bill nearing ₹11,000 ⁤crore. ⁢Adding another ₹4,560 crore, ‍ plus a ₹2,500 ​crore grant to the ​Delhi Jal Board, could ‍push the city’s revenue liability to ⁢a staggering ₹7,000 crore. That’s ⁤a recipe for ⁣a serious budget deficit.

**Host:** So, what options does the Delhi government have?

**Dr. Sharma:** They’re in ⁢a tough spot. Compared to other states, Delhi‌ has limited financial flexibility. They can’t raise market loans and rely on​ the pricier National Small Saving Fund. This makes it harder to cover such a costly program.

**Host:** Chief Minister ‍Atishi has acknowledged these concerns but remains optimistic.⁤ Does she have a point?

**Dr. Sharma:** While optimism is a good thing, caution⁢ is warranted. It’s crucial to thoroughly assess the long-term financial implications before ‌proceeding. Perhaps⁢ phasing in the program⁢ or exploring alternative funding mechanisms could be considered.

**Host:** It will be interesting to see how this unfolds. ​Dr. ‍Sharma, thank you for sharing ‌your insights.