Freebies vs Welfare - The Dilemma of India’s Economic Democracy
March 22, 2025

Context:

  • The debate over welfare measures and freebies has resurfaced with political parties making populist promises in elections.
  • While welfare schemes are meant to uplift the poor, excessive dependence on freebies raises concerns about economic sustainability, self-reliance, and governance priorities.

Freebies and Political Promises:

  • In the recent Delhi elections, political parties have competed to offer freebies” rather than focus on development strategies.
  • Earlier, a prominent political party’s 2024 manifesto highlights welfare schemes such as:
    • PM Garib Kalyan Anna Yojana – free rations to 80 crore people since 2020.
    • Direct Benefit Transfer (DBT) – ₹34 lakh crore credited to citizens.
    • PM Mudra Yojana – 46 crore loans worth ₹27 lakh crore.
    • PM SVANidhi Scheme – easy credit to 63 lakh street vendors.
  • The question arises: Are these welfare measures or mere electoral inducements?

The Economic Burden of Freebies:

  • Several states, including Maharashtra (admit funding issues for the Ladki Bahin scheme) and Gujarat, struggle with funding social schemes and essential public services like education and healthcare.
  • The government claims 25 crore citizens have moved out of poverty, and 17 crore jobs were created in 10 years, yet freebies continue.
  • Critics argue that such measures can hinder economic productivity and foster dependency.

Constituent Assembly Debates on Socialism and Welfare:

  • On November 15, 1948, a motion to declare India a socialist state was debated but rejected.
  • K T Shah supported socialism, advocating for:
    • Equal justice and opportunity.
    • Economic security for all citizens.
  • B R Ambedkar opposed the motion, stating:
    • The Constitution should not dictate economic policies but leave them to governments elected by the people.
    • Prescribing socialism in the Constitution would undermine democracy.

Economic Democracy and Social Order:

  • Damodar Swarup Seth (discussing Article 38, ‘State to secure a social order for the promotion of the welfare of the people’ in 1948) criticized the capitalist structure, arguing that a socialist democratic order was essential for true welfare.
  • Mahboob Ali Baig Sahib Bahadur emphasized that political parties have distinct ideologies, and voters expect implementation of their agendas.
  • Ambedkar’s perspective on economic democracy:
    • The Constitution sets an economic ideal but does not prescribe a specific system.
    • Economic democracy can take multiple forms, including individualism and state intervention.
  • J B Kripalani’s vision of democracy (1949): Democracy must be both political and economic. The class divide in India limits economic democracy, despite political equality.

India as a Welfare State - Reality Check:

  • A welfare state protects and promotes the economic and social wellbeing of its citizens based on the principles of
    • Equal opportunities,
    • The equitable distribution of wealth and
    • Public responsibility for those citizens who cannot afford the bare necessities of a decent life.
  • India faces challenges such as:
    • Poverty
    • Unemployment
    • Widening wealth gap
    • Failing healthcare
  • The Supreme Court in S.Subramaniam Balaji v. State of Tamil Nadu justified freebies, sparking debate over fiscal responsibility.

Conclusion - Need for Introspection:

  • E M Forster once said: “Two cheers for democracy. One because it admits variety and two because it permits criticism.”
  • In his 1845 novel Sybil (or the Two Nations - the rich and the poor), Benjamin Disraeli writes: “Power has only one duty — to secure the social welfare of the people.”
  • India must evaluate whether excessive freebies align with sustainable economic growth and true welfare.

Enquire Now