Context: India continues to rank poorly in various global indices such as the Human Development Index, the Global Hunger Index and others. But, despite this, the budget has put less emphasis on the social sector like health, education and food security.

• The budget for 2022-23  shows that the resources allocated for crucial government schemes in the fields of health, education, nutrition, and social protection have remained stagnant or show only a negligent increase. 
• This is not a good indication especially in light of the pandemic whose effect is still being felt across all sectors.

Present condition of Indian economic growth

• Various reports like Oxfam’s ‘Inequality Kills’ and the ICE360 survey, found that the recovery in economic growth in India is K-shaped. It means that the incomes of the poorer sections of the society are decreasing, while those of the richer sections are increasing.
• India has been experiencing increasing inequality over the last couple of decades. Also, there is stagnancy in real wages and an increase in unemployment after 2016.

Key allocations provided to the social sector in the Budget 2022-23

School Education: The government acknowledged learning challenges created by the closure of schools. Yet, the government announced an expansion of the ‘ one class, one TV channel‘ scheme instead of allocations of school. The government needs to focus on school infrastructure, teachers vacancies, etc.

• The budget for school education at Rs 63,449 crores is a slight improvement over last year’s Rs 54,873 crores (2021-22 budget estimates, BE). Allocation to PM Poshan, has also reduced from Rs 11,500 crores last year to Rs 10,233 crores this year.

Public Health System: Despite the pandemic, the budget for the department of health and family welfare has gone up only 16%. Even, the budget for jal jeevan mission increased to 60,000 crores, only 44% of allocated funds were spent as of December 2021. Also, the budget for water and sanitation should not be clubbed with health.

• Public Distribution scheme: Though the national food security act covered only 60% of the population, PDS served as a lifeline during the pandemic period. Eligible persons benefited from additional foodgrains under PMGKAY. But food subsidy of 2.06 lakh crore is only enough to cover NFSA entitlements.
• Schemes: Budgets for important schemes such as Saksham Anganwadi, maternity entitlements and social security pensions are around the same as the allocations for last year. The allocation for MGNREGA at Rs 73,000 crores also does not reflect the increased demand for work or the pending wages of Rs 21,000 crores.

How less allocation of resources can affect the social sector?

• International Labour Organization, shows that the spending on social protection (excluding health) in India is 1.4% of the GDP, while the average for low-middle income countries is 2.5%. 
• Budgets on health and education have also been low, much below the desirable levels of 3% and 6% of the GDP. This together, can impact the inclusive development of India.

Road Ahead

• Greater spending on the social sector can contribute to improvements in human development outcomes, provide a cushion to people during the current economic crisis and also contribute to boosting private consumption demand which in turn can have a positive multiplier effect on the economy. This continued negligence does not bode well for inclusive development in India.