NEW DELHI (Reuters) – As Prime Minister Narendra Modi completes one year in office, his cuts in federal welfare spending on the poorest of India’s 1.25 billion people are coming in for sharp criticism, including from within his cabinet.
In a break with India’s socialist past, Modi has saved money on federal social and subsidy expenditure and pumped it into an infrastructure stimulus he hopes will trigger a spurt in economic growth.
The government says lower welfare spending will be compensated for by giving state governments a larger allocation of tax revenues to spend as they choose. But state chiefs, government officials and a cabinet minister have warned that the spending shakeup endangers the country’s most vulnerable.
Maneka Gandhi, women and child development minister in Modi’s cabinet, has said the impact of the policy will borne by India’s estimated 300 million poor.
“This may result in a situation where the focus is lost on critical programmes related to malnutrition of children … nutrition for pregnant and lactating mothers,” Gandhi wrote in a April 27 letter to the finance minister, a copy of which was seen by Reuters.
“I am afraid to point out that political fallout of such a situation can be grave.”
Those warnings have been echoed privately by at least three impoverished states who say they are being shortchanged.
