Bihar Poll Blitzkrieg: India’s Welfare Politics Hits Overdrive
PM Narendra Modi with Bihar CM Nitish Kumar in Patna on Thursday (Image credit Bihar Info Dept)
From Tejashwi Yadav’s ₹30,000-a-year promise to Nitish Kumar’s welfare schemes, India’s politics is fast shifting from aspiration to entitlement — but at what cost to the economy?
By AMIT KUMAR
New Delhi, October 29, 2025 — “Indian politics today is no longer aspirational; it has turned deeply welfare-driven,” says journalist Manish Anand, observing a shift from population politics to populism. Every major party now competes in making record-breaking promises of free schemes and cash benefits.
As Bihar heads for assembly polls, the trend is glaring. Opposition leader Tejashwi Yadav has pledged that if elected, his party will ensure one government job per household and pay ₹30,000 annually to women beneficiaries, known locally as ‘Jeevika Didis’ — totaling ₹1.5 lakh over five years.
Chief Minister Nitish Kumar, not to be outdone, has already transferred ₹10,000 each to Jeevika beneficiaries and promised up to ₹2 lakh in additional aid for women who perform well in self-help enterprises.
Across India, similar cash-transfer schemes and unemployment allowances dominate campaign speeches — whether from the Congress government in Karnataka or the BJP-led states of Madhya Pradesh, Haryana, and Maharashtra.
Welfare Politics vs. Productive Economy
Anand draws a parallel with the United Kingdom, where Prime Minister Keir Starmer’s Labour government faces mounting criticism for overreliance on welfare spending. In the name of fairness, Starmer’s government in the UK is taxing the most productive segment of society to subsidize the least productive.”
The outcome: more than 10,800 wealthy taxpayers reportedly left the UK in 2024, relocating to Italy, Portugal, and the UAE, where tax regimes are friendlier.
India, too, is witnessing a similar silent outflow. Reports suggest that thousands of Indian millionaires are moving abroad — many to Dubai — seeking zero income tax and smoother business regulations.
India’s Investment Dilemma
While the government cites record Diwali sales of ₹5.5 lakh crore after GST rate cuts as a sign of strong demand, economists remain skeptical. Without a surge in private investment, they warn, India’s growth story could flatten — and job creation may stall. Corporate India’s cautious spending suggests that expansion is limited to maintaining existing employment rather than generating new opportunities.
The Cost of Populism: From Karnataka to Kerala
Economists point to Karnataka’s fiscal distress as a case study. The state began its term with a budget surplus, but after announcing multiple welfare schemes, it now struggles to pay salaries and pensions.
A similar financial strain is visible in Telangana, Andhra Pradesh, Punjab, and Himachal Pradesh — states that embraced expansive welfare commitments.
In contrast, productive public investments in infrastructure, manufacturing, and job creation have slowed down, reducing the government’s ability to sustain long-term economic growth.
A Cautionary Tale for India’s Leaders
England’s experience — where the top 1% of taxpayers contribute nearly 20% of total income tax and are now leaving in record numbers — should serve as a warning for India.
As welfare populism deepens, India risks alienating its own wealth creators — the entrepreneurs, investors, and job generators essential for growth. Whether Indian leaders recognize this warning and recalibrate their policies toward productive, investment-led growth remains the critical question.
(This is an opinion piece, and views expressed are those of the author only)
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