Working Paper

Social Sector Priorities: An Analysis of Budgets and Expenditures in India in the 1990s

Published on 1 January 2002

This paper analyses social sector priorities of the Indian government in the period 1990-2001.

This is done by a study of the most crucial policy documents: the annual budgets. The budgets are studied from three angles:

(a) the budget speeches, that is the justification that the government gives for its allocation decisions and expenditures, (b) the actual expenditures, and (c) the budget making process.

The study of the budget speeches shows that the poor play an important role in the justification of economic policies. Nothing, however, is said about social inequality and redistribution of wealth. In the course of the 1990s, the (implicit) conceptualisation of poverty changed in the budget speeches. Initially the main emphasis was on income and employment. From 1996 onwards, the emphasis shifted to include other human development aspects, such as health, education and housing, but also rural roads. This shift in prioritisation in the budget speeches corresponds with a shift in expenditure patterns.

From 1996 onwards, out of total social sector expenditure, the share for rural development (and especially for wage labour programmes) went down. The analysis of the budget making process revealed that the process is not very participatory or democratic. Although the Finance Ministers claim that the budgets are made for the poor, they are certainly not made in consultation with them. The balance of power between the Finance Ministry and the Planning Commission has shifted in favour of the former.

The paper concludes that, although the widening up of the concept of poverty is positive in a sense, within the overall context of structural adjustment it has facilitated the politically convenient neglect of other dimensions (income and work). There is an urgent need to step up anti-poverty and social sector expenditure, but it is unlikely that this is going to happen in the near future, unless there will be changes in the budget making process.

Publication details

published by
Mooij, J. and Mahendra Dev, S.
IDS Working Paper, issue 164
1 85864 433 X


About this publication


Related content