Assessing the Fiscal Impact of Freebie Politics in Indian States: A Comparative Case Study of Tamil Nadu and Delhi

Rashmi Kumari; Rutuja Vitthalrao Deshmukh

doi:10.36948/ijfmr.2026.v08i05.88588

Assessing the Fiscal Impact of Freebie Politics in Indian States: A Comparative Case Study of Tamil Nadu and Delhi

Author(s)	Ms. Rashmi Kumari, Ms. Rutuja Vitthalrao Deshmukh
Country	India
Abstract	In recent years, the surge in populist "freebie politics" has become a defining feature of electoral strategies in Indian states, with Tamil Nadu and Delhi standing as prominent examples of this phenomenon. This paper delves into the fiscal health implications of these freebie policies, scrutinizing their impact on both immediate political gains and long-term financial stability. Drawing on secondary data from state budgets, Reserve Bank of India (RBI) reports, and previous research studies, the analysis focuses on a comparative examination of the two states. By evaluating key fiscal indicators such as state GDP, receipts, expenditure, fiscal surplus, debt levels, and growth rates, this paper explores how these policies shape the financial landscape of Tamil Nadu and Delhi. The study uses a blend of regression analysis and fiscal modeling to assess the relationship between social expenditure and fiscal deficits, unveiling the delicate balance between welfare provisioning and state fiscal health. Additionally, the paper probes the broader economic, social, and political consequences of these freebies, analyzing their effects on poverty reduction, literacy rates, unemployment, and social sector investment. In doing so, the paper evaluates whether these policies have indeed benefited the political parties or merely resulted in temporary electoral advantages that may harm long-term fiscal sustainability. While freebie policies may bring short-term welfare gains, the paper finds that they are often accompanied by rising debt, fiscal deficits, and social inequality, potentially undermining the broader development agenda. Ultimately, the study advocates for a more targeted, transparent, and sustainable approach to welfare schemes, which balances electoral populism with long-term financial and social sustainability. This research provides valuable insights into the complex interplay between fiscal policy, political strategy, and social welfare in India’s state-led governance model.
Keywords	Fiscal indicators, Freebie politics, Welfare schemes, Debt, Sustainability
Field	Sociology > Economics
Published In	Volume 8, Issue 5, September-October 2026
Published On	2026-09-27
DOI	https://doi.org/10.36948/ijfmr.2026.v08i05.88588

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Assessing the Fiscal Impact of Freebie Politics in Indian States: A Comparative Case Study of Tamil Nadu and Delhi

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