Telangana and AP give more via social welfare programmes than Bihar, UP and Jharkhand

Consumption boosted by social welfare programmes picks up faster for poorest states

Telangana, Karnataka, Andhra Pradesh shell out more than poorer states like Bihar, Jharkhand and UP on social welfare programmes, according to a Moneycontrol analysis of Household Consumption Expenditure Survey 2023-24.

The impact of social welfare programmes on consumption was higher in Telangana, with imputed value of consumption 4.4 percent higher in rural areas than household spending without freebies, while UP’s consumption was much lower at 2.8 percent.

Andhra Pradesh’s rural households also consumed 4 percent more after imputation of social welfare programmes, compared to 3.2 percent for Bihar.

The gap was much lower for urban areas, where Andhra Pradesh urban households consumed just 2.2 percent owing to imputation, while the difference in Bihar was 1.7 percent.

2023-24 also witnessed a boost in social welfare programmes-led consumption. While imputation added 2.3 percent to household spending in rural areas and 1 percent in urban areas in 2022-23, the contribution increased to 3 percent and 1 percent, respectively, in 2023-24.

The country also became more equitable. The poorest states, with the per capita income of Rs 60,000, consumed 3 percent more in rural areas, compared with 1.9 percent a year ago.

The increase for richest states, with per capita income of Rs 1.2 lakh per annum, was much less pronounced at 2.4 percent higher compared with 1.9 percent earlier.

The poorest states could not catch up as much in their urban areas, with consumption jump lower than richest states.

There were disparities in statewide increments as well. Odisha’s consumption due to increments was up 3 percentage points compared with the previous year, while Chhattisgarh’s went up 2.4 percentage points from 2022-23.

Chhattisgarh has highest value of imputation at 6.9 percent higher than normal spending in rural areas.

Southern and eastern states spent more on 2023-24, than northern and western states.