The Supreme Court has flagged a pan-India concern over escalating cash transfers, warning they may hamper economic development. Data for FY26 (Budget Estimates) reveals a stark fiscal tilt: Jharkhand (10.7 percent) and West Bengal (10 percent) lead in earmarking revenue for direct payouts, while Karnataka follows at 9.8 percent. States like Maharashtra, Delhi and Madhya Pradesh also allocate over 6 percent each for such transfers. In 2024, the RBI had warned that states' rising subsidy and cash transfer spending strains finances, urging rationalisation to protect room for productive expenditure.
