Political Freebies In India Electoral Promises And Economic Implications

Freebies, derived from the term "free," often refer to goods and services offered at no cost to the beneficiary. In political contexts, particularly in countries like India, freebies serve as tangible tokens of political promises, especially during election seasons. Initiatives like C.N. Annadurai's ₹1 rice scheme in Tamil Nadu in 1967 highlight the historical allure of such offerings. These freebies can range from essential commodities like food and clothing to more extravagant offerings like electronic appliances, farm loan waivers, and subsidized housing. While proponents argue that freebies help uplift marginalized sections of society and address socio-economic disparities, critics contend that they promote a culture of dependency, hinder economic growth, and undermine the principles of good governance and fiscal responsibility.

The Nature of Political Freebies

Political freebies encompass a wide range of goods and services that political parties promise to provide at no cost to voters. These can include essential commodities like food and clothing, as well as more substantial offerings such as electronic appliances, farm loan waivers, subsidized housing, free electricity, water supply, medicines, insurance, monthly allowances to the unemployed, and even gadgets like laptops and smartphones.

According to the Reserve Bank of India's 2022 report, freebies are described as "public welfare measures that are provided at no cost." This report distinguishes freebies from public or merit goods, such as healthcare and education, which entail expenditure but offer broader and long-lasting benefits. Differentiating between freebies and welfare schemes can sometimes be challenging, but a broad distinction lies in their long-term effects on beneficiaries and society.

Historical Context and Evolution

The practice of offering freebies in Indian politics has deep historical roots. The ₹1 rice scheme introduced by C.N. Annadurai in Tamil Nadu in 1967 stands as an early example of how such offerings can capture public imagination and influence electoral outcomes. Since then, the scope and scale of political freebies have expanded significantly, becoming an integral part of election campaigns across various states and at the national level.

In recent years, the practice has become particularly prominent during assembly elections in states like Uttar Pradesh, Uttarakhand, Goa, Punjab, and Manipur. Political parties from across the spectrum engage in competitive freebie offerings as they seek to secure voter support. During each election season, it is widely recognized that political parties from all backgrounds make ambitious spending pledges in their quest for electoral victory. In their pursuit of electoral triumph, political parties often offer a range of freebies such as electricity, water, and transportation. Among these promises, the commitment to provide free electricity has gained significant popularity.

Arguments in Favor of Political Freebies

Proponents of political freebies present several arguments in their defense:

• Immediate Relief for Marginalized Communities: In a country like India, where a significant portion of the population lives below the poverty line, freebies can provide immediate relief and improve the quality of life for those struggling to meet basic needs.

• Addressing Socio-Economic Disparities: Freebies are seen as a means to alleviate the burden on economically disadvantaged sections of society and demonstrate political commitment to addressing inequality.

• Development in Less Developed States: In states with relatively lower levels of development and larger populations experiencing poverty, freebies can be necessity-driven and crucial for uplifting people through subsidies.

• Economic Growth Catalysts: Some argue that certain government expenditures categorized as freebies can facilitate growth. For example, the Public Distribution System, which involves the free distribution of wheat, sugar, and rice, can contribute to individual and national growth. Similarly, schemes like NAREGA (National Rural Employment Guarantee Act) and free COVID-19 testing during the pandemic have shown positive impacts on the economy. Such practices are believed to improve productivity, build a healthier workforce, and help achieve national goals.

• Industrial Growth: Advocates suggest that freebies can also boost industrial growth by increasing domestic demand and purchasing power among the population.

• Democratic Process: Some argue that election promises, including those involving freebies, are crucial for informing voters about a party's agenda if it assumes power, allowing voters to make informed choices.

Criticisms and Concerns Regarding Political Freebies

Despite these arguments, political freebies face substantial criticism on multiple fronts:

• Promotion of Dependency Culture: Critics contend that freebies promote a culture of dependency among citizens, potentially undermining the work ethic and self-reliance that are essential for long-term development.

• Economic Sustainability: The most significant concern is the economic impact of extensive freebie programs. When political parties offer free electricity, water, and other services, these offerings come at substantial costs to state exchequers. According to a report by the Reserve Bank of India, extensive electricity subsidies not only pose a threat to a state's fiscal stability but also come with significant opportunity costs, limiting funds for other crucial social programs.

• Fiscal Deficit and Debt: The fiscal deficit of many nations is increasing at an alarming rate, and providing freebies can exacerbate this problem. A CRISIL report indicates that many Indian states are already in debt and facing financial deficits, which limits their ability to spend on capital expenditures like building roads, public infrastructure, and hospitals.

• Environmental Impact: Freebies can adversely affect environmental and sustainable growth. It is human tendency to use service or things in excess when provided for free. When services or resources are provided for free, there is a tendency for people to use them excessively, leading to wastage and environmental degradation.

• Potential for Corruption: The freebie practice creates opportunities for corruption. There are often leakages of goods and funds, meaning the actual benefits of providing freebies don't reach the masses as intended. The major issue and challenge with freebie practice is it gives a way to growth of corruption. There Is leakage of goods, funds etc. and hence the actual benefits of providing freebies doesn't reach the mass.

• Hiding Underperformance: Critics argue that some political parties provide freebies to hide their underperformance in governance. When parties fail to deliver on their core promises, they resort to offering free cylinders, food, and other items to prevent voters from switching to other parties. The freebie is also provided to hide the underperformance of political parties. Many parties make promises but fail to keep on their promises. Such parties provide free cylinders, free food, etc. so that people don't switch their vote to other parties.

• Distinction from Welfare Schemes: Differentiating between freebies and genuine welfare schemes can be challenging, but a key distinction lies in their long-term effects on beneficiaries and society. While welfare schemes aim for sustainable development, freebies often focus on immediate electoral gains with little regard for long-term consequences.

Case Studies and Regional Examples

Several Indian states provide compelling case studies in the politics of freebies:

• Karnataka: The state's budget allocations for education and healthcare fall below the average allocations in these sectors compared to other states. This pattern suggests that extensive electricity subsidies and other freebies may be limiting funds available for crucial social programs.

• Punjab: According to recent warnings from the Reserve Bank of India, Punjab is among states like Rajasthan, West Bengal, Bihar, and Kerala that are at high fiscal risk due to freebie politics. Recently, as per RBI, states like Punjab, Rajasthan, West Bengal, Bihar, and Kerala are at risk fiscally. It is warned the financial risk from freebies is highest in the case of Punjab.

• Sri Lanka: Often cited as a cautionary tale, Sri Lanka's government cut taxes and provided free goods and services without properly considering the nation's economic status. For long period, it will lead in financial burden to nation leading to indebtedness. This approach resulted in the collapse of Sri Lanka's economy, demonstrating the potential long-term consequences of unsustainable freebie policies. For example, the Sri Lanka government had cut taxes and provided free goods and services without taking proper care of economic status of the nation. This resulted in collapse of economy of Sri Lanka.

Constitutional and Ethical Dimensions

The practice of political freebies raises important constitutional and ethical questions:

• Resource Allocation: Freebies raise questions about whether public resources are being allocated based on genuine welfare needs or electoral considerations. This touches upon the ethical responsibility of governments to use public funds judiciously.

• Inter-generational Equity: When freebies lead to fiscal deficits and debt, they impose burdens on future generations, raising ethical concerns about inter-generational equity.

• Right to Information: Voters have a right to understand the true cost and sustainability of freebie promises, but complex fiscal issues are often not adequately explained during election campaigns.

• Role of Election Commission: The Election Commission of India has debated whether to regulate freebie promises during elections to prevent unfair electoral practices and ensure fiscal responsibility.

Balancing Immediate Relief and Long-Term Sustainability

The debate over political freebies ultimately hinges on finding a balance between providing immediate relief to vulnerable populations and ensuring long-term economic sustainability. Some suggest that:

• Targeted Interventions: Rather than universal freebies, more targeted interventions based on actual need could provide relief while minimizing fiscal burden.

• Phased Implementation: Free initiatives could be implemented with clear timeframes and exit strategies, preventing them from becoming permanent unsustainable commitments.

• Cost-Benefit Analysis: Political parties should be required to conduct transparent cost-benefit analyses of their freebie promises, showing how they will be funded and their long-term impacts.

• Complementary Policies: Freebies should be part of broader development strategies rather than standalone electoral promises, with complementary policies aimed at improving education, skills, and employment opportunities.

Conclusion

The politics of freebies represents a complex challenge in democratic governance. While freebies can provide immediate relief to marginalized communities and address pressing social needs, their long-term economic and social consequences cannot be ignored. The experiences of various Indian states and the cautionary tale of Sri Lanka demonstrate how unsustainable freebie policies can lead to fiscal crises and hinder overall development.

Moving forward, there is a need for greater transparency in freebie promises, better understanding of their fiscal implications, and a shift toward more sustainable welfare policies that balance immediate relief with long-term development goals. As the debate continues, the challenge for Indian democracy will be to ensure that political competition translates into genuine welfare outcomes rather than short-term electoral gains that impose long-term costs on society and the economy. The culture of offering freebies—such as free electricity, cash transfers, and loan waivers—has become a hallmark of electoral politics in India. While projected as welfare, these promises often represent populist strategies lacking long-term vision and raise concerns over economic sustainability and democratic ethics. Freebies are unconditional, non-targeted giveaways used to gain electoral mileage.

Sources

1. Politics of Freebies
2. Freebies in Indian Politics
3. Political Freebies: Importance, Limitations, Issue and Challenges
4. The Politics of Freebies: A Comprehensive Examination
5. Unpacking Freebie Politics
6. Freebies and Welfare Governance in India