INDIAN WELFARE MODEL: EVOLUTION, CHALLENGES, WAY FORWARD

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Picture Courtesy:  THE HINDU

Context

India's welfare state approach, with billion Aadhaar enrollments and 1,206 schemes integrated, is shifting towards technocratic calculus, delivering efficiency and coverage at the cost of democratic norms and political accountability.

What is the Meaning of Welfare State?  

It represents the government's commitment to ensure the overall well-being and social security of its citizens. This includes their physical, mental, social, and financial health.

It includes a wide range of state-led interventions aimed at reducing poverty, inequality, and improving the quality of life for all.

Indian Welfare Model

Needs-based initiatives: Focuses on fulfilling the basic needs of vulnerable sections. This includes essential services like food, housing, healthcare, education, and pensions.

• Examples include the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) providing free food grains, and the Pradhan Mantri Awas Yojana (PMAY) for housing.

Rights-based legislation: Provide welfare services as a right to the entire population.

• This includes policies like the Right to Education Act 2009 and the National Food Security Act (NFSA), 2013, which guarantee education and food security respectively.  

Welfare elements in the Constitution

Preamble: Declaring India a "Sovereign Socialist Secular Democratic Republic" and aiming for "Justice—social, economic and political; Liberty; Equality; and Fraternity" for all citizens.

Directive Principles of State Policy (DPSPs) (Part IV): Guide the state to establish a social order that promotes welfare and reduces inequalities.

• Article 38: State to ensure social, economic, and political justice and minimize inequalities.
• Article 39: Adequate livelihoods, equitable resource distribution, and preventing wealth concentration.
• Article 46: Promoting the educational and economic interests of "weaker sections of the people, and, in particular, of the Scheduled Castes and the Scheduled Tribes," protecting them from exploitation.
• Other DPSPs: Cover areas like village governance, the right to work, education, public assistance, working conditions, and a uniform civil code.

Fundamental Rights (Part III): Enforceable in court and protect individual dignity and promote inclusivity.

• Right to Equality (Articles 14-18): Prohibits discrimination and abolishes untouchability.
• Right against Exploitation (Articles 23-24): Prohibits human trafficking, forced labor, and child labor.

Affirmative Action (Reservations): Constitution allows for reservations for marginalized communities to address historical injustices.

• Articles 15(4) and 16(4) empower the state to make provisions for backward classes and Scheduled Castes (SC) and Tribes. 

Evolution of Indian Welfare Model  

Post-independence

Constitutional commitment: Included the concept of a welfare state in the Constitution.

Five-Year Plans: The Planning Commission, established in 1950, integrated social welfare into its Five-Year Plans.

Key schemes and initiatives: To tackle issues like poverty, unemployment, and social inequality

• Green Revolution addressed food security
• Integrated Child Development Services (ICDS), launched in 1975, focused on children's welfare.

Institutional Framework: Dedicated Department of Social Welfare, later an independent ministry of Ministry of Social Justice and Empowerment.

Liberalization and targeted welfare (1990s-2000s)

Shift to targeting: Economic reforms shifted towards liberal market policies and reduced state intervention, shifted focus on the identification and support of specific vulnerable groups.  

Key initiatives: Programs like the National Social Assistance Program (NSAP) provided direct assistance to the elderly, widows, and people with disabilities

• The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) of 2005 guaranteed 100 days of wage employment in rural areas.
• The National Food Security Act of 2013 ensured access to subsidized food grains for eligible households. 

Technology-enabled welfare delivery (2010s-present)

Digital Integration: The "JAM trinity" - Jan Dhan bank accounts, Aadhaar identification, and Mobile connectivity - forms the backbone of digital welfare delivery.

Direct Benefit Transfer (DBT):  Transfers benefits and subsidies directly to beneficiaries' bank accounts, ensuring timely delivery and eliminating intermediaries to prevent fraud.

• DBT has resulted in cumulative savings of ₹3.48 lakh crore by reducing leakages.

Aadhaar: 12-digit unique ID, ensure authentication for beneficiaries, agencies can authenticate a beneficiary's identity.

Jan-Dhan Accounts: Pradhan Mantri Jan Dhan Yojana (PMJDY), launched in 2014, opened savings accounts for unbanked individuals.

• By August 2025, over 55.90 crore accounts had been opened.
• These accounts include RuPay debit cards and overdraft facilities, boosting financial inclusion. 

Mobile Banking: Allowing beneficiaries to access funds easily. As of 2023, India had over 1.2 billion mobile subscribers.

Success of Indian Welfare Model

Health Outcomes: The Total Fertility Rate (TFR) has decreased from 2.7 in 2005-06 to 2 in 2019-21, reaching the replacement level.

• Reduced Maternal Mortality Ratio (MMR), achieving the National Health Policy target of less than 100 per lakh live births, reaching 88 in 2020-22.
• Ayushman Bharat has provided health insurance coverage to 12.37 crore families, benefiting nearly 55 crore individuals, as of June 2025.

Education Access: Net Enrolment Rate (NER) at the secondary level (Grades 9 and 10) increased from 44% in FY 2012-13 to 48% in FY 2021-22.

Social Protection Expansion: India's social protection coverage has doubled from 24.4% in 2021 to 48.8% in 2024, according to the International Labour Organization's (ILO) World Social Protection Report (WSPR) 2024-26.

• Nearly 65% of the population, are now covered by at least one form of social protection.
• Schemes like Ayushman Bharat, Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), and the eShram portal (unorganized workers' registration) expanding social security access.

Poverty reduction: Multidimensional Poverty Index dropped from 53.8% in 2005-06 to 15.5% in 2022-23. 

Challenges in India's welfare model

Income disparities: Studies like the World Inequality Lab indicate increase in income and wealth inequality. The top 10% of earners in India hold 57.7% of the national income, whereas the bottom 50% earn only 15%.   

Gaps in social security coverage: Periodic Labour Force Survey Annual Report 2021-22 highlights that 53% of the salaried workforce lacks social security coverage.

Implementation challenges: Corruption and leakages continue to plague welfare schemes like the Public Distribution System (PDS).

• Nearly 28% of subsidized grains intended for the poor are lost due to leakage.  

Privatization and access barriers: In privatized sectors with limited competition, the prices of goods and services can rise, making them unaffordable for low-income populations.

Budgetary constraints: Union Budget has witnessed declining allocations for welfare schemes as a proportion of GDP over the years.  

• Despite the pandemic exposing healthcare system gaps, the allocation to the Ministry of Health declined from 2.16% of the budget in 2019–20 to 1.88% in 2024–25.
• Reduced funding lead to decreased benefits, tighter eligibility criteria, or even the elimination of certain programs.  

Way Forward to Strengthen the Welfare Model

Strengthen implementation: Strengthen the capacity of local administrators and Panchayats.

• Involve vulnerable sections in the design and planning of welfare schemes to ensure they meet their specific needs and priorities. 

Enhance budget allocation and financial mechanisms: Increase the proportion of the Union Budget allocated to social sectors

• The National Health Policy target of 2.5% of GDP for healthcare spending, and 6% of GDP on education under New Education Policy, needs to be met.

Improve scheme design: Implement and expand Conditional Cash Transfers (CCTs) that link benefits to positive behaviors, like school attendance or healthcare visits, to promote human capital development.

• Design schemes that address specific needs and vulnerabilities, rather than a "one-size-fits-all" approach, like NITI Aayog's Aspirational Districts Programme (ADP).

Leverage technology responsibly: Bridge the digital divide by improving digital literacy, under digital India, expand internet connectivity.

Promote social justice and inclusivity: Eliminate caste, gender, and regional biases that hinder access to welfare benefits and opportunities.

Enhance accountability and transparency: Establish independent monitoring bodies to evaluate the efficacy of welfare schemes and accessible grievance redressal mechanisms to address beneficiary complaints.

Source: THE HINDU