India’s central bank described the government’s spending on the health & education sectors in its federal budget as “woefully” below peers.
The report was published as part of the Reserve Bank of India’s April bulletin where the central bank observed that “In terms of GDP, the social sector expenditure, primarily constituting health & education, in India continues to remain woefully below peers” .
To make matters worse, the government doesn’t have much space to increase spending, given firm crude oil prices and a negative output gap, both of which could hit economic growth and be a drag on revenues.
The conclusion alludes to an analysis of 17 countries, including India, with respect to their social sector expenditure as per cent of GDP (2016).
As per the chart cited in the study, India’s social sector expenditure as per cent of GDP in 2016 was 7.5 %, a far cry from 29 % in Belgium, 15.2 % in Iceland and 10.4 % in Korea, among other countries. (Story courtesy : Wires )