In a heated session of India’s Lok Sabha on December 9, 2025, Congress MP Manish Tewari sounded the alarm over what he described as a dangerous and growing trend: the use of government cash transfers as a last-minute electoral strategy. Tewari, known for his pointed interventions, called for a constitutional amendment to curb such practices in states and at the central level when public debt soars past a critical threshold. His argument? That these pre-election cash handouts, while politically expedient, are pushing India toward a looming financial crisis and threatening the very foundation of its democracy.
"This growing trend of distributing money, that as elections approach the government starts transferring cash directly into people's accounts, what kind of democracy is this?" Tewari asked, addressing his fellow lawmakers. According to ANI, he continued: "Is this what democracy has become, that 15 days before elections, 20 days before, a month, or even two months earlier, you start depositing money into people's accounts? And this is why I am concerned, there is a serious misuse of democracy, and a major manipulation of India's revenues."
Tewari’s proposal is as bold as it is controversial. He wants to amend the Constitution by adding a new Article—293A—that would specifically prohibit cash transfers by any state or the central government if their debt-to-GDP ratio exceeds 20 percent. In an ideal world, he added, the threshold should be even lower, at just 10 percent. "You cannot win elections at the cost of the national exchequer or the state exchequer," he insisted, warning that such practices could "absolutely bankrupt our democracy and bankrupt our country."
His remarks come at a time when India’s public finances are under unprecedented strain. As of March 24, 2025, the combined liabilities of the central and state governments stood at a staggering Rs 2.67 lakh crore, Tewari noted in Parliament. He highlighted that, for the fiscal year 2023-24, a whopping 18 out of 28 Indian states had a debt-to-GDP ratio exceeding 30 percent. That’s not just a statistic—it’s a flashing red warning sign for policymakers and the public alike.
Tewari’s critique zeroes in on a pattern that has become all too familiar in Indian politics. According to a report by Emkay Research, states’ spending typically ramps up after elections, with nearly every government—regardless of party—rolling out new welfare schemes and so-called “freebies,” especially targeted at women voters. These programs, once introduced, are notoriously difficult to scale back. The report observed that this “stickiness” in welfare spending means that government outlays rarely return to pre-election levels, even as new schemes are layered on top.
Looking at the most recent election cycle, the Emkay report noted that 10 major states went to the polls over the last two years—five in fiscal year 2024 and another five in 2025. On average, these states saw their fiscal deficit-to-GDP ratios jump by one percentage point during the election year, and then remain stubbornly high the following year. This pattern, the report suggests, is not a one-off but a structural feature of India’s electoral politics.
Tewari’s solution is rooted in constitutional law. He pointed out that the Indian Constitution already grants Parliament the authority to set borrowing limits for both the central and state governments under Articles 292 and 293. Article 292 deals with federal borrowing, while Article 293 governs the states’ borrowing powers. But, in his view, these provisions don’t go far enough to prevent the misuse of public funds for electoral gain. "There is a need to add one more Article -- Article 293A -- and it should specifically state that if the debt-to-GDP ratio of the central government or any state government is more than 20 per cent, ideally it should be 10 per cent--then that state government or the central government should not be allowed to make any cash transfers," he argued.
What’s driving this sense of urgency? Tewari fears that, without such a safeguard, the cycle of pre-election cash transfers will only intensify. "No state government will ever change. Elections come, and someone transfers Rs 20,000, someone Rs 15,000, someone Rs 35,000 into people's accounts, and they get elected again. Meanwhile, the debt of your state keeps rising, and there are several states in this country that take additional loans just to pay the interest on their existing debt," he cautioned, as reported by ANI.
His warnings are not without precedent. Over the past two decades, Indian states have increasingly relied on welfare schemes and direct transfers as a means of securing electoral support. While these programs can provide genuine relief to struggling families, critics argue that they are often deployed with an eye toward the ballot box rather than long-term fiscal responsibility. Supporters of such cash transfer programs, on the other hand, contend that they are essential tools for poverty alleviation and social justice, especially in a country as vast and diverse as India.
The debate over pre-election cash transfers is hardly unique to India. Around the world, governments have faced similar dilemmas—balancing the need to support vulnerable populations with the imperative of maintaining fiscal discipline. But what sets the Indian case apart, as Tewari and others argue, is the sheer scale of the borrowing involved and the risk that political expediency could override sound economic management.
Not everyone is convinced that a constitutional amendment is the right answer. Some political analysts argue that the problem is less with the existence of welfare schemes themselves and more with their timing and lack of transparency. Others warn that setting rigid debt-to-GDP thresholds could tie the hands of governments during genuine emergencies, such as natural disasters or economic shocks, when cash transfers might be not just desirable but necessary.
Still, Tewari’s intervention has sparked a national conversation about the sustainability of India’s public finances and the ethics of electoral politics. His proposal, if adopted, would represent a significant shift in the way Indian governments are allowed to spend public money in the run-up to elections. It’s a debate that pits short-term political gains against long-term economic stability—a balancing act that every democracy must confront sooner or later.
As India looks ahead to future election cycles, the question remains: can the country find a way to support its most vulnerable citizens without mortgaging its financial future? For now, the issue is firmly on the national agenda, thanks to one MP’s determined call for reform.
