What are the reasons for increasing government expenditure in India?

1.	What are the reasons for increasing government expenditure in India?
Answer» Reasons for increasing government expenditure in India : (i) Increase in government expenditure in India has been due to the fact that immediately after independence, the government initiated the planning process in order to achieve faster rate of growth by making huge investments in different economic sectors and also on infrastructure. (ii) The expenditure has also increased due to adoption of the principle of welfare state. To maximise people’s welfare, the Government of India also spends a lot on various public welfare activities. (iii) Huge increase in defence expenditure, largely due to threats from neighbouring countries- is also another reason for increasing government expenditure in India. (iv) Grants and aids to the States have been increasing at a rapid rate which has also led to the increase in government expenditure.

Answer»

Reasons for increasing government expenditure in India :

(i) Increase in government expenditure in India has been due to the fact that immediately after independence, the government initiated the planning process in order to achieve faster rate of growth by making huge investments in different economic sectors and also on infrastructure.

(ii) The expenditure has also increased due to adoption of the principle of welfare state. To maximise people’s welfare, the Government of India also spends a lot on various public welfare activities.

(iii) Huge increase in defence expenditure, largely due to threats from neighbouring countries- is also another reason for increasing government expenditure in India.

(iv) Grants and aids to the States have been increasing at a rapid rate which has also led to the increase in government expenditure.

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