1.

What are the Causes for Increase in Public Expenditure in India?

Answer»

In 1950, public expenditure was Rs. 900 crores and in 2004 it was around Rs.5,05,000 crores. This drastic increase in public expenditure is due to following main reasons. 

They are:

  • Rapid growth of population. 
  • Serious effects of urbanization. 
  • Increase in defence expenditure. 
  • Increase in subsidies, grants and aids. 
  • Increase in administration expenditure. 
  • More developmental and constructive projects undertaken. 
  • Inflation to a certain extent. 
  • Natural and manmade calamities. 
  • Poverty and unemployment. 
  • Effects of democracy.


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