India, April 5 -- Indian politics is a polarised space, but only in the social realm. While political parties often trade charges with each other on questions of religion and caste, there is one area where they have been near unanimous in the last decade or so: The growing use of cash transfers of all varieties to generate tailwinds for their campaign. This strategy is almost ubiquitous at the level of state governments. It has created problems both in the present, and more worryingly, the future.

The former is seen in the deteriorating fiscal ability of states to meet their current commitments. Bihar, which implemented a large cash transfer to women scheme before the November 2025 elections, is now struggling to pay salaries and pension...