Union Budget: Nirmala Sitharaman Contemplates New Cash Transfer Scheme For Poor Urban Women, Here's Why

Before the announcement of the Union Budget 2024, the Union government is reportedly thinking about a proposal for a cash transfer scheme for the poor urban women.

This scheme will aim to boost consumption and demand in a sector where it has been notably weak.

According to a report from Deccan Herald, technicalities are still being finalised and if Finance Minister Nirmala Sitharaman decides to take this in her budget speech, it will present its own issues.

These potential issues may include identifying the beneficiaries and the near impossibility of withdrawing the scheme in future years due to political reasons.

Recently, domestic consumption is largely being driven by the urban upper middle-class and the affluent, while the rural economy is improving due to anticipation of a good rains ahead. This leaves the urban poor as a particularly vulnerable group.

“There have been discussions on a cash transfer scheme for urban women from the unorganised sector. It is under consideration, and the identification of beneficiaries may be done through the ‘e-shram’ portal,” an official has been quoted as saying.

The official further added that increasing purchasing power among the urban lower-income group is a priority for the government

Although India remains the world’s fastest-growing major economy, much of this growth has been driven by public spending on infrastructure projects. Household consumption, meanwhile, has remained relatively subdued.

Sitharaman is set to present the Union Budget 2024 on 23 July.