Direct cash transfers to women are becoming increasingly common across India, with 12 states now implementing such schemes, a significant rise from just two in 2022-23. According to a study by PRS Legislative Research, these states are expected to spend a total of Rs 1,68,050 crore on unconditional cash transfers to women this year, which accounts for 0.5% of the country's GDP. This is a notable increase from less than 0.2% of GDP two years ago.

Various states have introduced initiatives like Gruh Lakshmi in Karnataka, Ladli Behna in Madhya Pradesh, Ladki Behin in Maharashtra, and Mukhyamantri Mahila Rozgar Yojana in Bihar. Political parties are leveraging these cash transfers to connect with voters ahead of elections. Beneficiaries have expressed satisfaction with these financial aids, although the state budgets are feeling the pressure.

In anticipation of upcoming assembly elections, Assam and West Bengal have boosted their allocations for these cash transfer schemes. Assam has increased its budget by 31%, while West Bengal has raised it by 15% compared to the previous year's estimates. Additionally, Jharkhand has raised the monthly payout under the CM Maiyan Samman Yojana from Rs 1,000 to Rs 2,500.

However, some states have had to reduce benefits due to financial constraints. For example, Maharashtra cut the monthly benefit under the CM Ladki Bahin Yojana from Rs 1,500 to Rs 500 for women who were also receiving Rs 1,000 from another direct benefit scheme for farmers.

The trend of cash transfers began with farmers in Odisha and has since expanded. The Reserve Bank of India has warned states about the increasing expenditure on subsidies, farm loan waivers, and cash transfers. The PRS report highlights that among the 12 states with unconditional cash transfer schemes, six are projected to have a revenue deficit by 2025-26. Notably, when excluding spending on these cash transfer schemes, Karnataka's fiscal position improves from a revenue surplus of 0.3% of GSDP to a revenue deficit of 0.6% of GSDP, while Madhya Pradesh's surplus drops from 1.1% to a marginal 0.4% of GSDP.