Karnataka CM Siddaramaiah defends guarantee schemes, says it is neither a burden nor inflationary

Bengaluru: The five ‘guarantee’ schemes in Karnataka have “neither burdened the exchequer nor fueled inflation”, Chief Minister Siddaramaiah said on Wednesday, adding that the programmes had increased consumption by stimulating local demand.

Siddaramaiah said this via a written speech in absentia at an event organised by the Fiscal Policy Institute on research findings on the ‘guarantee’ schemes.

Since 2023, the Congress government has allocated over Rs 96,000 crore for the ‘guarantee’ schemes, Siddaramaiah said.

“When the world applauds Karnataka’s Guarantee Schemes as a model for inclusive governance, the Opposition remains busy spreading misinformation and negativity,” Siddaramaiah said.

“Contrary to the sceptics, these schemes have neither burdened the exchequer nor fueled inflation. In fact, by increasing consumption at the bottom of the pyramid, they have stimulated local demand, enhanced revenue buoyancy and reduced rural unemployment,” the CM said, calling it a “bottom-up growth” model.

By implementing the schemes, Siddaramaiah said Karnataka showed that “fiscal expansion can coexist with price stability and equity”. He pointed out that the state’s per-capita income continued to grow even as welfare delivery expanded.

"When we first launched the Guarantee Schemes, our political opponents mocked us. They called it fiscally irresponsible, a “freebie culture” and an election gimmick. But the truth has a way of prevailing. Within months, the same parties began to replicate similar schemes in every poll-bound state without acknowledging their inspiration," Siddaramaiah said, a clear dig at the BJP.

In 2025-26, the government has allocated Rs 51,034 crore for the guarantees. Of this, 56.06% goes to Gruha Lakshmi, 19.79% Gruha Jyothi, 12.59% Anna Bhagya, 10.39% Shakti and 1.18% to Yuva Nidhi.

"Over 1.24 crore women receive support through Gruha Lakshmi, 1.63 crore households benefit from Gruha Jyothi, 4.08 crore people benefit from Anna Bhagya and 2.84 lakh youth receive Yuva Nidhi," Siddaramaiah said, adding that a family of four receives an average monthly benefit of around Rs 10,000 "directly enabling economic stability, higher consumption, and reduced debt dependence".