The Central government is likely to end FY25 with lower value of Direct Benefit Transfers (DBT) with DBTs under fertilizer, scholarships, rural housing scheme in the slow lane.

Businessline’s analysis of the central DBT Mission dashboard shows that DBTs to the tune of ₹4,15,343 crore have been recorded in FY25 (till December) — a decline of almost 20 per cent when compared with the corresponding period in FY24. The DBT value also recorded a marginal YoY decline of 3.5 per cent in FY24.

Declining numbers

Scheme-wise analysis shows that benefit transfers under the fertilizer, scholarships, public distribution scheme (PDS) and PMAY-G rural housing schemes are likely to end FY25 on lower note compared to FY24. Of these, PMAY-G, PDS and fertilizer DBTs are declining progressively from FY23.

In case of fertilizers DBT, the government provides subsidies to the manufacturers who sell the fertilizers to farmers. The DBT appears to have been lower due to the prices of fertilizers which were down in 2024 compared to 2023.

The lower DBT transfer for rural housing scheme of PMAY-G is another cause for concern as it reached ₹16,566 crore in December, accounting for only 30 per cent of the budgeted outlay of ₹54,500 crore in FY25. This is despite the 2024 Budget increasing the scheme’s per-unit assistance. Originally targeting completion of 2.95 crore houses by FY24, the scheme also got extended till FY29 with additional 2 crore houses. As of November 2024, 3.21 crore houses have been sanctioned, of which 2.67 crore houses have been completed.

As for PDS, this is a combination of direct cash transfer for food grains and PDS operations across States. Transfers under PDS were down 10 per cent in FY24. If the nine-month date until December 2024 is extrapolated for a full year, transfer under PDS is likely to be down 16 per cent in FY25.

Worrying trend

The National Social Assistance Programme (NSAP), which provides financial aid to the elderly and persons with disabilities, has also been on the decline since FY22. Two studies of the NSAP in recent years — by the NITI Aayog and the Rural Development Ministry — have recommended a hike in pension and coverage. Similarly, the reduction in central scheme scholarship DBT for financial assistance to students from marginalised groups is also concerning.

In FY25, the DBTs for fertilizer and PDS schemes recorded the maximum values at ₹1.21 lakh crore and ₹1.07 lakh crore respectively. The Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) was the third highest receiver of DBT at ₹52,491 crore.

Another notable trend in the last six fiscal years is the rise in kind-based transfers. They accounted for 61 per cent of the total DBT compared to 37 per cent in FY20.

The DBT Mission also assigns DBT rankings to the States based on their performance, on parameters like Aadhaar saturation, data reporting, savings-expenditure ratio and DBT per capita, among others. While Haryana, Uttar Pradesh and Tripura have been in the top three across the last six fiscals, Assam, Telangana and West Bengal are in the bottom ranks.