The RBI’s recently released report, State Finances: A Study of Budgets of 2023-24, had a section devoted to the research and development spending of the State governments. The study covered only 10 out of 36 States and Union Territories implying that research is not a priority for most States. The annual spending on research was also quite small in most States (0.09 per cent of the GSDP on average), though Rajasthan emerged an outlier. 

“These States have budgeted R&D expenditure at 0.09 per cent of GSDP for 2023-24. These expenditures are primarily dominated by medical, health, family, welfare, sanitation and agricultural research,” notes the report. 

A closer look at the numbers shows a huge disparity in allocation for R&D among States. On one hand, there is Rajasthan, which has budgeted a whopping ₹6,143.1 crore for R&D, which amounts to 0.39 per cent of its GSDP. On the other hand, large States like Bihar and West Bengal have allocated just about 0.01 per cent of their GSDPs.  

Rajasthan leads the game? 

Data available for the last five financial years show that over this period, Rajasthan always spent the most money on R&D, both in terms of absolute numbers and as a percentage of GSDP. Between FY20 and FY24, the State’s expenditure here grew by a massive 170 per cent.

Every year, a major portion of this allocation went towards medical, health, family welfare and sanitation. In FY24, the allocation in this field was close to 90 per cent of the total R&D budget. 

While the numbers look great on paper, people with knowledge of the subject have a different story to tell. Rajesh Kothari, a Distinguished Professor at IIHMR University, Jaipur, and a former professor at the University of Rajasthan, says, “The money earmarked for R&D was mostly used towards populist schemes and distributing freebies.” He adds, “It was just an attempt by the previous State government to stay in power and later win the 2023 elections.” 

A senior academic based in Jaipur concurred saying, “There wasn’t any money invested towards R&D, but rather these funds were diverted towards distributing freebies,” she said. 

However, another senior economist with knowledge of the matter said that during the Gehlot government’s term, a lot has been done to improve the quality of government hospitals across the State. “There has been a tremendous improvement in the quality of medical facilities and medical services during the last five years,” he said.  

Agri in focus 

Of all the 10 States and UTs that revealed their R&D investment numbers, four have invested a major proportion of this budget towards agricultural research. These States include Tamil Nadu, West Bengal, Jammu and Kashmir, and Haryana. This has been the case in all these States in the last five financial years. 

Karnataka, too, invested most of its R&D budget in this field until FY21. However, trends started shifting since then. The State now invests more in medical, health, family welfare and sanitation. In Odisha, most of the allocation went towards education — ₹500.1 crore and in Sikkim, the focus was environmental research where it spent ₹11.1 crore.