Classification of Financial Assistance Provided by Government of India to the Poor

The financial assistance provided by the government of India to the poor people in the country can be classified into two categories: revenue nature expenditure and capital nature expenditure.

Revenue Nature Expenditure

Revenue nature expenditure refers to the expenses incurred by the government for the day-to-day running of the government machinery. The financial assistance provided to the poor people in the form of subsidies, grants, and welfare schemes falls under this category. The revenue nature expenditure does not result in the creation of any asset or the reduction of any liability. The primary purpose of this type of expenditure is to provide immediate relief to the poor people.

The revenue nature expenditure on financial assistance provided to the poor people in the country includes the following:

1. Subsidies: The government provides subsidies on food, housing, education, and healthcare to the poor people. These subsidies are aimed at reducing the financial burden on the poor people.

2. Grants: The government provides grants to the poor people for various purposes such as education, healthcare, and self-employment. These grants are aimed at improving the standard of living of the poor people.

3. Welfare Schemes: The government runs various welfare schemes for the poor people such as National Rural Employment Guarantee Act (NREGA), Pradhan Mantri Awas Yojana (PMAY), and Pradhan Mantri Jan Dhan Yojana (PMJDY). These schemes provide financial assistance to the poor people and help them in improving their living conditions.

Capital Nature Expenditure

Capital nature expenditure refers to the expenses incurred by the government for the creation of assets or the reduction of liabilities. The financial assistance provided to the poor people in the form of infrastructure development and asset creation falls under this category. The capital nature expenditure results in the creation of assets that can be used for a long time.

The capital nature expenditure on financial assistance provided to the poor people in the country includes the following:

1. Infrastructure Development: The government invests in the development of infrastructure such as roads, bridges, and water supply systems in the rural areas. This helps in improving the standard of living of the poor people by providing them with better access to basic facilities.

2. Asset Creation: The government provides financial assistance to the poor people for the creation of assets such as houses, livestock, and agricultural land. This helps in improving the income and living conditions of the poor people.

In conclusion, the financial assistance provided by the government of India to the poor people in the country can be categorised as revenue nature expenditure and capital nature expenditure. The primary objective of the revenue nature expenditure is to provide immediate relief to the poor people, while the capital nature expenditure is aimed at creating assets that can be used for a long time.