An autonomous research institute under the Ministry of Finance


Financing Human Development in Karnataka

Publication date

Jul, 2004


Report submitted to the UNDP and Government of Karnataka


M. Govinda Rao, Mita Choudhury


This paper analysed the problems of state finances in Karnataka and the constraints posed on financing human development in the state. The analysis shows that adequate allocation to human development expenditures in the 1990s has been seriously constrained by the steadily deteriorating fiscal health of the state. Although a high growth rate in the state has led to an increase in per capita expenditures in the social sector and human priority areas, there has been a decline in social allocation and human priority ratios in the state in the 1990s. The declining trend in these ratios has posed a challenge to achieving the millennium development goals and targets set out for the Tenth plan. Expenditures by local government in the state have also been segmented, inadequate, and unequally distributed. Although Karnataka is likely to meet certain human development targets in the Tenth plan in urban areas, public expenditure needs to be focused towards rural areas, in particular towards the backward districts of the state where human development indicators are far below the targets.

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