India spends more than 3% of GDP on govt pensions, states' burden growing

Centre last week proposed new policy for its staff to manage costs

The Centre and states spent about Rs 9.6 trillion on the pensions of their employees in FY24 (revised estimates), accounting for 3.3 per cent of India’s gross domestic product (GDP).

The proportion peaked at 3.8 per cent in the pandemic year of FY21 and trimmed to 3.3-3.4 per cent later. The average spending was 3.3 per cent in the decade beginning FY15.

With their combined outgo topping Rs 5 trillion for the first time in FY24, the pension bill of states exceeded that of the Centre by more than Rs 82,000 crore. States’ spending was higher than