Uttar Pradesh Part II: government schemes & socioeconomic status

February 8, 2023


This is the second and final entry in Swaniti’s examination of the current socio-economic and government service delivery context in Uttar Pradesh. The previous paper developed an understanding of the state’s recent economic trajectory, including employment, as well as other key social development indicators and disparities between districts and for marginalized communities.

Building on that, this paper examines the policies and schemes the government is rolling out to address key areas of concern, and where there are remaining gaps in its service delivery. Overall, the government is committing substantial funding to improvements in the major issue areas: revitalizing the manufacturing sector as an electronics and semiconductor hub; improving infrastructure and incentivizing investment; providing employment skills training for youth, women, and other workers; and addressing the needs of marginalized communities, among other areas.

Since the beginning of this year alone, the available information shows improvements in many of these areas. Major national and international companies have begun establishing presences in manufacturing corridors. Mega job fairs have helped women and young people find employment. SC/ST villages have been given voting rights and revenue village designations that make them eligible for enrolment in other schemes. However, there remain apparent gaps in this service delivery, the foremost of which include regional or district-wise disparities, insufficient data collection and analysis, and a lack of accountability and grievance redressal, particularly at the village level.



Earlier this year, the government of Uttar Pradesh (GoUP) and recently reelected Chief Minister Yogi Adityanath presented their budget for 2022-23. At Rs 6.15 lakh crore, an increase from Rs 5.5 lakh crore last year, it is the state’s largest projected budget to date. Finance Minister Suresh Khanna has emphasized the government’s focus on many of the key issues we examined in the previous brief: infrastructure, employment, women and youth empowerment. By examining the schemes and policies the government plans to implement to address those areas and others – where the budgeted expenditures will go and how they will be disbursed – this paper seeks to understand where there may still be gaps in its current service delivery model.

Industrial development and infrastructure

As noted in the previous paper, one of the primary reasons for UP’s economic slowdown over the past five years was a significant contraction in manufacturing. Recognizing this, the GoUP has prioritized industrial development and investment. Updating a similar policy from 2017, the government laid out a new electronics manufacturing policy in August 2020 that focused on a five-year plan to attract international investment and transform the state into an electronics and semiconductor manufacturing hub. Building on the central government’s Production Linked Incentive scheme with a planned investment of Rs 40,000 crore, the GoUP is focusing on developing infrastructure to support three manufacturing clusters and Centers of Excellence dedicated to innovative R&D. Incentives and subsidies will be provided for companies setting up new facilities in the state, and rental facilities are being established for use by MSMEs in order to encourage startups and entrepreneurship. The GoUP is also working with the GoI to improve affordable and efficient credit and lending schemes for MSMEs in rural areas in particular, which should bolster the smaller industries that provide livelihoods for millions of people.



Overall, the GoUP has stated its new goal is to attract Rs 10 lakh crore in investments in industry and manufacturing. In June of this year, CM Adityanath held a groundbreaking ceremony to kick off construction and commercial operations on nearly 1,400 industrial projects, including data centers that will facilitate the growth of the electronics and semiconductor manufacturing sector in Noida and Greater Noida. Additionally, food and agricultural processing industries have seen increasing investment and incentivization, with Coca-Cola franchise partners and other international companies like AB Mauri setting up production and packaging facilities in the state.

While these developments should be largely beneficial for the economic future of UP, they are doing little to address regional disparities: the eastern half of the state has brought in only one-eighth of the investment that western UP has thus far.

With that said, the Department of MSME and Export Promotion has begun prioritizing the One District, One Product scheme to promote local industries in each district, including handicrafts, food processing, garment manufacturing, and other areas. The scheme will provide funding to craftsmen and entrepreneurs and aims to bolster self-employment opportunities for 500,000 currently unemployed workers per year. As part of the central government’s Cluster Development Programme, infrastructure upgrades that will further facilitate the development of MSMEs have been targeted in several districts. So far this year, UP has received Rs 7 crore from the GoI to facilitate the growth of various industries, and has already succeeded in spending Rs 6 crore on the same. MSMEs are also being targeted by CBFTE, ZED, and Lean schemes which will help newer enterprises with funding, registration, and certification along with increasing their competitiveness within global supply chains.


Additional infrastructure projects included in the new budget include the construction of new medical colleges across the state; improvements to rural health infrastructure, including the creation of new super specialty hospitals in border areas and health and wellness centers in both urban and rural areas; and the Babuji Kalyan Singh Gram Unnati Yojana scheme, which will fund village development projects including solar street light installation. UP has dedicated 6.4% of its total expenditures for 2022-23 to the construction and maintenance of roads and bridges, which is significantly higher than the state average of 4.7% and demonstrates the government’s commitment to improving infrastructure. Within this allocation, CM Adityanath has promised state funding for improving roads in tribal villages, along with drainage, and power, and water systems.


The employment crisis that has been playing out nationwide over the last several years has taken a much more significant toll on workers in UP even before the pandemic shocked the global economy. As such, employment generation must be one of the main priorities of the GoUP going forward, particularly for women and young people. The emphasis on manufacturing and infrastructure development noted above has the potential for huge gains in job opportunities; the question will be whether there are sufficient welltrained workers able to fill those opportunities. In recent years, the efficacy of job skills training programmes at Industrial Training Institutes has been questioned by experts because skill development does not automatically make individuals employable. Programme participants have often received training for jobs there is no local demand for, which fails to boost the economy or the employment rate and feeds into the cycle of migration discussed in the previous paper. That said, now that the GoUP has begun making progress in driving manufacturing and industrial investment, it has the opportunity to develop skills training programmes that match the local demand.


On a wider scale, the GoUP has recently pledged to provide at least one employment opportunity for every farming family by 2027, along with training programmes for at least 210,000 farmers and entrepreneurs. As part of this initiative, called Mission Rojgar, the government has held “mega job fairs” in both urban and rural areas around the state to facilitate communication between employers and potential employees. Focusing primarily on youth workers, the fairs have attracted more than 300 companies and aim to provide more than 26,000 jobs. Furthermore, the GoUP’s efforts at job creation under the Prime Minister’s Employment Generation Programme (PMEGP) – an initiative launched by the GoI to provide job opportunities to unemployed youth and incentivize entrepreneurship – have been highly successful so far this year. In Q1 of the 2022-23 financial year, the state exceeded expectations by providing 16,257 jobs, amounting to 108% the total number of jobs expected by the end of Q2. For educated youth who are still struggling to find steady employment, the Berojgarj Bhatta scheme has dedicated funding to provide unemployment payments during their job search.

Entrepreneurship among youth is also being promoted through the UP Startup Policy of 2020, which aims to help young people launch 10,000 startups over five years while establishing 100 incubators that will help provide training, mentorship, and networking opportunities. Likewise, the SAMARTH scheme was established in March to encourage entrepreneurship among women by reserving 20% of openings at all skill development programs and job fairs, while the NSSH scheme has been designed to help entrepreneurs from Scheduled Castes and Tribes by increasing government procurement and mainstreaming economic activities. The GoUP’s new budget has also dedicated Rs 20 crore to Mission Shakti, which provides women with skill development programmes.



Lastly, alongside the new goal of one job for every farmer family by 2027, rural employment and income generation has been targeted. There are new plans to establish 375 large food processing units as well as the more than 41,000 units to be established or upgraded as part of the Pradhan Mantri Formalisation of Micro-food Processing Enterprises scheme. The GoUP has also begun working to bolster market linkages and trainings for farmers and entrepreneurs in the food processing industry.

Under the MGNREGA rural employment scheme, the GoUP was able to create 26 crore man-days last year and is targeting 32 crore for 2022-23. However, the number of workers covered under MGNREGA in UP has consistently been below required levels and many of those who were employed under the scheme have continued to face delayed payments or non-payment of wages over the past few years. Furthermore, rural areas with higher demand for employment under the scheme received fewer man-days than areas with lower demand, like those areas closer to Delhi.

Women and SC households have fared the worst under the scheme since 2016-17 in particular. And payments to workers under MGNREGA in UP are lower than in any other state. There is still much work to be done in this area for rural and marginalized communities. With that said, the GoUP has set other targets of 16,000 new employment opportunities in 800 new government units in rural areas, along with more than 7,500 jobs in education and 10,000 new nursing jobs over the next several years. Finally, the GoUP has established a scheme to improve income generation for forest-dwelling communities and Scheduled Tribes. Along with other employment guarantee projects, this has funded the purchase and installation of leaf-pressing machines and training programs for women in the villages who are able to press leaves into plates for sale, and initiatives focused on processing and sale of local produce.


Social welfare programmes & empowerment schemes

Among the numerous other schemes introduced or continued within the 2022-23 budget – a total of 97 schemes have been earmarked for funding – a total of Rs 39,000 crore have been set aside for social welfare schemes. Among the most prominent schemes include the Pradhan Mantri Ujjwala Yojana, providing free LPG cylinders, and the Jal Jeevan Mission under the central government, which will provide drinking water in the areas where it is most scarce.

The GoUP will also spend Rs 1,500 crore on the Swami Vivekananda Youth Empowerment Scheme which has distributed 1.2 million smartphones and computer tablets out of a planned 20 million over five years. Other schemes dedicated to youth empowerment will provide competitive exam coaching and funding for purchase of books and materials for young lawyers in their first three years of work.

Empowerment schemes for women – again under the Mission Shakti mentioned above – are receiving Rs 72 crore in the current budget. These include a proposal for district-level cyber helpdesks, sensitisation of law enforcement on handling crimes against women, distribution of free rations, and doubling the pensions of three million widows, among other areas. The families of nearly 150,000 girls have been enrolled in the Mukhyamantri Kanya Sumangala Yojana scheme, which provides welfare payments to help provide for the health, well-being, and education of girls. In conjunction with the central government, the GoUP plans to implement schemes dedicated to enhancing and funding SHGs and establishing supplementary nutrition manufacturing units.

Finally, the government has been expanding programs for marginalized communities, including SC/ST villages, in part by granting many of them the status of revenue villages. This designation enables the villages and those living in them to enrol in and receive benefits from government schemes where they were previously ineligible.


CM Adityanath has promised the distribution of land patta, improvement of education systems, provision of BPL cards, pensions, and loans among other services and benefits.


With the largest budget in state history and nearly one hundred schemes being implemented currently, UP should be able to provide for its citizens most in need of support from their government, whether that is in the form of employment opportunities, improvements in infrastructure, or pension payments. The schemes and programmes detailed above show that the GoUP has its overall priorities correct and is targeting the big issues that are affecting the most people, while trying to ensure that marginalized communities are not being further left behind. The bigger question now is whether priorities will be turned into impact and where there are still gaps to be filled.

Employment training programs

One major issue that will continue to affect economic growth and employment is ensuring a match between employee skills and employment requirements and between demand for and supply of jobs. Ongoing migration despite job guarantees by the GoUP and MGNREGA demonstrates, in part, that there is greater demand for jobs than there are opportunities. Many of the jobs that are found are underpaid or in tenuous conditions. Incentivizing investment and the establishment of manufacturing hubs should prove to be an effective means of stimulating the economy and employment numbers, but only if there are enough workers who are well trained on the right skills. As new major companies set up in UP, they may very likely find an emerging gap between their needs and the skills of the majority of the workforce because of government-funded training programmes that have not been kept up to date with changing technologies and working conditions or that were based on the industries the government expected to have coming into the state rather than the ones that actually did.



In creating, contextualizing, and implementing training programmes for workers, the government must be able to move nimbly and quickly, adapting to the needs of the market and the companies it has brought into the state. If it does not, the money and time spent on training programs by all parties will go to waste. That said, the GoUP must make sure there are enough resources dedicated to the training programmes, partnering with companies as soon as they begin establishing operations in the state to understand what skills their workforce will need and how to train for them. The gaps created by a broadbrush approach to skills training need to be eliminated to find lasting success in employment programmes.More specific and rigorously measured indicators are also needed to determine whether these programmes are successful or how they should be improved. In recent years, researchers have come across many instances where data on job demand and other outcomes is not being properly recorded; the gaps this causes in effective programme creation and implementation can be substantial. Whether this type of data collection and M&E requires more manpower or funding or both, it is crucial to the success of these initiatives and should be made mandatory.

Data collection and analysis on entrepreneur success and startup culture Another area that should be examined is in how much weight and emphasis is given to entrepreneurship and creating a startup culture as compared to further establishing a more robust manufacturing sector and incentivizing larger companies to invest in the state. Again, more robust data and research should be done on how viable most startups are as companies and as longterm sources of income and economic activity. Entrepreneurship and startup culture are ideas that carry a great deal of culture cache and generate buzz in the media as everyone searches for the next unicorn. And MSMEs do carry a lot of weight in UP’s economy, but there may come a point of market oversaturation. This begs the question of whether there is enough robust data to support schemes dedicated to creating 10,000 new startups in five years rather than putting more resources elsewhere.


It seems there may be gaps in understanding, for example, how many startups created on the back of government schemes have become successful enterprises with the lasting potential to employ more people versus how many have folded over the same period. An overemphasis on entrepreneurship could hurt employment numbers more than it helps, but without proper data, it’s difficult to effectively allocate the resources.

Other areas of concern

The numbers detailed above surrounding MGNREGA and rural employment overall demonstrate an area that needs to be revitalized. UP has higher numbers of rural poor than anywhere else in the country but a lower percentage of people actually working as part of these schemes. Unfortunately, MGNREGA payment issues are not unique to UP, as protests have demonstrated over the past several months, but the GoUP must be able to cover the gaps this creates. While CM Adityanath’s promise of one job per family in five years’ time looks admirable on paper, it remains to be seen what form that employment takes and how financially beneficial it is to the families.

More needs to be done to address regional disparities as well: new industrial investment has skewed heavily to western areas as have the number of MGNREGA man-hours. Part of the issue here appears to be a gap in accountability mechanisms. In rural areas or poorer districts, there is “no demand for public accountability for poor delivery of services,” whether because they are not aware of the services and schemes they are entitled to or there is no easy way to lodge a grievance. One way of addressing this, which Swaniti has helped implement in other areas, is to use digital tools such as a smartphone app that allows citizens to submit feedback or grievances directly to their government officials, which can then be collected and processed in real time.


Related to the issue of ensuring accountability are the ongoing disparities between different districts and communities. As noted previously, eastern areas of the state have received just one-eighth of the private sector investment that western areas have, and rural areas perform worst on almost all key indicators. Furthermore, “caste and community affiliations often come into play while giving jobs under MGNREGA or expediting work under the Pradhan Mantri Awas Yojana, a housing scheme for the poor.” Officials at every level should be held accountable for emphasizing equitable distribution for beneficiaries.

Lastly, there are gaps in the sustainable impact of some schemes which significantly hampers their ability to change socioeconomic outcomes for beneficiaries. Toilets built for rural families and communities under the Swachh Bharat scheme have ended up being used for storage of wood or livestock feed, while others have remained locked to the public or have lacked water connections. Likewise, the two free LPG gas cylinders distributed to families under the Ujjwala scheme are cost-prohibitive in the long run as many villages cannot afford to refill them, going back to wood fires for cooking instead. This is again an area where there appears to be a gap in either or both the data collection required to analyze the full impact of schemes and the accountability required to make changes to highly-touted schemes that may not be as effective as officials would have hoped or expected.


The GoUP has stated its goal of turning the state into a $1 billion economy in the coming years. Additionally, the BJP has touted the “double engine” of progress when combining party leadership of the GoI and the GoUP. There is some credibility to both assertions. While it would require a substantial increase in the annual growth rate of the state economy, reaching that goal is not out of the question over the next decade.


Likewise, UP has seen a nearly 50% increase in central government spending in the state in 2017-22 compared to 2012-17. Subsequently, UP has become the highest-performing state in effective implementation of central government schemes, according to the GoUP.

However, gaps remain in overall service delivery and in effective, equitable service delivery. In some instances, these gaps seem to arise from inadequate data collection or analysis, preventing officials from gaining a workable understanding of how robust an impact certain schemes have or whether that impact is a foundation that can be built on for future development or a temporary benefit that sees beneficiaries back where they started after a certain amount of time, as in the case of the LPG cylinders. In other cases, there is a lack of accountability and communication between beneficiaries and officials, either because of a lack of awareness or options for submitting and hearing grievances.

Ensuring such thorough and ongoing data collection and analysis will require a substantial number of hours and staffing. Ensuring accountability requires a mechanism for grievance submission and redressal, such as the smartphone app mentioned above. More importantly, however, accountability requires a willingness among government officials to hear the concerns of their constituents and to make changes to schemes they have worked hard to craft and implement.

While this is not an exhaustive list of service delivery gaps, UP – meaning the government, the people, and the economy – will benefit greatly from a more robust focus on both areas.Overall, UP arguably has as much potential for making significant gains socially and economically.


It has a state government that has shown its ability to focus on addressing the biggest issues facing the state now and going forward. It has crucial support from the central government. And it has the improving infrastructure and the large, young, ready-to-work population that could drive growth and development for years to come. If the government can fill some of the lingering gaps in its service delivery, the state’s full potential may indeed be met in the years to come.

DISCLAIMER: The opinions expressed herein are entirely those of the author(s). Swaniti makes every effort to use reliable and comprehensive information, but Swaniti does not represent that the contents of the report are accurate or complete. Swaniti is a nonprofit, non-partisan group. This document has been prepared without regard to the objectives or opinions of those who may receive it.