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A macroeconomic framework integrating growth, distribution and human development with social spending as a crucial link provides an alternative view for conceptualizing fiscal policy for India. In policy formulation, the growth potential of social spending is ignored while concerns about fiscal implications of social spending are overstated. Using a demand-side macro model incorporating necessary supply side features for the Indian economy, the growth implications of social spending is demonstrated. The social spending multiplier in India, estimated over 1990 to 2022 stands at 1.67, with implications for growth and human development following across several years. The results indicate that a combination of policies on social sector expenditure, along with policies on income redistribution are both growth-promoting and self-financing in nature.

Key Words: Human Development, Growth, Aggregate Demand, Social spending, Fiscal multiplier, Debt Sustainability, structural, policy simulation, distribution.