Widening the Gap: How underfunding ends up reinforcing existing social andeconomic inequalities.

The Indian Constitution embodies justice, equality and dignity as its foundational and fundamental ideals, with a vision of a just social order for everyone. In support of that vision, directs that there must be a system of free legal aid and there must be removal of socioeconomic barriers to justice. Yet, this remains unrealized because the legal aid system is chronically underfunded. The Supreme Court, in Hussainara Khatoon v. State of Bihar, (1979), held that free legal aid as well as speedy trials are part of Article 21, and noted that poverty should not be a reason to deny someone access to justice. Nevertheless, the legal aid machinery, with the assistance of the National Legal Services Authority (NALSA), remains under-resourced, thereby hindering access to the justice system for marginalized communities, including Dalit, women, migrant workers and transgender persons. The chronic under funding of legal aid does not only create barriers to justice through legal aid, it entrenches injustices more broadly and furthers the cycles of poverty and inequality in our society.

The Mandate and the Reality

Reflection of Article 39A of the Constitution of India states that the State shall ensure free legal aid is provided so that justice is not denied to any citizen by reason of economic or social disadvantage. The Legal Services Authorities Act, 1987 has given this directive an institutional form and has set up the National Legal Services Authority, the State Legal Services Authorities and District Legal Services Authorities to ensure provision of legal assistance, conduct of legal awareness activities, Lok Adalats, and so on. However, the legal aid machinery on the ground is strapped for resources.

Under various schemes of NALSA, more than 44.22 lakh persons in India were conferred with free legal aid and advisory services in 2022-23 and 2024-25. During the period, more than 23.58 crore cases were disposed of in Lok Adalats. In awareness programmes, more than 13.83 lakh awareness programme is conducted, reaching almost 15 crores of persons.

However, this outreach is not very significant if the demand is to be taken into account. Almost 80% of the population of India can be beneficiaries of legal aid based on the eligibility criteria of income, sex, caste, marginalization etc. as per the provisions of the Legal Services Authorities Act. The figures as given in NALSA’s statistics portal reflect thus the challenges posed in scaling of Legal Services so as to meet the huge population of India and high percentage of disadvantaged persons.

Allocation of Budgets: Justice system vs. Legal Aid

According to the India Justice Report (Budget Study 2025), the average share of legal aid within the total justice budget is merely 0.49% for fiscal 2024-25 (BE), for 11 major states in India.  In 2022-2023, national per capita legal aid expenditure rose to the extent of ₹7, while in Haryana, the per target person expenditure was ₹16 whereas the completed expenditure in relation to Bihar and West Bengal was less. 

The budget estimate for 2024-25 provides for increasing this per target person expenditure to ₹10 or so, but still a good deal less than the estimated per capita expenditure on other branches of the justice system, which are about ₹353 for the judiciary anThis shows that legal aid expenditure, even as computed in relation to the eligible population for legal aid, is on a lower scale than other components of the justice system which are vital for the access to justice for vulnerable sections. 

Capacity, Outreach & Staffing Gaps

One critical obstacle is the limited human resource base. As of March 2022, India had approximately 50,394 panel advocates (district & high court) under legal services authorities, which gives an average of one legal aid lawyer per 18,609 people (or ~5 per. Many districts have inadequate lawyers available to serve remote rural areas, and many panel advocates carry high caseloads for low honoraria.

Legal Services Clinics (institutionalized under NALSA Regulations, 2011) are designed to provide access points for grassroots advice, document preparation, and legal literacy. However, their numbers, funding, and staffing are inadequate in many districts.

Paralegal Volunteers (PLVs) are critical to overcoming the gap between courts and communities, particularly in rural areas. Nevertheless, recent reports signal steep drops in the number of volunteers across states; a count that heightens the invisibility of legal aid in remote areas.

State-Level Disparities: The Impact of Underfunding on Inequality

State-level underfunding does not impact all states equally because states vary in their administrative capacity, political prioritization, and associated revenue base of funding. Some states are doing better, while many are doing significantly worse.

Of the high GSDP states examined in the India Justice Report, overall justice allocations have increased although, in general, legal aid funding continues to fall within very small cost shares. In states like Uttar Pradesh, while total allocations for legal aid are high (Rs. 211.83 crore BE 2024-25 in the group of 11 states referenced), per capita effectiveness and outreach remain poor.

In Gujarat, legal aid funding is at ₹93.15 crore for 2024-25, which is relatively high among the legal aid states of interest, but the use of those funds in prior years was very poor, especially below 55%. States already disadvantaged on social metrics such as poorer, rural, tribal‐majority areas are also states where legal aid machinery is the weakest. Thus, under-funding is continuing to scale up spatial inequalities already existing in the society.

Education & Healthcare: Similar Patterns of Under-funding

By including education and health in the issue of underfunding legal aid, we see a common thread of chronic underinvestment in these vital public services. Just as the education and health sectors are reduced in investment, infrastructure and staff, so is legal aid, whose absence of institutional support has a sharper impact on marginalized communities. This shows how systemic underinvestment in those services fundamental to equality means failure in access to rights and justice. 

Using UNESCO figures and Ministry of Education (India), spending on education in India by the Government (both central and state) has averaged about 3.5% to 4.5% GDP in recent years, and is far below the 6% goal that has been a prominent part of policy dialogue for decades.

Because there is little level of funding, states must instead prioritize their spending. Schools in rural, remote areas, or tardy in political priority, are more likely to be the shortest of the short sticks. Teacher shortages, crumbling infrastructure, lack of learning resources, and lack of digital access disproportionately affect children from marginalized backgrounds in states such as Madhya Pradesh, Bihar, Rajasthan, and others.

Despite official policy favoring universal access to schools, restricted funding requires states to prioritize spending. As a result, rural areas and disadvantaged groups suffer from inadequate infrastructure, teacher shortages, and limited supplies. This creates a situation where privileged groups are able to obtain quality education, while disadvantaged children must settle for inferior options. These inequalities reinforce the uneven access to rights and justice, as is documented by numerous investigations which indicate an enduring rural and urban and social inequality in the Indian education system.

Healthcare

India's health expenditure (public & private) as a percentage of GDP is low, with public expenditure being even lower.  Although state budget increases in health have been publicized, many rural and primary health centers, which serve the majority of the population in places like Uttar Pradesh, Bihar, Odisha, and Jharkhand, continue to be severely under-resourced. There are chronic and persistent shortages of doctors, paramedical staff, medicines, and healthcare infrastructure.

These gaps are glaring in times of crisis such as the COVID-19 pandemic.. Poor communities were particularly devastated by concerns about not having adequate hospital beds, adequate oxygen, or even basic care (NHM dashboard). Many poor households are forced into either debt or no care because of high medical out-of-pocket expenses. Those households that can afford private healthcare are able to mitigate this burden, which generates a cycle of illness and poverty.

Mechanisms by Which Under-funding Perpetuates Inequality

The data examined and state patterns indicate important mechanisms for which under funding exacerbates existing inequalities:

1. Access as Premium: When legal aid, education, or health care is underfunded, access becomes a function of ability to pay, or how to navigate processes. Marginalized groups do not simply lag behind because the law or rule does not give them, but ultimately because the resources do not come to them.

2.  Double Disadvantage in Poor Areas: The States or Districts with less revenue and weaker rules of governance are also the same that have the greatest disadvantages socially. This aggravation of inequities for rural, tribal and remote areas is continued by means of under funding.

3. Disparity of an Initial Condition:  Under funding of the educational and the health systems causes children of economically unendowed origin to begin life with deficiencies in learning and, to a lesser extent, in health, thus creating additional structural difficulties in ever getting a levelly played game.

4.Deferred Justice & Economic Waste: Claims in law regarding land, labor, wage and benefits become lost through failure to take care of in a timely manner, which means loss of economic opportunity. Under funding increases the time required to adjust for the poor while the underprivileged class likely are able to pay.

5. Erosion of Trust & Disillusionment of Institutions: This undermining of trust in public systems causes men and women to search elsewhere for solutions for their unmet needs, working informal arrangements with local brokers of power, utilizing means which are extra-legal, thus promoting further inequity and injustice.

Closing the Gap of Inequality: Policy Solutions for Inclusive Growth in India

1.      Increased Public Investment:  Increase investment in legal aid, education (6% of GDP), and health (2.5% - 3%), financed by taxing wealth and luxury.

2.      Accountability: Streamline funding rules, improve reporting, and modify the accounting/social accounting for service delivery.

3.      Develop Human Capital: Create networks, awards, and recognition for legal aid lawyers, paralegals, and community service providers.

4.      Focus into Marginalized Areas: Special funding, incentives, and mobile outreach to tribes, rural, and underdeveloped areas.

5.      Innovation and Integration: Develop more digital platforms and integrate legal aid into education, health, and welfare.

Conclusion

Underfunding is not mere neglect. It is a systemic magnifier of inequality. In India today, many citizens are denied justice, quality education and simple healthcare capabilities, not because they lack legal entitlement, but for lack of money to effectuate the entitlement. Data from NALSA, the India Justice Report, and education and health indicators all present a nearly indefensible case: many marginalized populations, long disadvantaged socially and economically, also face compounded disadvantage through institutional disadvantages.

Unless India regards public services specifically justice, education, and health as social investments instead of discretionary costs, gap between the economically privileged and the marginalized will only dramatically increase in the future. A viable path ahead encompassed political will, a determination to budget, institutional restructuring, and a reconceptualization of development into equitable and inclusive.