The country's spending on social programmes, aimed at helping the poor, is likely to increase hugely. Problem is, can India afford it? India has appointed several socialist intellectuals and activists to a powerful government policy advisory body, officials said on Monday, signalling the possibility of higher spending on costly social programmes.

The National Advisory Council (NAC) is headed by Sonia Gandhi, powerful chief of the ruling Congress party who is seen as more inclined toward favouring the predominantly rural poor to help boost the party ahead of some key state elections.

While higher spending may be cushioned by windfall gains from a recent auction of telecom spectrum, the risk is it could fuel rural demand, feeding inflation, already high, and increasing the pressure on the central bank to raise rates aggressively.

The NAC, formed in 2004, initiated social programmes credited with helping return the Congress party to power last year. The council has cleared 11 names, including a left leaning economist, social and human rights activists and former civil servants.

They will try to advocate left-liberal policies. The appointments show that the Congress is still in favour of a socialist policy as opposed to a capitalist line, said political analyst Amulya Ganguli.