Finances 2024: India could allot Rs 4 lakh crore for subsequent yr’s meals, fertiliser subsidies

Meals and fertiliser subsidies account for about one-ninth of India’s complete price range spending of 45 trillion rupees through the present fiscal yr that ends on March 31.

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The Ministry of Client Affairs, Meals and Public Distribution has estimated subsequent yr’s meals subsidy invoice at 2.2 trillion rupees ($26.52 billion), the 2 sources stated. That’s 10% greater than a projected outlay of almost 2 trillion rupees ($24.11 billion) for the present 2023-24 fiscal yr.
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Moreover, subsequent fiscal yr’s fertiliser subsidy is anticipated to be 1.75 trillion rupees ($21.10 billion), down from the present 2022-23 fiscal yr estimate of almost 2 trillion rupees, one of many sources stated. The sources, that are immediately concerned within the choice making on the subsidies, didn’t want to be named as they weren’t authorised to talk to the media. Finance Minister Nirmala Sitharaman will unveil the 2024/25 price range on Feb. 1.

The Ministry of Finance, the Ministry of Chemical substances and Fertilizers and the Ministry of Client Affairs, Meals and Public Distribution ministries of finance didn’t reply to requests for remark.

Sustaining the mixed subsidies at their present degree can be uncommon for a authorities going through a nationwide election in only a few months, however Prime Minister Narendra Modi is extensively anticipated to win a uncommon third time period in elections scheduled for April and Might.

Additionally, containing meals and fertiliser subsidies is essential for managing India’s fiscal deficit, which Modi’s authorities is focusing on at 5.9% of gross home product this yr and planning to decrease by at the least 50 foundation factors within the fiscal yr 2024/25.

The meals subsidy invoice is more likely to go up subsequent yr as Modi’s administration late final yr prolonged its flagship free meals welfare programme for the subsequent 5 years.

India runs its multi-billion greenback meals welfare programme, the world’s largest such initiative, by shopping for rice and wheat from tens of millions of home farmers at state-set minimal or assured costs after which supplying the staples at no cost to 800 million Indians.