Subsidies on food, fertiliser and petroleum have been pegged higher by over 3 per cent to more than Rs 2.4 lakh crore for 2017-18. The subsidy bill on food, petroleum and fertilisers is estimated at Rs 2,40,338.6 crore for 2017-18 fiscal, according to the Budget proposals presented by Finance Minister Arun Jaitley in Parliament. The subsidy bill is seen at Rs 2,32,704.68 crore for 2016-17 financial year, as per the revised Budget estimates.
The government has earmarked Rs 1,45,338.60 crore for food subsidy in the next fiscal as against Rs 1,35,172.96 crore in the revised estimate of this fiscal. Food subsidy bill is expected to be higher next fiscal as the National Food Security Act, under which the government provides highly subsidised foodgrains to over 80 crore people, has been rolled out across the country from November 2016.
Fertiliser subsidy has been kept unchanged at Rs 70,000 crore for 2017-18 fiscal, even as the domestic industry was demanding higher allocation to clear subsidy arrears of about Rs 35,000 crore. In fertiliser subsidy, the government has allocated Rs 49,768 crore for urea and Rs 20,232 crore for decontrolled phosphoric and potassic (P&K) fertilisers.
Petroleum subsidy has been reduced to Rs 25,000 crore for 2017-18 from estimated Rs 27,531.71 crore in this fiscal. Of Rs 25,000 crore for next fiscal, Rs 16,076.13 crore has been earmarked for LPG subsidy and the rest is for kerosene.