In the coming union budget, the food subsidy may be hiked. It is expected that the food subsidy may rise to 20% in the union budget. Earlier in the interim budget, it was stepped up to Rs 1.84 lakh crore for the current financial year.
A 20% rise will add over Rs 36,000 crore to the subsidy bill, currently pegged at Rs 1.84 lakh crore, and take the total to Rs 2.21 lakh crore. In the 2018-19, the subsidy was Rs 1.71 lakh crore.
While the subsidy towards the FCI and the decentralised food procurement is set to be increased in the budget, some small rise is also expected to come up towards sugar subsidy under the public distribution system (PDS).
Food subsidy for the FCI has pegged at Rs 1.51 lakh crore, decentralised grain procurement at Rs 33,000 crore and the sugar sector at Rs 220 crore in the interim budget.
There is also a provision of providing ‘ways and means advances’ (WMA) — temporary loan facility — to the FCI. Earlier, the FCI has given Rs 50,000 crore under the WMA, which has already been repaid by the corporation.
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