Will the scheme of free ration be closed after September? Finance Ministry warns about increasing expenditure

Finance Ministry warns on increasing expenditure

According to the Finance Ministry, due to the increase in the deadline of the scheme of free food grains, increase in fertilizer subsidy and cut in the duty of petrol and diesel, the pressure on the government’s financial position has increased significantly.

The part of the Prime Minister’s Garib Kalyan Anna Yojana has been very important in ensuring two-time food to crores of people of the country during the Corona period. although now Finance Ministry ,Finance Ministry) is warning the government about the increasing expenditure of this scheme. According to the Ministry of Finance, the expenditure on the scheme by the government has reached its limits and after September the free food (PMGKAY) There is no longer room for planning or any other big tax exemption. The government has extended this scheme till September. Due to which an increase of 80 thousand crore rupees is expected in food subsidy. At the same time, due to reduction of tax on oil recently, there has been a loss of one lakh crore rupees in the income of the government. For this reason, the Finance Ministry has warned the government that after September there is no room left for any relaxation in the exchequer. The Department of Expenditure of the Ministry of Finance has warned that if the government takes any such decision, its consequences will be serious and the government’s fiscal deficit may become uncontrollable.

increased spending burden on the government

The government had made a provision of Rs 2.07 lakh crore for food subsidy in the current financial year 2022-23. Till the time of the proposal, the scheme of free food was only till 31st March. Later the government extended the scheme till September 2023. With this it is estimated that the food subsidy bill of the government can increase by Rs 80 thousand crore. According to estimates, if the government extends the scheme for another 6 months, then the expenditure can increase to about Rs 3.7 lakh crore. According to the Economic Times report, it has been said in an internal note that any further subsidies or tax cuts can spoil the mathematics of income expenditure of the government. The Department of Expenditure has said that whether it is food security or the condition of the treasury, under no circumstances it can be advised to extend the PMGKAY scheme beyond September.

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Many steps of relief increased the burden

According to the note of the Department of Expenditure, several relief measures have been taken recently such as increase in the deadline of the scheme of free food grains, increase in fertilizer subsidy, announcement of subsidy in cooking gas again, reduction in excise duty of petrol and diesel and food grains. With the reduction in custom duty in oil, several other steps have increased the pressure on the financial situation. On the basis of sources only yesterday, the news has come that the government is now facing difficulties in reducing the fiscal deficit and it is now becoming difficult to achieve the deficit target. In such a situation, the effort is now that the country’s fiscal deficit cannot exceed the level of last year.