Budget Byte: What Sitharaman may have planned for subsidies in Budget

A lot of Budgetary funds get saved on subsidies in March, as off-Budget small savings replace them. It remains to be seen how it goes this year

Subsidies form a major part of central government spending. Their level has declined in the longer time frame — mostly due to lower oil prices — but the outgo has been rising in recent years on account of higher LPG subsidy. Since last few years, a considerable part of food subsidy is being managed through small savings, outside the Budget.

But unlike every year, subsidies saw a weak outflow in the initial months this year. As against front-loading, subsidy outgo was more uniform across months in FY21 to date. A lot of Budgetary funds get saved on subsidies