Union Budget provides less for food and fertiliser subsidies

The food and fertiliser subsidies saw a big reduction in 2022-23 (FY23), compared to their Revised Estimates (RE) of 2021-22 (FY22), which indicates a likely discontinuation of the free food programme in the next fiscal year unless there is a fresh Covid shock and some easing of international fertiliser prices, according to the government’s assessment. 

The Budget Estimates of food subsidy in FY23 has been pegged at Rs 2.06 trillion, which is 25 per cent less than the RE of FY22, while fertiliser subsidy is pegged at Rs 1.05 trillion, which is 28 per cent less than the RE of FY22. 

The petroleum subsidy is pegged at Rs 5,813 crore, which is 11 per cent less. Interestingly, in case of food, the RE of subsidy for FY22 pegged at Rs 2.86 trillion in the Budget is lower than the requirement of Rs 3.9 trillion as laid down by the food ministry due to the continuation of the Pradhan Mantri Garib Kalyan Anna Yojana from May 2021.