New Delhi: In the Union Budget 2018-19, presented in Lok Sabha on Thursday, Finance Minister Arun Jaitley proposed a 15 per cent higher subsidies at Rs 2.64 lakh crore on food, fertilisers and petroleum products. The subsidy for the fiscal year 2018-19 on food, petroleum and fertilisers is estimated at Rs 2,64,335.65 crore in the last full budget presented by Mr Jaitley before the 2019 general elections.
As per the Revised Budget Estimates, the subsidy on these three categories has been pegged at Rs 2,29,715.67 crore for the ongoing fiscal year.
A sum of Rs 1,69,323 crore has been allocated towards food subsidy for 2018-19, as against Rs 1,40,281.69 crore in the Revised Estimate of the current fiscal year.
The fertiliser subsidy has been raised to Rs 70,079.85 crore for 2018-19, compared with Revised Estimate of Rs 64,973.5 crore in the current financial year.
Under fertilisers, the government has set aside Rs 44,989.5 crore in the next fiscal year for the urea sector, as against Rs 42,721.7 crore allocation in this fiscal.
The outlay on phosphatic and potassic (P&K) fertilisers under the Nutrient Based Subsidy Scheme has been increased to Rs 25,090.35 crore in the next fiscal year, up from Rs 22,251.8 crore in the current year.
The petroleum subsidy has been hiked to Rs 24,932.8 crore for 2018-19, which is up from estimated the Rs 24,460.48 crore outlay for this fiscal year. Of the allocation for the next fiscal, that for Liquified Petroleum Gas is at 20,377.80 crore and for kerosene the subsidy bill is Rs 4,555 crore.
For 2017-18, LPG and kerosene subsidies have been pegged at Rs 15,656.33 crore and Rs 8,804.15 crore respectively.
Mr Jaitley's focus has been on rural India and agriculture, perhaps with an eye on electoral gains for the ruling party at the Centre next year.
For the Kharif agricultural output, the Minister increased the minimum support price to one-and-a-half times the production cost, raising institutional farm credit to Rs 11 lakh crore in 2018-19 from Rs 8.5 lakh crore.
He also made a significant announcement of fiscal slippage with implications for pushing inflation, revising upwards the government's fiscal deficit target for 2017-18 to 3.5 per cent of the GDP, or the equivalent of Rs 5.95 lakh crore. The higher target came in place of the 3.2 per cent for the current fiscal announced earlier.
Mr Jaitley further projected a fiscal deficit of 3.3 per cent of GDP for the coming financial year.
Meanwhile, official data later on Thursday showed the Centre's fiscal deficit for the first nine months of 2017-18 stood at 113.6 per cent -- Rs 6.20 lakh crore -- of the full year's target of Rs 5.46 lakh crore.