Interim Budget 2014: Subsidy bill pegged marginally higher at Rs 2.5 lakh crore
As government seeks to roll out the food law, Finance Minister P Chidambaram today sought to raise total subsidies on fuel, food and fertilisers marginally to over Rs 2.46 lakh crore in the 2014-15 fiscal.
The government has increased the food subsidy by a whopping Rs 23,000 crore to Rs 1,15,000 crore for 2014-15 fiscal mainly for implementation of the National Food Security law.
According to the interim Budget proposals, subsidy bill on food, petroleum and fertilisers is estimated at Rs 2,46,397 crore for 2014-15 fiscal against Rs 2,45,452 crore in the revised estimates for this fiscal.
Interestingly, the revised estimates for this fiscal are higher by 11 per cent compared to the budget estimate of Rs 2,20,971.50 crore.
"Non-plan expenditure in 2014-15 is estimated at Rs 12,07,892 crore. Of this, the expenditure on subsidies for food, fertiliser and fuel will be Rs 2,46,397 crore. This is slightly more than the revised estimate of Rs 2,45,452 crore in 2013-14.," Chidambaram said while unveiling the Interim Budget 2014-15 proposals in the Lok Sabha.
As much as Rs 65,000 crore has been allocated for fuel subsidy, he added.
"We have this year (2013-14) absorbed the rollover of Rs 45,000 crore from the fourth quarter of 2012-13 (fiscal) and we will rollover only Rs 35,000 crore from the fourth quarter of this year into the next year," the Minister said.
On the Food Security Act, Chidambaram said, "Rs 1,15,000 crore has been allocated for food subsidy keeping in mind the government's firm and irrevocable commitment to implement the National Food Security Act throughout the country."
The oil subsidies, given to state-run oil marketing firms like IOC, BPCL and HPCL for selling diesel, domestic LPG to households and kerosene through the PDS system, below cost, is estimated lower.
It is pegged at Rs 63,426.95 crore for 2014-15 fiscal against a revised estimate (RE) of Rs 85,480 crore in 2013-14 fiscal, the budget document said.
"Decrease is due to less requirement under compensation to oil companies' under recoveries on account of sale of petroleum products," it added.
The food subsidy given to run the public distribution system is estimated to rise to Rs 1.15 lakh crore next fiscal from the RE of Rs 92,000 crore in 2013-14.
Food subsidy seeks to meet the difference between the economic cost of food grains and their sales realisation at the Central Issue Price fixed under the public distribution system (PDS) and other welfare schemes.
Out of Rs 1.15 lakh crore on food subsidy, the government has provided Rs 88,500 crore for the Food law.
Of the total fertiliser subsidy of Rs 67,970 crore in 2014-15 fiscal, subsidy for imported urea is pegged at Rs 12,300 crore, domestic urea is Rs 31,000 crore and sale of de-controlled fertilisers (like phosphatic & potassic fertilisers) is Rs 24,670 crore.
