Union Budget 2014: Jaitley earmarks Rs 2.51 lakh crore total subsidy for FY15

Union Budget 2014: Jaitley earmarks Rs 2.51 lakh crore total subsidy for FY15 The individual subsidy bill for each of the three items will stand at Rs 1.15 lakh crore (food), Rs 63,427 crore (petroleum) and Rs '72,970 crore (fertilizer), Jaitley said during the Budget, compared to Rs 92,000 crore, Rs 85,480 crore and Rs 67,971 crore, respectively, during FY15. 1 1 4 Google +0 0 Finance Minister Arun Jaitley earmarked Rs 2.51 lakh crore as total payments towards subsidies in the Union Budget presented today. This compares to a figure of Rs 2.45 lakh crore handed out as subsidies in FY14 and an earlier projected figure of Rs 2.46 lakh crore for FY15 by erstwhile FM P Chidambaram during the Interim Budget in February. The Indian government subsidises primarily three set of items -- food (through the public distribution or “ration” shops), fuel (both transportation and cooking) and fertilizers (for farmers, mainly urea) -- by having them sold below cost. The individual subsidy bill for each of the three items will stand at Rs 1.15 lakh crore (food), Rs 63,427 crore (petroleum) and Rs '72,970 crore (fertilizer), Jaitley said during the Budget, compared to Rs 92,000 crore, Rs 85,480 crore and Rs 67,971 crore, respectively, during FY15. In February, Chidambaram’s Interim Budget had forecast subsidies of Rs 1.15 lakh crore (food), Rs 63,427 crore (fuel) and Rs 67,970 crore (fertilizer) for the fiscal. The government’s total food subsidy bill includes Rs 25,000 crore allocated toward the Food Security Act -- an ambitious scheme that aims to eventually provide highly-subsidized food for three-fourths of the country’s population -- a pet project of the previous UPA government but which was later taken up by the NDA regime. While fuel subsidy continues to remain a battle between prevailing high international crude prices and the government’s effort to deregulate prices of some fuels such as diesel while wanting to raise prices of others. Also, any hopes that the government would raise prices of urea in order to cut the subsidy bill were put paid to recently after fertilizer minister Ananth Kumar ruled out such a move.

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