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LATEST NEWS UPDATES | Hunger Games? Govt may Shut Down Free Ration Scheme After September -Subodh Varma

Hunger Games? Govt may Shut Down Free Ration Scheme After September -Subodh Varma

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published Published on Jul 3, 2022   modified Modified on Jul 4, 2022

-Newsclick.in

A finance ministry note has reportedly warned against too much spending on food and other subsidies.

The scheme for providing 5 kg food grain to every individual in addition to the subsidised ration given to ration card holders may be finished after September. Called the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), it was started during the first lockdown in April-May 2020 and has been extended every six months. It is reported to reach over 80 crore persons and is widely popular.

According to a report in the Economic Times, an internal note of the finance ministry's Department of Economic Affairs has argued that excessive spending has already inflated the food subsidy and fertiliser subsidy, and such measures, coupled with giving tax concessions on petrol and diesel need to be rationalised (read as cut) in order to protect "growth-supportive capital expenditure but also for avoiding fiscal slippage, warning that a higher fiscal deficit could widen the current account deficit”.

What this means is that the Modi government has started thinking about winding down spending on welfare measures motivated by the discredited theory that government spending needs to be minimised and fiscal deficit controlled so that the private sector gets ‘space’ to move forward.

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Newsclick.in, 3 July, 2022, https://www.newsclick.in/hunger-games-govt-may-shut-down-free-ration-scheme-after-september


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