The government does not see “much fiscal impact” from the just announced five-year extension of the food grains subsidy scheme, Pradhan Mantri Garib Kalyan Yojana (PMGKAY), a top government official said Monday, without pegging a figure for the absolute impact of the scheme. The bigger challenge being seen by the government is the rise in global crude oil prices, but the Centre is confident of meeting its fiscal deficit target of 5.9 per cent of the GDP for financial year 2023-24, another senior government official said.
“There is no major fiscal impact seen for five years (from the food grains subsidy extension),” the official said. On Saturday, Prime Minister Narendra Modi during a pre-election rally in Chhattisgarh, announced that the central government would continue to provide free foodgrains to beneficiaries under the National Food Security Act, 2013 for the next five years. The PMGKAY was to end this December. The extension of the free ration scheme is expected to benefit around 80 crore people and could be a key element of the BJP’s 2024 Lok Sabha campaign narrative.
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