Budget 2022: FY23 may see lower outgo on food subsidies

The food subsidy Budget estimate for the next fiscal is likely to be around Rs 2.5 lakh crore, according to sources.

In the current fiscal, the subsidy bill is estimated at around Rs 2.25 lakh crore for procurement and distribution of foodgrains under the National Food Security Act (NFSA), and an additional Rs 1.47 lakh crore has been incurred for implementing the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) taking the food subsidy bill for food at over Rs 3.72 lakh crore.

Sources added that the distribution of free food grains during the pandemic to NFSA beneficiaries under the PMGKAY, which was extended till March 2022, is unlikely to be extended further. PMGKAY, India's food subsidy will be pegged at Rs 2.5 lakh crore for the financial year 2022-23, according to sources. 

During 2020-21 fiscal, the government food subsidy stood at Rs 5.29 lakh crore. The Budget is likely to announce a Rs 15,000 crore scheme for the textile sector. Sources said the scheme will focus on giving a boost to textile manufacturing and technology upgradation. The scheme will be for five years and the government will prepare a roadmap to boost the sector. 

Sources also added that export incentive schemes like Rebate of State & Central Taxes and Levies (RoSCTL), Remission of Duties and Taxes on Export Products (RODTEP) may also see an extension.  The Ministry of Textiles notified the introduction of RoSCTL in March 2019. The benefits of RoSCTL are available to exporters of readymade garments and made-ups for now. 

The scheme aims to help them cut high logistics and other costs and enable them to compete globally. Applicable from January 1, 2021, the RODTEP scheme was formed to replace the existing Merchandise Exports from India scheme.  The scheme will ensure that the exporters receive refunds on the embedded taxes and duties previously non-recoverable.

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