Indian govt seeks parliament nod for extra spending for FY24


New Delhi (Reuters) – The Indian government on Wednesday sought parliament’s approval for additional spending of 1.29 trillion rupees ($15.48 billion) in the current fiscal year, mainly towards higher subsidies for farmers and a rural job employment programme.

The government said the net additional spending for the current fiscal year ending March 31, would be 583.78 billion rupees, while the rest would be accommodated by reshuffling expenses.

Prime Minister Narendra Modi’s administration said it would spend 133.51 billion rupees for fertiliser subsidies, while it would spend another 145.24 billion rupees for a rural unemployment scheme.

Modi, who will be seeking a third consecutive term in the national polls in about six months from now, has been doling out welfare measures via food and fertiliser subsidies, cheaper cooking gas and other measures to pump up the rural economy that is showing signs of weakness.

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The additional fertiliser subsidies will raise the total subsidy for the current fiscal year by nearly 8% to 1.88 trillion rupees, while the minimum wage paying rural income scheme will be raised by nearly 24% to 745.24 billion rupees for the current fiscal year.

The government has sought an additional 55 billion rupees for food subsidies, in addition to 1.97 trillion budgeted for the year.

Even after higher allocation for fertiliser this fiscal year, the money spent on this would be lower than the 2.51 trillion rupees spent in the last fiscal year. Food and fertiliser subsidies make up the bulk of spending by the government.

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The additional spending this fiscal year will not lead to widening of the budget deficit beyond the target of 5.9% of gross domestic output as tax collection is likely to be higher than expected, two government officials, who did not want to be identified as they are not authorised to speak to media, said.

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