Notwithstanding different voices from concerned Ministries and with the sixth phase coming to an end on September 30, the fate of free food programme will be decided at the “highest political level” this week. The ‘Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY)’ has been extended five times since 2020 when it was started.
In June, there were reports about the Department of Expenditure (DoE) advising the government that the scheme under PMGKAY should be stopped beyond September 2022. However, when asked about DoE’s advice, the Minister of State in the Finance Ministry, Pankaj Chaudhary, categorically told the Rajya Sabha — “No”.
For FY23, the Budget has provided approximately ₹2.7-lakh crore for food subsidy which includes expenditure on PMGKAY (dominant share) and distribution of food grains at subsidised rates or free of cost under the public distribution scheme. CAG data show the government spent over ₹64,000 crore during the April-July period. The amount spent during the year-ago period was over ₹92,000 crore.
Buffer stock
The other issue is requirement of foodgrains and buffer stock. Data from Agriculture Ministry show there is requirement of around 39.86 lakhs tonnes, which include 7.12 lakh tonnes of wheat and over 32.73 lakh tonnes of rice. As on September 1, stock of rice was 244.6 lakh tonnes and that of wheat was 248.2 lakh tonnes. Norms for buffer stock prescribe 136 lakh tonnes of rice and 75 lakh tonnes of wheat on April 1.
Although procurement in the kharif is yet to begin, officials in Agriculture Ministry feel the stock will come down with the extension of the scheme. Also, as distribution of rainfall has affected the kharif crop, which could also affect procurements, there will be a resultant impact on the stock.