Direct transfer of benefits in cash to targeted beneficiaries of food and fertilizer subsidies could save an estimated Rs 60,000 cr and help trim the fiscal deficit which, in turn, may calm stubbornly high food inflation, a study by a government wing has shown.
The study showed that policies to rein in food inflation would require winding down of the fiscal deficit, which has gone above 8% of GDP for Centre and states combined and way beyond the guidelines laid out in FRBM (Fiscal Responsibility and Budget Management) Act, 2003.
"CACP's calculations show that direct transfer of food and fertilizer subsidies in cash to targeted beneficiaries has the potential to save almost Rs 60,000 crore, without any major adverse impact on the beneficiaries," the study authored by Ashok Gulati, chairman of the Commission for Agricultural Costs and Prices (CACP), and Shweta Saini said. The CACP advises the government on price policy for major farm commodities to help maintain the interest of producers and consumers.
The study showed that policies to rein in food inflation would require winding down of the fiscal deficit, which has gone above 8% of GDP for Centre and states combined and way beyond the guidelines laid out in FRBM (Fiscal Responsibility and Budget Management) Act, 2003.
"CACP's calculations show that direct transfer of food and fertilizer subsidies in cash to targeted beneficiaries has the potential to save almost Rs 60,000 crore, without any major adverse impact on the beneficiaries," the study authored by Ashok Gulati, chairman of the Commission for Agricultural Costs and Prices (CACP), and Shweta Saini said. The CACP advises the government on price policy for major farm commodities to help maintain the interest of producers and consumers.
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