MUMBAI (Reuters) -India will spend 4.57 trillion rupees ($52.81 billion) on subsidies for food, fertilisers and rural employment schemes in the next financial year, nearly unchanged from the current year’s allocation, according to the federal government’s budget documents released on Saturday.
The federal government has budgeted a collective spending of 4.54 trillion rupees for the current fiscal year ending March 31 across the three types of subsidies, as per the government’s revised estimates.
The allocation for the government’s flagship rural jobs guarantee programme has been retained at 860 billion rupees, while that for fertilisers has been marginally lowered to 1.67 trillion rupees from 1.71 trillion revised estimate for 2024-25.
The Asian country has budgeted food subsidy for the upcoming financial year at 2.03 trillion rupees, slightly above the 1.97 trillion revised estimate for the ongoing fiscal.
India’s Finance Minister Nirmala Sitharaman presented the government’s annual budget in the backdrop of slowing growth in Asia’s third-largest economy and rising global uncertainties.
The slowdown has been marked by weakness in urban consumption and lackluster private sector investment, although the rural economy, which the employment and fertiliser schemes are aimed at, is showing signs of recovery.
Under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), first introduced in 2006, citizens can enrol for work such as building roads, digging wells or creating other rural infrastructure and receive a minimum wage for at least 100 days each year.
India’s unemployment rate stood at 7.8% in December 2024, marginally higher than 7.7% the previous month, data from the Centre for Monitoring Indian Economy showed.
In absolute terms, the number of unemployed persons increased from 34.7 million to 35.6 million, the data showed.
($1 = 86.5360 Indian rupees)
(Reporting by Jaspreet Kalra; Editing by Sumana Nandy)
