In the current Budget presented by Nirmala Sitharaman , subsidies is one of the major component of expenditure. In the first term of Modi Government, subsidies on account of Petrol and Petroleum products is rationalised and reduced the subsidy amount in that category. Similarly, an amount of Rs,92,000 crores was saved by effectively using Direct Benefit Transfer Scheme in Centrally sponsored subsidy schemes. However, fertiliser subsidy scheme is one where subsidy is not paid directly to the user. It is being paid to fertiliser dealers instead of farmers. Now, we came to know that Modi Government in its second term is attempting to pay subsidy directly into farmers' account. Government is studying various options how to make it beneficial to the farmers.
1. It will eliminate middleman by that farmer knows at regular intervals about the subsidy on fertiliser used by him.
2. It also reduce the liability to Government overall though real beneficiary is not deprived of the benefit.
3. It also reduce the indiscriminate use of chemical fertilisers. Already , Nirmala Sitharaman announced that Government encourages 'Zero Budget Farming'. This DBT scheme helps in that task. In India, we are using more water, more fertilizers for irrigation purposes. Modi 2.0 initiated measures to conserve both of them which is an urgent and dire need.
This move brings twin objects at a time. It reduces the financial liability as well as financial discipline and reduces usage of chemical fertilisers in the Agriculture. One more reform is required. That is rationalisation of food subsidy. In this Budget, it was estimated the amount at Rs.1,80,000 crores. Ironically, now , UN report has come that 27 crore Indians came out of poverty in the last decade. If 27 crore people came out of poverty, how about increasing the food subsidy to 1.8 lakh crores. A serious re-look should be undertaken in this regard. Needy can be assisted in a big way but leakages should be plugged.