India extends free food programme by 3 months amid fiscal woes
This will add US$5.46 billion to the government's costs and make for a bigger challenge to efforts to rein in the fiscal deficit.
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India has extended by three months its free food programme for the poor, a move that will add US$5.46 billion to the government's costs and make for a bigger challenge to efforts to rein in the fiscal deficit.
Most economists expect India to miss its fiscal deficit target of 6.4% of GDP for the year ending in March 2023, thanks to government measures to fight inflation that could cost more than US$20 billion.
India has spent about US$43 billion since April 2020 on the programme to give families 5kg of foodgrains each month.
It will now be extended until December, Information Minister Anurag Thakur told a news conference.
The government has restricted rice exports on growing concern about grain stocks, in addition to export curbs on wheat and sugar.
Wheat stockpiles at state-run agencies fell to 24.82 million tonnes by Sept 1 from 51.78 million a year ago as government purchases from farmers more than halved this year.
Rice stocks stood at 35.36 million tonnes at the beginning of this month, down from the last year’s 38.73 million.
The free food programme is expected to require an outflow of 12.2 million tonnes of foodgrains, the government has said.
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