The Government today sought Parliament’s nod for the sanction of an additional Rs 79,590 crore to meet extra expenses related to oil and fertiliser subsidies during the current fiscal, over and above the funds allocated earlier.
This includes an additional Rs 21,000 crore for compensating the oil marketing companies for under-recoveries on the sale of sensitive petroleum products, according to the third supplementary demands for grants tabled in the Lok Sabha.
In addition, Rs 9,000 crore was sought for meeting the defence pension bill and Rs 8,000 crore towards fertiliser subsidies.
Out of the total demand of Rs 79,590 crore, the net cash outgo on meeting the extra expenses during the fiscal would be Rs 68,918 crore. The remaining amount, it added, would be met through savings in other heads of expenses and enhanced recoveries.
The outgo will not have any implications on the fiscal deficit, as the amount has been included in the revised estimates for 2010-11.
The Rs 8,000-crore grant for fertilisers was sought in lieu of a Rs 4,350-crore subsidy on imported decontrolled fertilisers and a Rs 3,650-crore subsidy on indigenous decontrolled fertilisers.
The total grant amount sanctioned for oil marketing companies in the current fiscal stands at Rs 38,558 crore, including Rs 14,278 crore that was allocated toward their under-recoveries last fiscal.
The Government has also sought Rs 3,187 crore for meeting the additional expenditure on recapitalisation of PSU banks and to raise its holding in certain state-run banks to 58 per cent.
The grant also includes a Rs 3,000-crore compensation to state governments for their revenue loss due to reduction in Central Sales Tax and Rs 500 crore towards VAT compensation.
Furthermore, Rs 5,000 crore was sought for extending short-term loans to Food Corporation of India for procurement operations under the targeted public distribution system.
The Government also sought an additional Rs 3,380 crore sanction for the farmers’ debt relief fund to implement debt waiver and debt relief schemes.
It had budgeted Rs 11.08 lakh crore towards various subsidies in the current fiscal, which was later revised to Rs 12.16 lakh crore.