Central Government to scrap sugar subsidy
Posted on: 27/Jan/2017 12:24:59 PM
There is news that the central government has decided to stop the sugar subsidy which is sold in the ration shops.
In order to supply sugar at a low price through ration shops to the people living below poverty line, the central government is giving subsidy to the state government.
As per the existing scheme, states purchase sugar to be supplied through the ration shops, from the open market at wholesale rates and sell at a subsidized rate of Rs 13.50 per kg. The states get subsidy at Rs 18.50 per kg from the central government.
The scheme has a target of 40 crore beneficiaries of BPL (below poverty line) families. At this juncture there are indications from the finance ministry that the existing sugar subsidy scheme could be discontinued from the next fiscal.
The central government’s contention is that there is no delineation for BPL families in the new Food Law and there are apprehensions that state governments may divert subsidized sugar,
Due to this, the existing sugar subsidy scheme could be discontinued from the next fiscal. This move will save about Rs 4,500 crore to the central government.
Meanwhile, Food Minister Ram Vilas Paswan has written to Jaitley demanding not to discontinue the scheme entirely and proposed continuance of it for at least Antyodaya Anna Yojana families, the poorest of the poor segment.
It is understood that the food ministry has already alerted out states that the central government may withdraw subsidy on sugar from next financial year.
