The Centre spent a total of Rs 3.43 trillion for the seven-phase implementation of Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) between April, 2020 and December 2022, as per provisional data.
This expenditure is against an earlier estimate of Rs 3.9 trillion for the free ration scheme, because off-take of grains by the states at 9.17 million tonne was 23% less than the initial estimate in the seventh phase (October-December, 2022) of the scheme. The expenses on PMGKAY’s last phase were Rs 34,208 crore against an earlier estimate of Rs 44,762 crore.
The Centre has distributed more than 100 MT of foodgrains under the free ration scheme since its launch in April 2020 to reduce hardships of people during the Covid-19 pandemic.
The food ministry had informed states that lifting of foodgrain under the scheme would be allowed only till December 31, 2022. Last month, the Cabinet decided against extending the scheme.
According to estimates, against an allocation of 2.11 MT of wheat to be distributed under PMGKAY during Oct-December 2022, states have lifted 1.89 MT. In the case of rice, states have taken possession of 7.27 MT against an allocation of 9.89 MT.
The scheme has run continuously with several extensions, except between December 2020 and April 2021. The latest extension was for three months till December 31, 2022.
Under the free ration scheme, 5 kg foodgrains per person per month was provided to more than 800 million beneficiaries free, along with an equal quantity of highly subsidised foodgrains under National Food Security Act.
The government’s food subsidy expenses in the current fiscal are likely to cross Rs 2.76 trillion, up 34% from the outlay at the beginning of the year.
The annual cost to the exchequer for providing free grain under NFSA is estimated at Rs 2 trillion for 2023-24, including the additional cost of around Rs 20,000 crore for making NFSA grain supply in 2023 totally free of cost to beneficiaries.
Meanwhile, FCI’s wheat stock fell to 17.1 MT at the beginning of year, a six-year low. This is against the buffer of 13.8 MT. However, the current stock of 12.5 MT of rice along with 31.9 MT to be received from millers is far more than the buffer of 7.6 MT.