The Centre has transferred of assorted subsidies and sops to the beneficiaries through the direct benefit transfer (DBT) worth about Rs 3.2 trillion so far in the current financial year. These transfers have roughly been at the same level as in the year-ago period, despite discontinuation of the fiscally expensive extra free food grains scheme from January 2023.
Given the government’s ongoing drive for saturation of welfare schemes and launch of a few new schemes such as Vishwakarma scheme for artisans, the DBT transfers in FY24 are expected to be around Rs 7 trillion, the same level as in FY23.
Of the DBT transfers so far in FY24, Rs 2.07 trillion or 65% was in kind and the balance cash transfers to Aadhaar-linked banks accounts.
Subsidies worth about Rs 0.86 trillion were transferred to beneficiaries via foodgrains under the public distribution system (PDS) so far in FY24. The food DBT through PDS will likely end the year around Rs 2.2 trillion in FY24 compared with Rs 2.73 trillion. The reduction in the food DBT was due to the discontinuation of free grains scheme.
The supply of free grains in addition to PDS grains was initially launched for the April-June period of FY21 after Covid broke out; it was later extended till December FY23.
Among other major DBT schemes, the government has provided fertiliser subsidy worth Rs 1.21 trillion to farmers so far in FY24. Around Rs 42,000 crore have been transferred for job guarantee scheme (MGNREGS) so far in FY24. 23523
Assistance for beneficiaries under Pradhan Mantri Gramin Awas Yojana-Rural (PMAY-R) beneficiaries so far in FY24 stood at about Rs 23,523 crore.
The DBT system has enabled the government to save significantly on its social-sector welfare expenditure through targeted deliveries. The government’s cumulative savings on expenditure, thanks to the DBT till FY22-end, was 2.73 trillion.
The jump in DBT from FY19 onwards could be largely attributed to the increased use of Aadhaar-enabled DBT platforms for in-kind food and fertiliser subsidy distribution. According to an estimate by the Centre, the Aadhaar-enabled DBT platform helped eliminate 41.1 million fake LPG connections, 42 million duplicate ration cards and resulted in 10% savings on wages on account of the deletion of non-existent MGNREGS beneficiaries.