| Finance Minister P Chidambaram has kept the subsidy payout in the next financial year almost similar to that in the current financial year. |
| He has budgeted for Rs 54,330 crore as subsidy payout for the 2007-08 financial year, up 1.62 per cent from the revised estimate of Rs 53,463 crore in FY07. |
| The government has exceeded its budgetary estimate of Rs 46,213 crore for the current financial year by 15.66 per cent. Subsidy would continue to account for 7 paise of each rupee that would be spent in 2007-08. |
| In the water recharging scheme, subsidy for small farmers has been increased to 100 per cent while it is 50 per cent for other farmers. The FM announced a Rs 22,452 crore fertiliser subsidy for farmers. |
| The government is also planning to conduct a study, based on which a pilot programme would be launched where subsidy on fertilisers would be given directly to farmers. |
| Chidambaram also extended by five years the Textile Upgradation Fund Scheme that offers 5 per cent interest subsidy for expanding textile firms. The scheme was set to expire on March 31, 2007. |
| The subsidy on liquefied petroleum gas (LPG) and kerosene has been extended for an indefinite period. The Budget provides for Rs 2,650 crore for subsiding LPG and kerosene at the rate of Rs 22.58 per 14.2 kg LPG cylinder and Rs 0.82 a litre of kerosene sold through the public distribution system. |
| As per the five-year phase-out plan, subsidies on the two cooking fuels were to end on March 31, 2007, but the finance minister, by providing an amount almost equal to the one provided in 2006-07, has extended the subsidy regime. The loss on sale of LPG would be Rs 171 per cylinder and that on kerosene Rs 12.73 a litre. |
| "Under-recoveries on LPG and kerosene makes up the major part of our total under-recoveries. Controlling prices of LPG and kerosene needs to be seriously looked into," an official with Indian Oil Corporation, the country's biggest retailer of petroleum products, said. |
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