The minister also said a record number of 1.75 lakh Muslims will undertake the pilgrimage this year from India despite the subsidy withdrawal.
"There will be no subsidy on Haj now," he told reporters, adding that the government had spent over Rs 250 crore last year on subsidising the annual pilgrimage of Muslims to Saudi Arabia.
The BJP had cited the subsidy as an example of "Muslim appeasement" by parties such as the Congress.
Following the order, the subsidy was being gradually reduced every year.
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"It is part of the Modi government's efforts to empower minorities with dignity and without appeasement," Naqvi said.
The funds would be utilised for providing education to minorities, he said.
Asked if the subsidy withdrawal will make the cost of the pilgrimage too high for many Muslims, Naqvi said the government was making efforts to bring it down.
Naqvi said his ministry is also organising an event in Lucknow on January 18 in which he and Uttar Pradesh Chief Minister Yogi Adityanath will speak on "empowering minorities without appeasement" with the help of central schemes.
Minority affairs ministers of nine states will also attend the event, he added.
Reacting cautiously to the government's decision, the Congress said it hopes that the Modi government will honour the apex court's direction and utilise this money for the education and development of the disempowered among the minorities, including young girls.
Welcoming the Centre's decision, the Vishva Hindu Parishad said the money saved from it should be utilised for the education of poor Hindu girls.
According to sources in the minority affairs ministry, till 2017, the notional savings following gradual abolition of subsidy since 2012 was to tune of Rs 636.56 crore. In case, the government had chosen to reduce the subsidy gradually till 2022, the total national savings would have have been around Rs 5970.6 crore, the sources said.
There are a total of 21 Haj embarkation points (EPs) in the country -- Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Lucknow, Hyderabad, Cochin, Indore, Srinagar, Bhopal, Guwahati, Mangaluru, Aurangabad, Varanasi, Jaipur, Nagpur, Ranchi, Gaya, Ahmedabad and Goa.
Haj aspirants -- for whom the 10 airports of Srinagar, Guwahati, Ranchi, Gaya, Indore, Bhopal, Mangaluru, Goa, Aurangabad and Varanasi are the nearest EPs - will now get an additional economical option to fly from.
The airfare for Haj 2018 may vary, ministry sources said.
Similarly, aspirants whose basic EPs are Guwahati, Ranchi and Gaya will have the alternative of undertaking the journey from Kolkata. Those having Indore, Bhopal, Goa and Aurangabad as the nearest airports, can opt for flying from Mumbai.
Those with Varanasi as the basic airport can choose Lucknow as their optional embarkation point while those with Mangaluru as their EP will have the option of Bengaluru.
Naqvi also cited a host of measures, such as providing jobs and job opportunities to 8.5 lakh minority youth and scholarships to 1.83 crore students, to claim that the BJP-led NDA government has been working to empower minorities.
His ministry is entrusted with welfare measures for minorities that include Muslims, Sikhs, Christians, Zoroastrians (Parsis), Buddhists and Jains.
Naqvi, the lone Muslim cabinet minister in the government, also claimed that his ministry had succeeded in helping a lot of youths in getting employment by training them as GST facilitators.