The Hindu : National : Weed out non-deserving subsidies, says Chidambaram

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Weed out non-deserving subsidies, says Chidambaram

Sujay Mehdudia

Public Distribution System subsidy component will not be touched

State governments to blame for corruption
in foodgrains distribution
Improvement in farm sector needed

NEW DELHI: Making a strong plea for removing non-merit subsidies, Union Finance Minister P. Chidambaram on Saturday said a mechanism should be put in place to re-visit sops every three-five years to weed out non-deserving sectors and focus only on the deserving sectors.

He was for continuing subsidies for food, fertilizer and some selected fuels, and asserted that the subsidy component of the Public Distribution System (PDS) would not be disturbed.

Higher provision

The government was not reducing subsidy for the PDS. “The budgeted provision was higher than that in the previous year and we have not increased the issue price of PDS (ration),” Mr. Chidambaram said replying to a debate in the Rajya Sabha on Bills seeking supplementary grants of Rs. 33,290 crore.

After his reply, the House returned the Appropriation Bills on supplementary grants already passed by the Lok Sabha.

Blaming the State governments for massive corruption in distribution of foodgrains through the PDS, Mr. Chidambaram said an expert committee found that only 36.38 per cent of the allocated foodgrains reached the poor and a chunk got lost in leakages through ghost ration cards. “It is an extremely alarming record and it is shameful.”

Asserting that there was no fault in the supply by the Centre, he said the State governments were “solely” responsible for distribution.

On agriculture growth, the Minister said it was expected to be close to four per cent this year. Without improvement in the farm sector, it would not be possible to address the fundamental issues of rural poverty and rural income. “If growth in agriculture remains between two and three per cent, disparity will become wider.”

A target of four per cent agriculture growth in the 11th Plan had been set and to achieve that a number of initiatives were launched. It was only through accelerated growth that the government increased its revenue and allotted more resources to the States.

Referring to the massive allocation of over Rs. 2.31 lakh crore for irrigation in the next five years, Mr. Chidambaram said if the entire money was utilised without corruption and leakage, the agricultural landscape of the country would change dramatically.

Refuting criticism that procurement prices were low, he quoted figures showing that the United Progressive Alliance government had raised these prices by Rs. 195 in the last four years. The increase was a mere Rs. 50 a quintal under the previous National Democratic Alliance government.

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