Subsidy Bills to keep all guessing

It���s set to be yet another year of high off-Budget accounting. The government���s bill for major subsidies is pegged at Rs 66,537.38 crore for budget estimates (BE) 2008-09, only Rs 2,000 crore above the revised estimates (RE) (2007-08) of Rs 64,928.60 crore. But those figures may be unrealistic.

A big part of the off-Budget accounting is likely to be due to farm/food subsidies, which together made for an estimated Rs 80,000 crore in 2007-08. Fertiliser subsides alone were pegged at Rs 47,000 crore-odd for 07-08 but RE for 07-08 is only Rs 30,501 crore. For 2008-09, the DoF estimates the subsidy bill at Rs 65,000 crore. What it has got is just Rs 30,986.36 crore. In effect, farm loans would be waived off but the farmer could face acute short supply in inputs to buy with his fresh credit.

The botching up of fertiliser subsidy accounting shows up in the Budget papers. Vol 1 of the Expenditure Budget pegs BE 08-09 for indigenous urea subsidy at Rs 12,900.37 crore, the same as RE 07-08. But Vol 2 hikes the RE (07-08) figure to Rs 16,400.37 crore. The food subsidy bill has also risen by Rs 5,850 crore in the RE stage compared to Rs 25,696 crore (BE 07-08), thanks to high-priced wheat import orders of almost 1.8 million tonnes.