Central government will expand the scope of its successful direct benefit transfer (DBT) scheme to provide food and fertilizer subsidies directly into the accounts of beneficiaries, Expenditure Secretary Girish Chandra Murmu said.
The DBT being implemented in fertilizer subsidy payment isslightly different from the normal DBT being used in LPG subsidy. Under the DBTin fertilizer sector, the subsidy is released to the fertilizer companiesinstead of the beneficiary farmers after the sale is made by the retailers tothe farmers.
Murmu said that a true DBT system where the subsidy isdirectly provided into the accounts of farmer beneficiaries would bekick-started this year.
“After the launch of PM Kisan scheme, farmer data isauthenticated with Aadhaar and (bank) accounts are seeded. This would make itpossible to use this data to disburse fertilizer subsidy directly into theaccounts of beneficiaries,” Murmu told IANS.
Fertilizer subsidy can be given directly to farmers usingthe data on land holdings, soil health card, etc in a gradual manner.
He also hinted that farmer data under PM Kisan scheme mayalso be used for initiating DBT for disbursing food subsidies. Under PM Kisan,around 14.5 crore farmers will get Rs 6,000 per year directly into their bankaccounts.
“If we do targeted benefit there might be savings ontotal subsidy outgo as well,” the Expenditure Secretary said suggestingthough that subsidies as percentage of GDP has remained constant at 1.4-1.5 percent.
On an absolute basis, the subsidy bill on food, fertilizerand fuel is estimated to go up by 13.32 per cent to Rs 3,01,694 crore in FY20.
Direct transfer of subsidy to beneficiaries could not beintroduced in fertilizer sector earlier, as the beneficiaries and theirentitlement was not clearly defined. Multiple subsidized products, urea and 21grades of phosphatic & potassic fertilizers have different subsidy rates.But with clear identification of beneficiary, this problem is expected to beresolved.
The fertilizer subsidy is projected to increased by 14.14per cent to Rs 79,996 crore in 2019-20 from the revised estimate of Rs70,085.70 crore in the last fiscal.
Apart from fertilizer, the government plans to initiate DBTalso for disbursing food as well as power subsidies. A mechanism is beingworked out for that. It is expected that, based on the inputs coming from onefull year operation of PM Kisan scheme. further action on DBT plan would betaken.