The Union Cabinet on November 29 approved a proposal to extend the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) to provide free food to around 81 million poor people for another five years till December 2028.
In a cabinet briefing, Union Minister Anurag Thakur said the extension will cost the exchequer around Rs 11.8 crore. The extension will be effective from January 1, 2024. The decision in this regard was taken in a cabinet meeting chaired by Prime Minister Narendra Modi on November 28.
Earlier this month, Prime Minister Modi, while addressing an election rally in Chhattisgarh, said the Center would extend the free ration scheme for five years.
During the briefing, Thakur said that there would be no shortage of funds or any procurement problems due to the extension of the free ration scheme for 5 years. Amid fears of inflated food subsidy bills as a result of this extension, Thakur said money or budget was not an issue for the central government.
PMGKAY was launched in April 2020 to help the poor during the Covid-19 pandemic for three months, but was later extended. Under this free rationing scheme, poor families receive 5 kg of food grains every month.
In December last year, the Center had decided to bring PMGKAY, which was launched in 2020 to provide additional foodgrains free, under the National Food Security Act (NFSA). As per NFSA, up to 75 per cent of the rural and 50 per cent of the urban population are covered under two categories – Antyodaya Anna Yojana (AAY) and priority households.
During the 2023 budget announcement, Union Finance Minister Nirmala Sitharaman said that the Center will bear Rs 2 lakh crore under PMGKAY for the entire year. Before the five-year extension, the free food grain plan was due to end in December 2023.
The extension is expected to offer relief to consumers at a time when the decline in food inflation has been limited. The central government has already taken a number of measures in the past few years to ease price pressures, from banning exports of wheat, rice and onions to selling discounted tomatoes.
Data released on November 13 showed that India’s headline retail inflation rate fell to a five-month low of 4.87 percent in October, staying within the Reserve Bank of India’s (RBI) tolerance band of 2-6 percent for the second consecutive month. However, food inflation was little changed at 6.61 percent, after reaching 6.62 percent in September.
