New Delhi: The government will increase cash subsidy on rice to Rs25.17 per kg to be given to public distribution scheme (PDS) beneficiaries via the direct benefit transfer (DBT) programme.

This marginal hike is applicable for the 2016-17 marketing year starting October, Union food minister Ram Vilas Paswan said on Friday.

This was informed to Puducherry chief minister V. Narayanasamy in a meeting when the state government voiced its concern about lower food subsidy given at present amid higher retail price.

Puducherry was the first to roll out the DBT scheme on food subsidy. The other two Union Territories were Chandigarh, and Daman and Diu.

“Puducherry has demanded increase in rice subsidy given under DBT taking into account the new MSP (minimum support price). We told them that we have already worked out the subsidy amount and will be notified soon," Paswan told reporters after the meeting.

The subsidy on rice has been increased to Rs25.17 per kg for the 2016-17 marketing year starting next month from Rs24.5 per kg this year, he said.

A subsidy of Rs17.06 per kg is being given on wheat via DBT scheme in the ongoing 2016-17 marketing year (April-March). This will be revised in March, Paswan added.

Puducherry gives subsidy on rice under DBT scheme to 6.15 lakh beneficiaries. “Retail price of rice is ruling at Rs28 per kg. We have requested the centre to increase the rice subsidy given via DBT. The centre has assured it will be done," the Puducherry chief minister told reporters after the meeting.

The state government also discussed with the centre the possibility of going back to the earlier system of distributing subsidized grains via PDS. The centre has been asking the states to start a pilot programme to implement DBT for food subsidy. The government provides about Rs1.30 trillion on food subsidy annually.

Close