Union  government will start direct cash transfer of subsidy amount to beneficiaries in 51 districts from the beginning of the next year and targets to introduce the new programme across the country by the end of 2013, Finance Minister P. Chidambaram said today at Pune.
“We are going to launch the ambitious programme of payout of direct cash subsidy to people through the Aadhaar system in 51 districts across 15 states,” Chidambaram said at a banking conference, “Bancon”, at Pune.
Chidambaram said Prime Minister Manmohan Singh will hold a meeting of the cash transfer committee Monday to prepare the ground for implementation of the programme from Jan 1, 2013.
“We want the roll-out (of direct transfer of subsidy) to be completed by the end of 2013,” the finance minister said.
The government intends to give cash subsidies on fertiliser, cooking gas, kerosene and the items supplied through public distribution system (PDS) in a bid to curb leakages in the government spending on subsidies.
Subsidies under various schemes like on petroleum products, fertiliser, and food products account for nearly 3.5 percent of the country’s gross domestic product (GDP). It is one of the major reasons for widening fiscal deficit.
The federal cabinet has already approved the direct cash transfer of subsidies for fertiliser.
The government plans to transfer the subsidy on the basis of unique identification number, called Aadhaar number.
Chidambaram said the government was pushing for the expansion of the banking services across the country.
“Government wants every family to have a bank account,” he said.