India proposes ‘economic stabilisation fund’ to tackle global headwinds
- There is no increase in overall expenditure beyond what was projected in the budget, Sitharaman says
NEW DELHI: India has proposed an ‘economic stabilisation fund’ to provide fiscal headroom for the country to respond to global headwinds, Finance Minister Nirmala Sitharaman told parliament on Friday.
The 573-billion-rupee ($6.20 billion) proposed fund will also help the government to respond to unanticipated supply chain disruptions and unexpected shocks to the Indian economy, Sitharaman said.
This week, the Indian government had sought parliament’s approval for gross additional spending of 2.81 trillion rupees, part of which will be offset by savings and higher receipts from ministries and departments.
There is no increase in overall expenditure beyond what was projected in the budget, Sitharaman said.
Sitharaman also proposed additional fertiliser subsidies of about 192.30 billion rupees to meet higher spending under the nutrient-based subsidy policy and urea subsidy payments.
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India’s fertiliser subsidy bill has come under pressure after the Iran conflict disrupted supply routes through the Strait of Hormuz, a key corridor for global fertiliser shipments, pushing up prices of crop nutrients such as urea and ammonia and raising import costs for major buyers like India.
Sitharaman said there would be no shortfall in funds for fertiliser subsidies for farmers.
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