NEW DELHI: The extension of India’s free food grain programme will not have a major impact on the fiscal deficit in the financial years 2023/24 and 2024/25, an Indian government source said on Monday. Prime Minister Narendra Modi said on Saturday that his government would extend a welfare scheme, which provides free grain to more than 800 million people and was due to end in December, by five years. The move aims to shield consumers from the rising prices of cereals ahead of a general election early next year, but could lead to higher government spending and require New Delhi to procure more wheat and rice from farmers to sustain the scheme.

Before the extension, the free food grain program was estimated to cost the government around 2 trillion rupees ($24.04 billion) this year.