Subsidy (Business & Economy)

Subsidy is the term used for the amount that is paid by the government to the producers of products and services for maintaining low prices as determined by the government.
Subsidy is inverse to the taxes. Just as the price of the product is increased by adding taxes in it, the same way subsidy reduce the price of the product.
Within last 8 years the centre’s annual subsidy has increased 280% i.e. from 12,158 crore to 46,869 crores, as per the record maintained.
Infact, subsidy is meant for poor people, who are not able to buy the necessities of the life. But some of the corrupt govt. officials misappropriate these accounts of subsidy, and use the black money for vested interests. This is not a fair practice. The corrupt officials must be punished, who involve in such unfair practices. Due to the corruption and unfair practices, the subsidised commodities and services don’t reach the needy people. The corrupt official usually give these commodities to their own acquaintances and friends. Thus, the poor lot of the nation are ignored.
Subsidies at a glance:
❑ The annual food subsidy is Rs. 25,200 crore, that amounts to Rs. 69 crores per day.
❑ The annual petroleum subsidy is Rs. 6,573 crores, that amounts to Rs. 18 crore per day.
❑ The annual fertiliser subsidy is 11,797 crores, means 32 crores are granted by the government per day.
❑ The annual subsidy for railways is 11,228 crores, means 3 crores are granted per day by the government.
Infact the government must take a balanced approach of everything, else it may incur losses. It must provide subsidy to really poor people and those who deserve.
Infact at present, our country suffers from inclusion error and exclusion error.
Inclusion error means that the wrong kind of people are benefitted and exclusion error means that the deserving people are left out of subsidies.
Thus, the needy people are ignored and undeserving people desire benefits. The government must take strict measures to check this menace immediately, else it shall create hindrances in the progress of the country.