New Delhi, Feb 04: The petroleum subsidy has been halved in the interim budget by Finance Minister Jaswant Singh. The subsidy has been brought down to Rs 3,560 crore in the budget proposals for 2004-05, from Rs 6,573 in the current fiscal.

However, this will not push up the prices of petrol or kerosene, Finance Secretary D C Gupta said. Most of the subsidy would be absorbed by the public sector oil companies and other organisations, Gupta said while addressing the customary post-budget press conference.
The Finance Secretary said the subsidy provision for next fiscal was made on the basis of the government's commitment to phase out petroleum subsidy over three years.
The subsidy cut figures only in the expenditure budget 2004-05, presented along with the interim budget, but not in the Finance Minister's speech.
Singh has, however, hiked the subsidy for other items. Subsidy for food has gone up from Rs 25,200 crore to Rs 27,800 crore, for imported urea from Rs 1 crore to Rs 473 crore and for indigenous urea from Rs 8,139 crore to Rs 8,143 crore.
The total subsidy bill for 2004-04 is placed at Rs 45,175 crore, up from Rs 44,707 crore.
Bureau Report