Cabinet Approves Free Ration For Next 5 Years, 16th Finance Commission, Drones To Women SHGs, Rs 24,100 Crore For Tribals

Information and Broadcasting Minister Anurag Thakur has announced that the Union Cabinet has approved certain terms of the 16th Finance Commission during a meeting held on Tuesday (28 November), as reported by The Economic Times.

Finance Secretary T V Somanathan had earlier said that the government aims to establish the 16th Finance Commission by the end of November, in adherence to statutory requirements.

The terms of reference for the commission are currently in the finalisation stage.

It's important to note that the previous finance commission, under N K Singh, recommended a tax devolution ratio of 42 per cent, maintaining continuity with the 14th commission.

This recommendation was accepted by the central government, resulting in states receiving 42 per cent of the divisible tax pool from the Centre for the fiscal period 2021-22 to 2025-26.

The 15th Finance Commission's recommendations included aspects such as the fiscal deficit, debt path for the Union and states, and additional borrowing room for states based on performance in power sector reforms.

The finance commission, a constitutional body, provides suggestions on Centre-state financial relations, including the ratio in which tax is to be divided between the Centre and states for five years, beginning 1 April 2026.

Simultaneously, the Union cabinet has given approval for the extension of the free ration scheme with a substantial outlay of Rs 24,000 crore. This extension, previously announced by Prime Minister Narendra Modi, was pending cabinet approval.

The Pradhan Mantri Garib Kalyan Ann Yojana (PMGKAY), benefiting approximately 80 crore people, will now continue for the next five years, as affirmed by the Prime Minister during a public rally in Durg (Chhattisgarh).

The free ration scheme, initiated during the Covid-19 pandemic to support individuals impacted by lockdowns, has proven to be a vital lifeline for millions.

The government assures that the extension will not impose significant fiscal strain during the fiscal years 2023-24 and 2024-25, providing a sense of financial sustainability in continuing this welfare initiative, according to PTI sources.

In addition, the cabinet approved a central sector scheme for providing drones to women's self-help groups (SHGs).

Thakur mentioned that drones would be provided to 15,000 selected women's SHGs during 2023-24 to 2025-2026 for providing rental services to farmers for agricultural uses.

Furthermore, the cabinet granted a three-year extension to the fast-track special court scheme for rape and POCSO cases.

Additionally, it approved a Rs 24,100 crore scheme for the welfare of vulnerable tribal groups, benefiting about 28 lakh tribals.

Thakur stated that the expenditure for this scheme will be shared by both the center and states.