India Proposes ₹573 Billion Economic Stabilisation Fund to Tackle Global Shocks
India has proposed the creation of a ₹573-billion ($6.20 billion) Economic Stabilisation Fund aimed at strengthening the country’s ability to respond to global economic uncertainties. Finance Minister Nirmala Sitharaman informed parliament on Friday that the fund would provide fiscal headroom to manage external headwinds, supply-chain disruptions, and unexpected economic shocks that could affect the Indian economy.
The announcement came as the government sought parliamentary approval for gross additional spending of ₹2.81 trillion, part of which will be offset through savings and higher receipts from various ministries and departments. Sitharaman clarified that the proposal would not increase overall expenditure beyond the levels projected in the Union Budget, ensuring fiscal discipline while creating a buffer against potential global volatility.
The finance minister also proposed additional fertiliser subsidies of about ₹192.30 billion to address rising costs under the nutrient-based subsidy policy and urea subsidy payments. India’s fertiliser subsidy bill has been under pressure after the Iran conflict disrupted shipping routes through the Strait of Hormuz, a key corridor for global fertiliser supplies, driving up prices of crop nutrients such as urea and ammonia. Sitharaman assured parliament that there would be no shortfall in subsidy funds for farmers despite the rising costs.
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