Topic: Issues related to direct and indirect farm subsidies and minimum support prices;
5. What are the various types of subsidies offered in India? Evaluate the extent and effectiveness of subsidies. How can India reduce its subsidy bill? (250 words)
Difficulty level: Tough
Reference: Indian Express , Insights on India
Why the question:
The Rs 532,446.79 crore spending on subsidy in 2022-23 would be the second highest after the Rs 706,006.53 crore of 2020-21. However, there’s a difference between the two years.
Key Demand of the question:
To write about the types of subsides, their effectives and measures needed to reduce the subsidy bill.
Evaluate – When you are asked to evaluate, you have to pass a sound judgement about the truth of the given statement in the question or the topic based on evidence. You must appraise the worth of the statement in question. There is scope for forming an opinion here.
Structure of the answer:
Begin by giving statistic related to Subsidy bill of India and its extent.
First, write about the various types of subsidies that are present in India.
Next, give a brief history of subsidies as a concept that evolved in India since independence and that rationale behind subsidies. Give about the various success and limitations of subsidies. Cite statistics to substantiate.
Next, write about the ways that the government can reduce its subsidy bill.
Conclude by writing a way forward on overcoming the above shortcomings.