Spatial Distribution of Fossil Fuel Subsidies in India - Data Update  

This data brief updates the calculations of total and average per capita fuel subsidy expenditure by state and Union Territory (UT) provided in IISD’s previous data brief on the spatial distribution of fossil fuel subsidies in India for fiscal year (FY) 2013/14 [1]. In FY 2013/14, total subsidy expenditure on diesel, LPG and kerosene declined to Rs. 146,339 crore (USD $24.0 billion) from its record high of Rs. 163,759 crore (USD $26.9 billion) in FY 2012/13. This decline in total expenditure was entirely due to a reduction in annual diesel subsidies of over 30% (from Rs. 92,061 crore (USD $15.1 billion) to Rs. 62,837 crore (USD $10.3 billion)), with total LPG expenditure increasing substantially from Rs. 41,547 crore (USD $6.8 billion) to Rs. 52,246 crore (USD $8.9 billion), and kerosene rising marginally from Rs. 30,151 crore (USD $5.0 billion) to Rs. 31,256 crore (USD $5.1 billion). Figures 1 to 4 below outline the approximate state-wise distribution of total, diesel, LPG and kerosene subsidy expenditure by value and percentage of total outlay in FY 2013/14.

On a per capita basis, smaller states and union territories remained the largest recipients, with Daman & Diu receiving the greatest per capita transfer (Rs. 4,571 per person), followed by Andaman & Nicobar (Rs. 3,886), Dadra & Nagar Haveli (Rs. 3,721), Puducherry (Rs. 3,014) and Goa (Rs. 2,903). Among major states, Haryana remained the largest per capita recipient of subsidies by a substantial margin (at Rs. 2,556 per person), while Delhi overtook Punjab as the second highest per capita recipient (receiving Rs. 1,967 and Rs. 1,912 per person respectively) due to the reduction in the scale of diesel subsidies and continued increases in LPG subsidy expenditure (see Figure 5). Bihar continued to be the lowest per capita subsidy recipient among all states and Union Territories at Rs. 602 per person, followed by Assam (Rs. 814), Jharkhand (Rs. 835), Uttar Pradesh (Rs. 840), Chhattisgarh (Rs. 856), Madhya Pradesh (Rs. 925), Odisha (Rs. 926) and West Bengal (Rs. 936).

Per capita diesel subsidy transfers were approximately 30% lower in FY 2013-14 in comparison to the previous year, reflecting the reduction in overall diesel subsidy expenditure. Smaller states and union territories remained the largest recipients on a per capita basis, with Daman & Diu receiving the greatest per capita transfer (Rs. 3,212), followed by Andaman & Nicobar (Rs. 2,738), Dadra & Nagar Haveli (Rs. 2,354) and Puducherry (Rs. 2,090). Haryana continued to be the largest per capita recipient among major states, receiving over three times (Rs. 1,770 per capita) the national per capita average of Rs. 506, followed by Punjab (Rs. 1,040) and Tamil Nadu (Rs. 770) (see Figure 6 and 7). Bihar remained the lowest per capita recipient of diesel subsidy transfers, receiving Rs. 175 per capita, followed by Assam (Rs. 219), West Bengal (Rs. 259) and Uttar Pradesh (Rs. 281).

In contrast, per capita LPG subsidy transfers were approximately 20% higher in FY 2013-14 than in the previous year. Delhi was the highest per capita recipient among all states and UTs at Rs. 1,340 per capita, followed by Chandigarh (Rs. 1,243), Daman and Diu (Rs. 1,185), Goa (Rs. 1,162) and Dadra and Nagar Haveli (Rs. 1,119). Punjab, the second largest recipient among major states after Delhi, received almost half the equivalent per capita transfer (Rs. 766), followed by Tamil Nadu (Rs. 702) and Haryana (Rs. 668) (see Figure 8 and 9). Jharkhand and Bihar remained the lowest per capita recipients (both receiving an average of Rs. 170 per capita), followed by Odisha (Rs. 184), Chhattisgarh (Rs. 195) and Assam (Rs. 244).

Per capita kerosene subsidies were slightly higher for most states and UTs in comparison to the previous financial year, reflecting in part the administrative redistribution of total kerosene subsidy expenditure (with states such as Tamil Nadu and Maharashtra seeing significant reductions in total kerosene allocations). Sikkim remained the highest per capita recipient (Rs. 770), followed by Lakshadweep (Rs. 660), and Andaman and Nicobar (Rs. 559). Among major states, Jammu and Kashmir remained the largest recipient (Rs. 498), followed by Gujarat (Rs. 371), West Bengal (Rs. 351) and Assam (Rs. 350) (see Figure 10 and 11). Reflecting its continued phase-out of kerosene supply, Delhi remained the lowest per capita recipient (Rs. 23), followed by Punjab (Rs. 106), Haryana (Rs. 117) and Kerala (Rs. 120).

Taking LPG and kerosene subsidies together (with the exclusion of diesel subsidies, which were formally discontinued in October 2014), Delhi was the highest per capita recipient (Rs. 1,362 per capita in FY 2013/14, consisting almost entirely of LPG subsidies), followed by Tamil Nadu (Rs. 881 per capita), Jammu and Kashmir (Rs. 880 per capita) and Punjab (Rs. 872 per capita) (see Figure 12) - with Jammu and Kashmir a notable outlier among the higher recipient states in the predominance of kerosene subsidies within overall LPG and kerosene subsidy receipt. As with total subsidy distribution, poorer eastern and central states (including Chhattisgarh (Rs. 422), Bihar (Rs. 427), Jharkhand (Rs. 438), Odisha (Rs. 501), Uttar Pradesh (Rs. 559), Madhya Pradesh (Rs. 565) and Assam (Rs. 595)) are the lowest recipients on a per capita basis, with kerosene typically constituting the majority of total subsidy transfers.

[1] Presented on the same basis as FY 2012-13 data (see footnote 1), with an additional uniform 1.3% increase in state population figures. Data for FY 2013/14 derived from Ministry of Petroleum and Natural Gas (MoPNG) (2014) ‘Basic statistics on Indian petroleum and natural gas - 2013-14’. New Delhi: Government of India.