Energy Subsidies

India has historically subsidized energy with the objective of protecting its consumers from international price volatility and providing energy access for its citizens, especially the poor. However, energy subsidies place a heavy burden on government budgets, while often failing to reach their targeted beneficiaries.

In addition to forming a large part of government expenditure in India, subsidies for energy have a tremendous impact on the lives of citizens. At the most immediate level, these subsidies affect how much people pay for energy. However, digging deeper reveals that they have a profound effect on the environments in which people live and the economies in which they earn their living.