India to extend free food grains programme by five years

MUMBAI, Nov 05 (Reuters): India is planning to extend its free food grains programme by five years, Prime Minister Narendra Modi said on Saturday, as the government tries to shield consumers from rising prices of cereals ahead of a general election early next year.
The extension will offer relief to consumers, but it will also lead to higher government spending and require New Delhi to procure more wheat and rice from farmers to sustain the welfare programme, which provides free grains to more than 800 million people.
Modi confirmed the move at an election rally in Durg, a city in the central state of Chhattisgarh, where state elections are due this month.
The grains programme, estimated to cost the government around 2 trillion rupees ($24.06 billion) this year, was due to expire at the end of the year.