The government is considering spending an additional ₹2 lakh crore ($26 billion) in the 2022-23 fiscal year to cushion consumers from rising prices and fight multi-year high inflation, two government officials told Reuters.
The new measures will be double the ₹1 lakh crore hit government revenues could take from tax cuts on petrol and diesel the Finance Minister announced on May 21, both the officials said.
Retail inflation rose to an eight-year high in April, while wholesale inflation rose to at least a 17-year high, posing a major headache for Prime Minister Narendra Modi's government ahead of elections to several State Assemblies in 2022.
