India, Dec. 4 -- Millions of people (including many undeserving ones) are getting a variety of subsidies from the Central Government and States. These cost crores, impairing the ability of the Centre and States to rein in fiscal deficit (excess of total expenditure over total revenue) within the range mandated under the Fiscal Responsibility and Budget Management (FRBM) Act. These subsidies are administered in an "ad-hoc" and "arbitrary" manner and this leads to misallocation of resources, promotes inefficiency in production, distribution and use, encourages misuse and diversion of funds and makes way for controls.

Successive Governments, led by parties of all hues across the political spectrum, have reiterated their unflinching commitme...