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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.This guide focuses on the scale and impacts of energy subsidies in India. 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.