Subsidies Need to be Rationalised: Jaitley

The government wants to reduce its subsidy bill, estimated at nearly 2 per cent of its gross domestic product, to cut down state expenditure and transfer funds to other sectors, Finance Minister Arun Jaitley said at Davos.

"Subsidies for the poor will remain, but we intend to rationalise it," Arun Jaitley said at an event in Davos on Thursday.

"Elimination of subsidies in India, where one-third of the people are still living in poverty conditions, is not possible, is not desirable."

Mr Jaitley will present his first full-year budget for 2015/16 fiscal year on February 28.