The Centre is likely to extend later this week the free foodgrain programme for the poor which officially expires on September 30.

Sources said there was consensus on the issue among the different ministries and the only point of discussion was whether to extend it by three or six months.

The government would not like to wreck its image ahead of the crucial elections in Gujarat and Himachal Pradesh, which are likely to be held in December when the term of current Assemblies expire.

It is also chary of dampening the mood during the festive season by scrapping the scheme at a time when food inflation has snowballed into a major concern.

There is, however, a massive cost burden that an extension of the programme will involve.

The food subsidy bill – which has been capped at Rs 2.07 lakh crore in this year’s budget — is expected to balloon.

In its effort to put a lid on its fiscal deficit, the government had cut the food subsidy this year by 27.8 per cent from the revised estimate for fiscal year 2022.

In March, the Centre had extended the Pradhan Mantri Garib Kalyan Anna Yojana scheme by six months till September 30. A fresh extension till March next year could see the food subsidy bill soar to Rs 4.36 lakh crore this fiscal, which means a 111 per cent increase over the budgeted amount.

The beneficiaries of PMGKAY get 5kg of free ration per person per month in addition to their normal quota of foodgrain under the National Food Security Act.