The report noted that despite the increase in expenditure in the noted areas, expenditure on fisheries subsidies declined from MVR 207.4 million to MVR 83.1 million.
PSM News
The Ministry of Finance, in its latest release of the Weekly Fiscal Development Report, noted that subsidy expenditure is at 3.13 billion, with a majority of the spending aimed at keeping the prices of essential goods and services, including oil and electricity, from rising and ensuring they remain affordable for the public.
According to the report, Government-owned companies spend the difference between the cost of providing these goods and services and the control price from the state budget. The Ministry of Finance and Public Enterprises, compiled by 16 July 2026 and informed in conjunction with the latest release of the Weekly Fiscal Developments Report, stated that the main reason for this sharp increase in subsidy expenditure was the sharp increase in expenditure on fuel and electricity subsidies. Oil subsidy expenditure rose from MVR 702.1 million in 2025 to MVR 1.8 billion. This is the area with the highest subsidy spending this year. The increase in fuel subsidy spending is due to the sharp increase in the price of refined oil in the world market, due to the war in the Middle East.
Electricity subsidy expenditure also increased from MVR 341.3 million to MVR 626.7 million. In addition, expenditure on waste management subsidies increased from MVR 33.9 million to MVR 90.6 million. Transport subsidies will increase from MVR 128.5 million in 2025 to MVR 201.6 million, with the expenditure on food subsidies increasing from MVR 199.4 million to MVR 243.9 million.
Despite the increase in expenditure in these areas, expenditure on fisheries subsidies declined from MVR 207.4 million to MVR 83.1 million. The expenditure on sewerage subsidy of MVR 67.8 million remained unchanged.
Statistics show that in 2026, fuel and electricity subsidies will account for the largest share of the total expenditure.
