- Explicit Subsidies:
- Specified in the budget document.
- Provided through budgetary resources.
- Example: Food, fertilizer, fuel subsidies (as listed in the budget).
- Implicit Subsidies:
- Provided by offering subsidized public services.
- Not explicitly provided in the budget document.
- Example: Railway services (if fares are below cost), electricity at subsidized rates.
| Feature | Explicit Subsidies | Implicit Subsidies |
|---|---|---|
| Visibility | Clearly specified in budget | Not explicitly shown in budget |
| Mechanism | Direct payment, or provision of goods below market price | Providing subsidized public services |
| Examples | Food, fertilizer, fuel subsidies | Railway services, subsidized electricity |