From fuel to food: What remains covered as Malaysia shifts from blanket to targeted subsidies amid fiscal reforms?

KUALA LUMPUR, Oct 28 — Subsidies in Malaysia have come a long way since independence when it was first introduced decades ago as a tool for economic support in boosting agriculture production and social welfare.

In recent years, however, the Malaysian federal government has embarked on a rationalisation exercise to implement targeted subsidy policies rather than blanket ones as part of the country’s ongoing fiscal reforms.

By definition, subsidies are support elements provided by the federal government, which are directly channelled to producers, businesses or service providers to stabilise prices.

Indirectly, subsidies enable goods and services to become more affordable, subsequently easing the financial burdens of low and middle-income households.

Earlier this year, Prime Minister Datuk Seri Anwar Ibrahim did away with blanket diesel subsidies and, after several hints, has now given a timeline to do the same with RON95 petrol that is used by the majority of Malaysians.

Fuel subsidies rationalisation aside, Malay Mail takes a look at some of the existing government subsidies that are still ongoing based on information obtained from federal government ministries and annual fiscal outlooks.