Don’t stop paddy bonus: Raman to PM

Chhattisgarh today pays Rs 300 bonus per quintal, the highest in the country.

Written by Ashutosh Bhardwaj | Raipur | Published: October 13, 2014 1:21:45 am

Highlighting the condition of Chhattisgarh’s farmers whose livelihood is dependent on paddy production, Chief Minister Raman Singh has urged Prime Minister Narendra Modi to reconsider his directive to stop bonus on paddy procurement. Chhattisgarh recently distributed a record Rs 2,400 crore bonus on 80 lakh MT paddy it had procured from farmers in the state. The bonus was over and above Rs 13,000 crore given to farmers as MSP amount.

In his letter to Modi last month, Singh cautioned that withdrawing bonus will “reduce buffer stock” and “adversely impact the overall food security scenario of the country”. In his letter, accessed by The Indian Express, Singh pointed out that since the bonus is paid by the state, it should be left alone to decide about it.

Among the first major steps taken by the Modi government after coming to power was to direct all states to end bonus on paddy and wheat procurement. In a June 12 letter to Chhattisgarh’s then Food Secretary Vikas Sheel, U K S Chauhan, the Joint Secretary, Union Ministry of Consumer Affairs Food and Public Distribution, wrote that “bonus by the state government distorts the market of the concerned commodity and drives private buyers out of the market in the state”. He cautioned if the state gives bonus, the Centre will limit procurement for Central pool only up to the requirements of PDS and other food-related schemes. Earlier, the UPA government lifted the entire paddy procured by a state.

Chhattisgarh today pays Rs 300 bonus per quintal, the highest in the country. Owing to the bonus, its paddy procurement has increased manifold from just 4.6 lakh MT in 2001 to 80 lakh MT in 2013-14.

In his letter to Modi, Singh noted that among the measures taken by his government to improve the condition of farmers in the state, “the most important is the decision to give Rs 300 bonus”. Singh pointed that “bon-us was a promise made by the BJP during November 2013 assembly polls,” but the “Centre changed its policy of procurement”.

Singh noted that 80 lakh MT paddy gives 54 lakh MT rice and since the state needs only 24 lakh MT rice for its PDS, it will be left with a “surplus of 30 lakh MT”.

He pointed out that “if FCI does not procure this rice in Central pool, the state will suffer huge losses”. “A change in policy like this may result in significant reduction of cultivation of paddy”, “reduce buffer stock” and “adversely the overall food security scenario of the country,” he noted.
Singh emphasized that the state pays bonus from its resources and “the only support needed from Government of India is continued procurement of rice in central pool”.

With a population just around Delhi, Chhattisgarh is not only the third highest contributor state of foodgrains to the Central pool, it also has a significant share in the Central food subsidy bill.

This year, the state pumped Rs 15,400 crore (Rs 13,000 crore MSP amount and Rs 2,400 crore bonus) through paddy procurement in rural market — over 25 per cent of its annual budget. After making bonus an election plank, the state cannot afford to terminate it abruptly either. Almost all major leaders in Chhattisgarh’s BJP want the Centre to rethink its stand on bonus. Before writing to Modi, Singh had also written to Union Minister of Food and Public Distribution Ramvilas Paswan in July on the issue. Modi and Paswan are yet to respond.

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