April, cruel month for J-K ration shops

NEW DELHI, March 27: Come April 1 and the poorest of consumers drawing rations from Jamp;K's Public Distribution System PDS are likely...

NEW DELHI, March 27: Come April 1 and the poorest of consumers drawing rations from Jamp;K8217;s Public Distribution System PDS are likely to face frightening grain shortages. The Food Corporation of India FCI has decided to withdraw its credit facility to the Jamp;K government 8212; the only state to enjoy this 8212; as the state has run up arrears of about Rs 115 crore.

Things wouldn8217;t have come to such a head had the Centre acted on a flurry of letters that were being written from one ministry to the other. The state Government said it didn8217;t have the money and couldn8217;t the Home Ministry bail it out; the Food Ministry said the FCI didn8217;t have the money, the Home Ministry said it couldn8217;t bail out the state since there was no such provision. The principal characters: Food amp; Civil Supplies Minister Surjit Singh Barnala, Finance Minister Yashwant Sinha, state Chief Minister Farooq Abdullah and Home Minister L K Advani.

Finally, on March 15, Barnala decided to withdraw the credit facility and revert to the system ofpre-payment for Jamp;K as is done for other states. He wrote identical letters to Sinha and Advani: 8220;My apprehension is that the state Government is misutilising the credit facilities for meeting its budgetary deficit. This is clearly established because the state Government is apparently not remitting to the FCI the entire realisation after disposing of the stocks to fair price shops. In view of this we have decided to extend the credit facility only for the month of March.8221;

Barnala also asked the Finance Ministry to credit any special allocation made to Jamp;K to the FCI to clear the state8217;s outstanding dues since the FCI was facing an 8220;acute resource crunch8221;.

What apparently sparked off Barnala8217;s final credit withdrawal was Advani8217;s refusal to allow the Ministry of Home Affairs to place a revolving fund of Rs 230 crore with the FCI. In his letter to Barnala, written last November, Advani squarely blamed the Farooq Abdullah government: 8220;The Government of India meets the plan requirements of the state ofJamp;K. As such, the state government should be in a position to settle the dues of FCI8230;it is not possible for us to make any advance payments of behalf of the state government since we do not have any separate funds earmarked for such a purpose.8221;

Following this letter, Barnala wrote to Advani, on January 21, pointing out that that his Ministry had no alternative but to extend the credit facility to Jamp;K for a period of three months in view of Advani8217;s request. But, this Barnala maintained, was not not feasible since it could lead to other states of the Union, particularly the cash-strapped states seeking similar dispensation quoting Jamp;K as a precedent.

In reply, Advani pointed out his inability to set up the fund and sought credit extension since stocks had to be built up for winter. On the same day, Barnala sent an SOS to Sinha pointing out that 8220;winter stocking in Jamp;K was a national priority.8221; He said that the credit was first extended up to January 1999 as a 8220;temporary measure, due to assurancesfrom the Department of Jamp;K Affairs that it was persuading the state government to settle the FCI dues.8221; Barnala said that PDS foodgrains are heavily subsided. And that issue of credit to any state 8220;amounts to diversion of food credit and also adds to the subsidy burden of GOI.8221; Meanwhile, the Farooq Abdullah government which actually sells the wheat, rice and sugar in the PDS and TPDS has been asking the MHA to set up a revolving fund to enable it to clear its dues. In a letter to Advani written on February 18, the Chief Minister says that his state is going through a difficult time, facing 8220;acute financial crunch and is unable to pay its dues.8221; When contacted by The Indian Express, Abdullah declined to comment.