Falling stocks hit PDS supplies

The Food Ministry has said it would not be able to meet the full requirement of foodgrains under the targeted public distribution system and...

The Food Ministry has said it would not be able to meet the full requirement of foodgrains under the targeted public distribution system and other welfare schemes due to lower than buffer norm stocks in October 2005. The wheat stocks are at their lowest-ever since 2002.

‘‘Our projections for 2006-7 indicate that even if levels of procurement of wheat and rice remain high, it would be increasingly difficult to meet the full requirements of foodgrains under the TPDS and other welfare schemes with the existing norms,’’ the Food Ministry said in a statement adding, ‘‘At the existing norms and issue prices, there have been studies indicating substantial diversion of foodgrains supplied under TPDS for BPL families as well as foodgrain based welfare scheme’’.

As a result, government proposed bringing down the foodgrain allocation for people above the poverty line (APL) from 35 kg per family per month to 20 kg. However, for people Below the Poverty Line (BPL) Andantyodaya households, the allocation was proposed to be reduce from 35 kg to 30 kg. The APL Central Issue Prices (CIPS) of foodgrain were to be revised upwards by Rs 85 per quintal for wheat and Rs 95 per quintal for rice. The BPL and Antyodaya Anna Yojana CIPS were to be continued at the same level.

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The cabinet decision to bring down food subsidy, announced on January 6, was put on hold by Union Agriculture and Food Minister Sharad Pawar following reservation raised by the Congress and other UPA allies. In addition to the offtake under TPDS, demand of foodgrains under other welfare schemes such as Sampoorna Gramin Yojana, mid-day meal scheme and National Food for Work programme had also registered a sharp increase.

Consequently, the foodgrain stock in the central pool which had peaked to 648 lakh tonnes in June 2002 fell to 151 lakh tonnes in October 2005.

This comprised 48.5 lakh tonnes of rice and 102.9 lakh tonnes of wheat, against the minimum buffer norm of 162 lakh tonne in October comprising 52 lakh tonne of rice and 110 lakh tonne of wheat.

Wheat stocks have further decreased to 62 lakh tonne as on January 1 and are projected to be around 15 lakh tonne on April 1 against the minimum buffer norm of 40 lakh tonne.

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Rice procurement has been good this year and the position as on April 1 would be above the buffer norm of 122 lakh tonnes. It said the food subsidy had increased from Rs 9,200 crore in 1999-2000 to Rs 26,000 crore in the current year, adding if the CIPS are revised upward and scale of issue are not revised downwards the food subsidy may go up further due to increased MSP and other procurement incidentals.