Now, free grain from your favourite MP

Today, the country holds foodgrain stocks of 43 million tonnes against the recommended buffer stock norms of 24 million tonnes.

Shanta Kumar’s proposal will cost the country anywhere between Rs 450 to Rs 545 crore, based on the cost of this foodgrain.

“After all, MPs have been saying that the Rs two crore sanctioned to them as funds for their constituencies is not enough but the Finance Ministry is not willing to raise this ceiling due to lack of funds. Since we gave excess foodgrains, why not give them this grain which will actually benefit poor people in the area and also generate employment through MPs’ schemes?” justifies Food Minister Shanta Kumar in an exclusive interview to The Indian Express.

“The cost of 2,000 tonnes grains at the the MPs’ disposal would be around Rs 75 lakhs to a crore, and the government can actually count this as raising of financial limits for the MPs’ funds,” says Shanta Kumar.

The cost not being important for the moment as the government granaries overflow, what will make the Food Minister happy is the fact that it will empty out 11 lakh tonnes of grains from the Food Corporation of India’s godowns which are required to be filled in with paddy, which is already being harvested an procurement for which is slated to commence from September 21.

Apart from this way to empty out the granaries, Shanta Kumar also proposes to export foodgrains. It is proposed that the cost of storing this grain be reduced from the final export price, as this is the only way to make the prices internationally competitive. “And considering we will save the carrying costs for storing this grain which would have to be stored for the next two years at least, this should be subtracted from the export price,” states Shanta Kumar.

The economic cost of wheat is calculated as Rs 9,000 per tonne and that of rice as Rs 11,800 per tonne. As per Shanta Kumar’s formula, if carrying costs of Rs 2,000 per tonne is reduced from this, wheat would be sold at Rs 7,000 per tonne and rice at Rs 9,800 per tonne.

As a result, with excess grains of nearly 20 million tonnes lying in the country, any effort to reduce stocks appreciably, would mean drain on resources to the tune of Rs 200 crore for every million tonnes of grains sold in the export market.

The minister also wants states to identify the poorest of the poor families in the country – one crore of them, and give them 25 kgs of foodgrains at rates below what is currently being charged from the BPL (Below the Poverty Line) families. “Subject to Cabinet clearance, I would expect wheat to be given to these families at Rs 2 per kg agants the present BPL rate of Rs 4.50 and rice at Rs 3 per kg against the present BPL rate of Rs 5.90,” says Shanta Kumar.

“After all it is better that the poor people eat this grain rather than rats,” he justifies.