Centre directs Punjab, Haryana to make online MSP payment from next season

Centre plans to monetize assets of Food Corporation of India and Central Warehousing Corp, says union minister Piyush Goyal

Amid the ongoing farmers protest lead largely by Punjab and Haryana farmers, the Central government today said that it has directed both the states to ensure online payment to farmers through the electronic mode from the coming procurement season.

The wheat procurement season for FY22 will start in the next few weeks. The procurement is done at the Centre-fixed Minimum Support Price (MSP).

In a presentation made by the Ministry of Food and Public distribution and Consumer Affairs, the government said that the process of bio-authentication of farmers bringing their produce for procurement by state and central agencies has been started in Uttar Pradesh, wherein states such as Odisha, Chhattisgarh and Madhya Pradesh have shown interest in replicating the model.

Both the measures are ostensibly meant to cut down the role of middlemen in procurement of cereals and foodgrains by state and Central agencies, although none of the officials, including Minister of Consumer Affairs, Food and Public Distribution Piyush Goyal, have overtly said so.

The minister was highlighting the achievements of departments of food, civil supplies and consumer affairs in the last one year and also explain the provisions related to FY22 Union Budget for them.

Goyal, meanwhile, also said that the Central government at present does not have any proposal to raise the Central Issue Price (CIP) of wheat and rice sold through the ration shops under the National Food Security Act (NFSA). CIP is the rate at which the grains are sold through the ration shops and under the Act has been fixed at Rs 3 per kg for rice, Rs 2 per kg for wheat and Rs 1 per kg for coarse cereals.

The Economic Survey tabled in Parliament recently had advocated raising the CIP of wheat and rice to lower the food subsidy burden which has risen sharply in the last few years.

The government said that among the various reform measures being planned for the Food Department, the Central government has plans to monetize the assets of Food Corporation of India (FCI) and the Central Warehousing Corporation (CWC).

Both the Corporations will strive to mobilse private investments in new and modern storage facilities, the presentation showed.

“We have engaged the Centre for Good Governance to look at the entire structure of the Food Corporation of India and give suggestions to improve its working and the report is expected from them soon,” Goyal told reporters.

He said the Warehousing Development and Regulatory Authority (WDRA) will also be strengthened in the months to come.

Goyal said that Centre is committed to strengthen the mandis and for which the Budget has expanded the electronic-national agriculture market (e-NaM) scheme and also included mandi storages under the ambitious Agriculture Infrastructure Fund (AIF) of Rs 1 lakh crore.

On food prices, the minister said that prices of most commodities have come under control. He said despite allowing larger import of potatoes to cool down rates, the prices have come down despite not much imports being taken.

On mounting sugarcane dues, the minister said that much of last year’s dues have already been settled and even for this year the dues are getting cleared regularly and more momentum will come once mills start exporting sugar with a subsidy which will get transferred into the bank account of farmers.

He said that FY22 Budget had made provision of Rs 4,150 crore for various sugarcane schemes, which is more than three times higher than the Rs 1,270 crore made in Budget Estimates of FY21.

Also, steps are being taken for diversion of excess sugar and utilization of foodgrains to ethanol for blending with petrol, which will help in timely payment to sugarcane farmers.