Centre not to change issue price of grains under food law

National Food Security Act mandates review of subsidised rate after three years from date of commencement, which is July 5 this year

The Centre is not expected to tinker with the existing subsidised rate at which it provides rice, wheat and coarse cereals to beneficiaries under the National Food Security Act for at least another year. The Act mandates that the subsidised rate is to be reviewed after three years from the date of commencement, which is July 5 this year.

Thereafter, the prices are to be linked with the then prevailing Minimum Support Price. Doing so would push these up from Rs 3 a kg for rice, Rs 2 a kg for wheat and Rs 1 a kg for coarse cereals. Till date, 33 of the 36 states and Union Territories have implemented the Act, which provides a legal entitlement for cheap grain to almost 65 per cent of the population at the rate of five kg per person per month. In a related development, food minister Ramvilas Paswan has written a letter to all MPs to convince their respective state governments on full implementation.

As many as 23 of the 36 states/UTs do not contribute anything towards food subsidy; the Centre bears the burden. The other 13 provide some subsidy on grains supplied by the Centre, which further lowers the price.

Paswan in his letter said the total requirement for foodgrain was 54.93 million tonnes a year. At the 2016-17 rates, the Centre takes on around Rs 29 in the total cost of rice, estimated at Rs 31 a kg. Its share in the total wheat cost of Rs 23 a kg is almost Rs 21.