Food Min urges states to expedite lifting of PDS grains

Food subsidy for FY13 now estimated at Rs 91,213 cr, 22% more than Budget estimate

To expedite liquidation of excess foodgrains stocks, food minister K V Thomas has written to all state chief ministers to ensure full lifting of the foodgrains allocated by the Centre for distribution through the Public Distribution System (PDS)  and to ensure that the grains reach the targeted beneficiary.

He also said that the government is expected to bear a food subsidy of Rs 91,213 crore in 2012-2013, almost 22% more the Budget estimate of Rs 75,000 crore because of the extra grain allocated to states so far in this financial year.

Thomas in his letter also said that states should also strive towards making the Fair Price Shops (ration shops) viable by increasing the margin and allow sale of non-PDS items for daily use as per local requirement.

As on October 1, 2012, the government has over 66 million tonnes of foodgrains in its warehouses, of which wheat stocks are estimated to be around 43.1 million tonnes, while rice stocks at 23.3 million tonnes. This is more than double of the required quantity.

As per the government’s own buffer stocks and strategic reserve norms, the total foodgrain stocks in the central pool should be around 21.2 million tonnes as on October, of which wheat inventories should be minimum 14 million tonnes, while rice at around 7.2 million tonnes.

The stocks though as of October 1, 2012 are within the available storage space of almost 68 million tonnes, with both state governments and Food Corporation of India (FCI), but it might be inadequate when rice procurement starts in full swing.

The government has targeted to purchase around 40 million tonnes of rice from farmers in 2012-2013, almost 5 million tonnes more than the 2011-2012 actual procurement.

In his letter to the CMs, Thomas said that the government has allocated 6.76 million tonnes of extra foodgrains to states for distribution to the states, over and above the usual allocation of almost 50 million tonnes.

To stop the food subsidy budget from further spilling over the Budget estimates, the government has urged all states to expedite the lifting of foodgrains allocated normally and also extra.

In India, government sells cheap foods to over 6 crore Below Poverty Line (BPL) and around 11 crore Above Poverty Line (APL) families.

The food is distributed at cheap rates through a network of almost 500,000 rations shops spread across the length and breadth of the country.