A day after the Union Food Ministry pushed Punjab and Haryana to make e-payment of MSP directly to farmers from the next procurement season starting April 1, the Centre on Friday asserted this measure wouldn’t affect the current practice of crop procurement through mandis and arthiyas (middlemen).
The government also maintained that no further relaxation would be granted to both states on full MSP payment to farmers through electronic mode.
In Punjab and Haryana, the Centre and state agencies procure their quota of foodgrain largely through a network of mandis and middlemen, which a section of farmers fears, would be badly affected as and when the new farm Acts become effective.
The Centre clarified that in Punjab and Haryana, the practice of e-payment of MSP to farmers has been partially on since 2015-16, but the two have sought exemptions multiple times from bringing the entire system online.
“While the usage of electronic modes to transfer minimum support price (MSP) to farmers is to check diversion and avoid delays, the new system won’t end the current practice of crop procurement through mandis and middlemen, called arthiyas,” the ministry said.
The government claimed the electronic mode of payment would ensure that all participants —including farmers, arthiyas, and mandis —receive their payments directly in a transparent manner.
“The online procurement system ushers in transparency and convenience to farmers through proper registration and monitoring of actual procurement. All states have also been encouraged to procure the produce of farmers online," the statement said.
Through the e-procuring module deployed by procuring agencies, farmers get the latest/updated information regarding MSP, the nearest purchase centre, the date on which the farmer has to bring his/her produce to the purchase centre, etc. Thousands of farmers, mainly from Punjab, Haryana, and western Uttar Pradesh, have been protesting at Delhi borders for over two months now, seeking repeal of the three farm laws and a legal guarantee of the MSP. The three Acts were enacted in September last year.
The Centre also said that it would release nearly Rs 3 trillion more food subsidy in the remaining two months of the current fiscal year to clear all previous backlogs.
"The government has released record Rs 1,25,217.62 crore this year and Rs 2,97,196.52 crore more will be released during this financial year towards food subsidy, of which Rs 1,16,653.96 crore is reflected in PFMS towards Punjab," the statement said. PFMS refers to the Public Financial Module System.
About Rs 24,841.56 crore is reflected towards Haryana.
According to the recent Budget paper, food subsidy rose sharply to Rs 4,22,618.14 crore in the Revised Estimate (RE) of 2020-21, from Rs 1,15,569.68 crore in the Budget Estimate, as the Centre distributed additional foodgrain free of cost to help the poor mitigate the impact of the Covid-19 pandemic.
For the next fiscal year, food subsidy is estimated at Rs 2,42,836 crore.