The Centre has decided to release immediately around 10 million tonnes of foodgrains for distribution to the poor, to make space in government granaries for fresh arrival of rice and wheat from what is expected to be a bumper rabi crop.
Sources in the Food Ministry said there would be no change in the issue price of the foodgrain stock that would be pushed into the public distribution system. At a recent meeting, an empowered group of ministers (EGOM) on food chaired by Finance Minister Pranab Mukherjee decided to distribute 10 million tonnes of foodgrain to the states to enable them to distribute to people coming under below-poverty-line (BPL) group.
The government expects a substantial increase in procurement due to the bountiful rabi harvest. The glut in the yield this year has placed the government in a fix as wheat procurement may hit an all-time high 75 million tonnes against the current storage capacity of 63 million tonnes. Unless the stocks are released immediately, the government may be forced to store the grain in “kutcha plinths,” the method of storing wheat in the open with plastic sheet covering becomes unsatisfactory during rain.
Estimates show that total foodgrain production in 2011-12 will be 251.42 million tonnes, with rice about 102 million tonnes and wheat 88 million tonnes.
As the Centre is working on the National Food Security Bill, which will give legal entitlement of foodgrains up to 70 per cent of the country’s population, the government requires around 62 million tonnes of foodgrains to meet the target.
Pranab Mukherjee had said in the Budget speech that the government, with help from private entrepreneurs, was building an additional 15 million tonne capacity facilities in 19 states to address the problem of food storage. Three-million tonne capacity would be added by the end of 2011-12 and five million the next year.
