Punjab loses Rs 450 cr worth rice to moisture: CAG

"Storage loss in rice observed during the period 2003-04 to 2007-08 in Punjab region as compared to Haryana region was in excess by 3.23 lakh tonnes valuing Rs 450.65 crore," the Comptroller and Auditor General of India said in its report for the year ended March 2009.

During storage rice loses weight due to loss of moisture, CAG noted, while rejecting Food Corporation of India's contention that higher procurement in Punjab was one of the factors that resulted in more storage losses.

It is FCI that procures rice through levy and custom milling for the central pool. CAG said "misappropriation of stocks cannot be ruled out in high percentage of storage loss".
The average storage loss of rice in Punjab region during the period 2003-04 and 2007-08 was 1.02 per cent, whereas in Haryana where the climatic condition was similar, the average storage loss in rice was observed as 0.33 per cent, CAG said.

Stating that FCI has not fixed any norms for the storage loss and the difference of weight between receipt and issue is calculated as the storage loss, CAG asked the government to fix the norms for storage shortages for each depot according to the local condition.

FCI had, in its reply endorsed by Food Ministry, said that "in Punjab, there was more procurement, longer storage period and different storage condition... Its comparison with Haryana region canot be made." It had also expressed its inability to fix storage loss norms due to different climatic condition.

"The reply is not acceptable," CAG said, adding that higher procurement does not imply a higher percentage of storage loss.