New Delhi: A Biju Janata Dal (BJD) Parliamentary delegation from Lok Sabha and Rajya Sabha today met Piyush Goyal, Union Minister for Consumer Affairs, Food and Public Procurement and placed demand through memorandum on pending food subsidy of Odisha, evacuation of surplus rice and gunny bags shortage issue of the State.
In the memorandum, the BJD delegation highlighted that paddy/rice procurement operations under MSP programme is a task which is in the domain of Government of India. However, in order to extend the outreach of MSP to remote, far-flung and inaccessible areas, Government of Odisha took over in 2003-04 the responsibility of procuring paddy from farmers in the State.
Thus, Odisha became a Decentralized Procurement State, which means the State undertakes paddy/rice procurement operations on behalf of Government of India on payment of MSP to farmers.
As per MoU with Gol there has to be zero financial liability on the State Government/State procuring agencies with regard to permissible items of cost for procurement of rice to be borne by Gol. The anticipated cost is required to be released in the form of advance subsidy at the rate of 90% of admissible claim on quantity basis in the first month of every quarter.
Further, the State Government/Odisha State Civil Supplies Corporation (the State agency responsible for procurement) shall be paid quarterly provisional subsidy after deduction of the advanced amount. However, the release of advance and provisional subsidy to Odisha is irregular.
Odisha State Civil Supplies Corporation, the major procuring agency of the State Government, is to receive Rs. 5365.11 Crore as provisional subsidy and advance subsidy of Rs. 716.34 Crore. The additional interest incurred because of delay in release and non-release of subsidy comes to around Rs. 4883.55 Crore which remains un-recouped and should be paid by Gol.
The paddy procured by the State Government/State agency is milled to rice through private millers and the rice so milled is distributed under National Food Security Act, Other Welfare Schemes of Government of India and our own State Food Security Scheme. As per MoU the surplus stocks of rice which is in excess of allocation in favour of the State under Targeted Public Distribution System and Other Welfare Schemes are handed over to FCI.
As it is evident from the following table, though paddy procurement has been increasing over the years, the evacuation of rice by FCI has not registered a commensurate and consistent increase.
Figure in Lakh MT
This indicates that increased procurement may not necessarily result in increased delivery of surplus rice to Central Pool through FCI. Failure to ensure timely evacuation of surplus rice from the State by FCI has serious implications of choking State’s godowns, of preventing timely receipt of rice from millers and being saddled with unwanted rice for which there will be no takers. This has financial implications of thousands of crores of rupees for the State.
As per norms, the Jute Commissioner, Government of India is to supply the required gunny bales to the State. The entire funds are placed with the Jute Commissioner. As against the requirement of 2.10 lakh gunny bales for the year 2020-21, only 1.37 lakh gunny bales have been received so far resulting in the deficit of about 73000 gunny bales when flow of funds is not a problem. Even though Gol has allowed use of once used gunny bags but those are not sufficiently available and hence cannot meet the deficit of 73,000 gunny bales.
As per the recent plan received from Gol, there is no further provision for supply of gunny to the State in the current KMS 2020-21 which may hamper the receipt of rice from custom millers and may adversely affect the PDS operations.
Government of India has also agreed to State Government’s proposal of allowing HDPE bags to the extent of 25,000 bales but yet to approve State proposal of receiving boiled rice in them and making exception to FIFO principle to issue this rice so that the longer storage does not damage the quality.
In view of the above context, the BJD delegation urged the Union Minister to address with a sense of sympathy and urgency the issues put forth above for smooth paddy/rice procurement operations in Odisha.
The Union Minister assured that he would do the needful.
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