Food security

Gov’t enlisting private companies to manage chronic grain surplus

By RJ Whitehead

- Last updated on GMT

Related tags: Cereal, Food

Gov’t enlisting private companies to manage chronic grain surplus
The Indian government is looking at ways to give the private sector greater involvement as its bureaucracy struggles to manage the country’s sizeable grain stocks, according to KV Thomas, the food minister.

Speaking to journalists during the annual general meeting of the Confederation of Indian Industries, Thomas said that food industry groups are working on a means to procure and distribute wheat and rice stockpiles with the help of businesses.

India’s wheat production may total a near-record 92.3m tonnes this year, according to the farm ministry. State stockpiles expanded 27% to 27.1m tonnes at the start of last month. The government plans to boost purchases from farmers to 44m tons over the coming financial year from just over 38m tonnes a year earlier. 

Social commitment

Hence, the government has become the biggest buyer of food grains as private companies have been absent over the last two years from major wheat and rice producing regions​,” said the minister, adding that the situation had to change quickly and insinuating that these companies must shoulder some of the blame.

Because of this gulf between supply and demand, food firms have tended not to buy wheat and rice during surplus harvests, but then ask the government to sell off its surplus at below market rate.

Calling it a “social commitment​”, Thomas said: “You cannot purchase food grains at  below minimum support price rates​."

Ashok Gulati, chairman of the Commission for Agriculture Costs and Prices, called it “a scary situation​” that has come about because “we have stopped proper market operations and driven away private traders​.” 

Fulfil the dream

Subsequently addressing a formal session of the CII meeting, Thomas went on to state that he hoped India would come to be known for its steps to eradicate starvation if the National Food Security Bill is passed by parliament.

He said: “I am sure together we can fulfil this dream. The day is not far off when India will be known the world over for this important step towards eradication of hunger, malnutrition and resultant poverty​."

However, he cautioned that the cost of failure would be intolerable. “If we fail in ensuring a vibrant agriculture in our country, all other developments, be they in industry, science and technology or IT will not help us become the world power that we want to become​.”

Thomas said it was not just up to the Central government but also to the states to make sure that the Bill passes safely through parliament and is implemented.

Tomorrow’s CII session will be opened by Congress general secretary Rahul Gandhi.

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