The Indian government has barred states from bidding for federally held food grains when it launches staggered auctions to sell 1.5-million tonne wheat in June, Hindustan Times reported. Further the Indian Government will also impose a similar restriction on an undisclosed amount of rice grains.
According to the report, India’s federally held food stockpile stands at 72.5 million tonne. Notably, this also includes a huge surplus from the production.
The Central government has cited their decision to stop states from bidding as an anti-inflation measure.
The Union government’s decision to exclude states from the auctions follows a move on 13 June to stop all sales to states from federal stocks held by the Food Corporation of India (FCI), the Centre’s main grain-handling arm.
The Hindustan Times report cited the a person familiar with the development who said that the decision to bar states was taken in discussion with several ministries.
“As there is a need to maintain sufficient stocks for market intervention and control prices of wheat and rice through OMSS, therefore, the sale of wheat and rice under OMSS for state governments may be discontinued,” said the recommendation of the panel headed by the Union home ministry. OMSS stands for open market sales scheme.
The Indian government is set to distribute free grains to 800 million beneficiaries under the National Food Security Act 2013. “So, the government’s decision to discontinue the sale of wheat and rice under open market sale is aimed at protecting the rest of the consumers from food inflation,” the official added.
Exceptions
The Indian government has however, decided to continue the sale of rice for northeastern states, hilly states and states facing law-and-order situations and natural calamities at an existing rate of ₹3,400 per quintal (100kg).
The central official also told Hindustan Times that the Union food ministry had already imposed restrictions for sale of wheat under “open market sale to states for a quantity up to 10,000 only”, the person said.
Opposition states in a bind
States helmed by parties in opposition to the Bhartiya Janata Party (BJP) have condemned the move by the Centre and raised objections. One of the most prominent to do so is Karnataka Chief minister Siddramaiah.
The Karnataka CM said that FCI deciding not to sell rice grains to Karnataka, was Centre’s move to disrupt the state Congress government’s Anna Bhagya scheme or free rice supply scheme to families under the Below Poverty Level (BPL).
While Karnataka scrambles to find an alternative, The Tamil Nadu government is trying to purchase 50,000 tonnes of rice from government agencies other than FCI.
Meanwhile, the Kerala government’s is planning legal steps against the Centre’s food distribution policy’ reported The Hindu.
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Updated: 19 Jun 2023, 06:47 PM IST