Monday, May 11, 2015

Dilution of grain quality standards -Its impact on food scenario in India

The Minimum Support Price ( MSP) scheme offered by the Government for many commodities is to counteract the depressing market prices often manipulated by middlemen working in rural regions fleecing the farmers, especially when there is a production glut. Quality standards are in vogue based on which procurement operations are done. Many pundits feel that if India has achieved self sufficiency in food grains with enough quantities in the granaries for ensuring long term food security, these MSP programs are to be applauded. It is another matter that Food Corporation of India has been finding it difficult to manage the logistics of storage with a part of the procured grains becoming unfit for human consumption. Here again there is a raging debate whether silo storage or gunny bag storage is more suited to Indian conditions with both sides having their own points for justification. What stands out in this debate is that government, who ever has been ruling the country, could not do much to save grains going rotten inviting condemnation even from the Supreme Court of the country!

One often wonders what would have happened if there was no MSP program in India? Will the production base shrink? Will there be unbearable price escalation in the grain market? What would be its impact on the Public Distribution System (PDS)? Would there be more farmers' suicides? Will there be large scale starvation? Will the farmers abandon agriculture and increase the already high rate of urban migration?  Very difficult questions to answer! During the current year government diluted the food grain quality marks to accommodate offerings from farmers in some states where there were unexpected weather contingencies in the form of nonseasonal rains which are supposed to have damaged the harvest. It is a moot point whether such standards are to to be meddled with for the sake of convenience from time to time. Where is the sanctity for National Food Standards? Can government relax the provisions of food safety regulations allowing private traders to indulge in adulteration because of this situation? Again difficult to get a clear answer. 

Another dichotomy in the system is that government has quality standards for buying from the farmers but is least concerned with what happens to these grains after procurement and storage for years together before distribution at the PDS out lets? It is common knowledge that most consumers who depend on PDS supply for their survival find it hard to use these sub-quality grains unfit even for feeding animals!
Tragically food safety inspectors seem to have been "instructed" not to "touch" the so called ration shops for quality checking in the national interest! Accountability is a non-existent word in the dictionary of those handling food grains in this country, with all of them going scotfree for negligence, callousness and dishonesty in depriving the citizen of wholesome foods! The political gimmick now being enacted in the name of Food Security Act probably will worsen the problem further because of increased burden in procuring adequate grains for supply to the "entitled" citizens. Giving cash in lieu of entitled grains through jan dhan banks is another gimmickry because government is going to give to the deprived consumer cash, equivalent to the MSP price of these grains. In to day's market where rice and wheat are sold at prices varying from Rs 35 to 60 per kg, how much grain can be bought? Will it extinguish the fire in the tummies of poor and famished due to hunger?    

How is the government going to use the food grains procured during the current year? Is it legal to supply them under the Food Safety Act? Food Corporation of India (FCI) generally follows a practice of 'First In First Out' (FIFO) using the freshly procured to replace old stocks which are channeled into PDS. However the wheat currently being procured is not in a condition to be stored for long. According to experts most of the grain procured suffer from lustre loss, which is supposed to make it vulnerable to pest attacks, and thus long term storage of the crop is highly risky. FCI is supposed to supply food grain mostly consisting of rice and wheat to PDS from the previous stocks, while the new crop being procured is stored for about 2-3 years before routing through the distribution channel. .FCI supplies around 22 million tonne of wheat annually to the PDS. but this time the procurement is targeted to be 30 million tons for operationalizing the food security act. This has made the Government to relax the quality standards and pressure from Haryana, Uttar Pradesh, Gujarat and Madhya Pradesh,has further compounded the problem resulting in compromising with grain quality. Of course some minor value cut equivalent of around Rs 3.63 per quintal from Rs 1450 per quintal minimum support price was imposed on the grains not adhering to the food ministry's revised quality norms. The purpose of relaxing norms was to ensure that farmers in key wheat growing states could get almost the entire MSP for the wheat sold to FCI and state-owned agencies, irrespective of quality.

A relevant question that begs for an answer is the dynamics of management FCI has in mind to segregate the procured wheat this year so that they do not get mixed up with the existing stocks in warehouses from where PDS outlets get their supplies. How far the new policy of sending the freshly procured directly to the PDS outlets will affect the quality of the existing stocks some of them nearing their expiration period is an important question. Of course one has to sympathize with the current government which inherited such a chaotic system with no long term vision in mind and "managing" during the last few decades almost on a fire fighting mode! Probably it may be time to rethink these issues more deeply and evolve a long term policy for managing the food grain market in the country.



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