Govt decides to partially restore wheat entitlements of PDS beneficiaries, open market sales uncertain

Posted on by

The government has decided to partially restore wheat entitlements of beneficiaries under the Public Distribution System (PDS) by allocating 35 lakh tonnes (lt) of the grain until March 31, which may benefit at least 20 crore people to get 5 kg of wheat, each every month. The new allocation will be implemented from October.

Briefing media about 100 days achievements of the government, food secretary Sanjeev Chopra said the government has decided to increase the current annual allocation of wheat by 35 lt to PDS beneficiaries as part of restoration of earlier entitlements, which were cut in 2022 and adjusted with a similar quantity of rice following a big drop in wheat procurement.

Currently, the FCI needs 184.6 lt of wheat annually to meet the obligation under the food security law and other welfare schemes. After this restoration, the wheat allocation will rise to 220 lt, but still short of 28 lt in terms of allocation. Before the wheat allocation was reduced and compensated with the same quantity of rice, the wheat allocation was 248 lt, whereas offtake was 217 lt in 2021-22.

Under the National Food Security Act (NFSA), which covers 80 crore people, each beneficiary is entitled to receive 5 kg of foodgrain every month. The government decides the quantity of grain – how much rice and wheat – based on its stock position. For instance, if a beneficiary was earlier taking 5 kg of wheat, in some states he/she was given 2 kg of wheat and 3 kg of rice when the Centre decided to reduce wheat allocation.

The food secretary further said that wheat prices are stable and there is no shortage as the country had a bumper output last year. He ruled out any necessity to start open market sales of wheat for now, to flour millers saying none of the three parameters is breached. The third parameter is overflowing stock with the government which is also not the case now, he added.

Chopra hoped that food prices would be stable in the festival season. He cited the pro-active step of the government to meet with edible oil representatives wherein, it was conveyed that the edible oil prices should not be raised immediately after the hike in import duty last week. He said more than 13 lt of imported edible oils were in stock in India, before the import duty hike was effected. “Even after this stock exhausts, the prices need not rise by 20 per cent,” he said adding global prices have come down slightly.

“We have been able to maintain prices at a reasonable level for consumers,” Chopra said at the press conference. Effective from September 14, the government raised the basic customs duty on crude form of soyabean oil, palm oil, and sunflower oil to 20 per cent from nil. The duty on their refined variants was increased to 32.5 per cent from 12.5 per cent.

Chopra also said that the government has approved a ₹1,000-crore credit guarantee plan under the electronic negotiable warehousing receipts (e-NWR) that will facilitate banks to disburse credit against crops. He said there is a potential of taking e-NWR credit to over ₹1 lakh crore in 10 years from ₹3,900 crore achieved in 2023-24.