PM Panel Ignores Sonia: Cheap Food Only For Poor

New Delhi
PM Panel Ignores Sonia: Cheap Food Only For Poor
Prime Minister's expert panel on Food Security Bill today disfavoured Sonia Gandhi headed NAC's proposal of legally entitling 75 per cent of population to subsidised foodgrains saying it will not be possible in view of the current availability.

The expert panel, however, recommended "assured delivery of foodgrains at Rs 2 per kg for wheat and Rs 3/kg for rice, to the really needy households and the coverage of the rest through an executive order, with a varying quantum depending on the availability of foodgrains".

The recommendations of the expert committee, which went into the proposals suggested for the National Food Security Bill by the National Advisory Council (NAC), were made public today. The panel is headed by PM's Economic Advisory Council (PMEAC) Chairman C Rangarajan.

The NAC, headed by Congress President Sonia Gandhi, had recommended legal entitlement to subsidised food grains to both 'priority' and 'general' households, covering at least 72 per cent population in phase-I starting 2011-12 and 75 per cent in the Phase-II in 2013-14.

Going by NAC proposal, the foodgrain requirement would be 74 million tonnes upon completion of final phase in 2014, while the total foodgrain availability with the government in 2011-12 and 2013-14 is likely to be 56.35 million tonnes and 57.61 million tonnes, respectively, based on the current production and procurement trends.

"It will not be possible to implement NAC recommended food entitlements for either of the phases," the expert committee, said in its report.

Instead, the committee has suggested legal entitlement to 46 per cent of rural and 28 per cent of urban population, which it said "are the same as NAC recommended 'priority' households".

This captures not only the poor but also some at the margin, the report added.

According to the panel recommendations, the grain requirement will be nearly 52 million tonnes in 2014 and the subsidy will be Rs 68,539 crores and if outgo on other welfare schemes and maintenance of buffer stocks included, the total subsidy would be Rs 83,000 crore.

At present, the government provides 35 kg of food grains to 6.52 crore families below poverty line (BPL) through ration shops. Wheat is provided at Rs 4.15 per kg and rice at Rs 5.65 per kg.

"(The) National Food Security Bill (NFSB) creates a statutory entitlement for the included population and a legal obligation for the government, hence important to mandate enforceable entitlements keeping in mind the availability of grain," it argued.

The panel fears that increasing the current procurement level has "the danger of distorting the food prices in the open market". Besides, it said any hike in support price to boost procurement would raise the "fiscal burden".

It also considers imports as an "undependable" and "high cost option" to meet the foodgrains requirement under proposed food law.

"...The implementation of the entire set of NAC recommendation may have to be calibrated, to prevent the state from being accused of reneging of such an important right," it said, adding that the recommendations of the panel should be seen in this spirit.

The committee pointed out that foodgrains requirement and subsidy outgo projection by the NAC is on the lower side and the same needs to be adjusted for population and grain offtake.

While NAC has estimated foodgrains requirement at 63.59 million tonnes and subsidy at Rs 79,931 crore, the panel has pegged the grain demand at 73.98 million tonnes and subsidy at Rs 92,060 crore.

In its 2009 general election manifesto, the Congress Party had promised to enact a National Food Security Law, under which it would provide 25 kg of wheat or rice per month at Rs 3 per kg to the poor.

A senior Congress leader on the condition of anonymity said there was no difference in principle on the issue, but there were different views on the acceptable limit of the budget deficit for implementing the law.

He said he was hopeful that some middle path would be worked out to resolve the differences between the NAC's proposals on food security and the provisions of the government bill in this regard.

Party spokesperson Abhishek Singhvi merely said, "this is a product in making, a process in pipeline. I am confident that the final decision will be in public interest."
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