CACP trashes food Bill, says farm sector to be hit

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ENS Economic Bureau: New Delhi, Dec 22 2012, 01:41 IST

Even as the government readies to bring out a Food Security Bill (FSB) by the next Budget, the head of the Commission for Agricultural Costs and Prices (CACP) has come out with a striking critique of the programme. The jointly authored study is posted on the CACP’s website while saying the views are those of the authors and not necessarily of the organisations they work for.

Apart from saying the FSB will likely cost double the Rs 95,000-120,000 crore the government estimates it will cost each year, CACP chief Ashok Gulati and his co-authors point to other major lacunae in the Bill. At the outset, they wonder why, when the government is working on Aadhaar-based cash transfers to take plug huge leakages in most government programmes, it should be looking at expanding the existing PDS in such a massive manner.

While FCI is already groaning under the burden of the current levels of procurement (around 50-55 million tonnes pa) and doesn’t have the space to store the grain, the FSB will require FCI to procure around 25-30 per cent more. Right now, while FCI has around 80 MT of grain, it only has covered or pucca storage facilities for 45 MT; another 17 MTis kept under tarpaulin on raised blocks, leaving the rest in the open fields. As it is, Gulati argues, FCI and state government procurement is edging out private trade from major grain markets, the FSB will only make things worse.

The paper has a lot worse to say

... contd.

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