In a significant show of unity, the Centre and states came together cutting across party lines on Saturday calling for drastic changes in the agriculture marketing system in the country. The day-long chief ministers? conference with the Prime Minister, called here to discuss the pressing issue of spiraling food prices, decided to set up a core committee of chief ministers and central ministers concerned, whose one prime responsibility will be to reduce the gap between farm gate and retail prices, long blamed for the spurt in food prices, particularly vegetables and fruits. This is an acknowledgement that an efficient marketing system with active participation of private players could help in reducing the role of middlemen and hoarders.

The panel will also look into and suggest various measures to tame prices, including effective implementation of the Essential Commodities Act to check hoarding, toning up of the public distribution system and augmenting warehousing and storage.

The government?s seriousness in reforming the farm product marketing system was also evident from Prime Minister Manmohan Singh?s observation as he hinted at opening up retail trade in the country, stating that the market required greater competition for a check on prices. ?We need greater competition and therefore need to take a firm view on opening up the retail trade,? Singh told the chief ministers.

The states were also asked to provide timely and accurate data on production and procurement for better management, apart from strengthening their PDS.

?In this context the states agreed to give this subject the highest priority in the coming months. Government of India would give the state governments all requisite support in this task,? a statement released at the end of the conference said.

The core committee will also suggest long-term policies for sustaining agricultural growth, including agricultural production and productivity, besides looking into issues concerning the augmentation of warehousing and storage capacities. Studies show food products worth around Rs 30,000 crore is lost annually in the country for lack of proper storage and cold chain facilities. Better implementation and amendment of the Essential Commodities Act to check hoarding and black-marketing of food products, effective delivery of essential commodities to the vulnerable sections of the society through the PDS and issues related to fertiliser and seeds are some of the other key areas where the core committee will deliberate and suggest measures.

?There is a need to foster a dynamic relationship between the Centre and states to solve this crisis,? the official statement said.

The meeting also decided to set up a National Mission on Pulses to bolster domestic production, which has been stagnant for the last several years. The Prime Minister also pointed out that prices of pulses have risen much more steeply than other food articles.

Sustained increase in minimum support price of food commodities, supply constraints, increase in demand on account of higher purchasing power along with inefficient marketing system was blamed for the surge in food prices, which has pushed the wholesale-price index-based inflation to around 7%, far ahead of RBI?s year-end projections, forcing the Reserve Bank to hike the cash reserve ratio (CRR) for banks by 75 basis points in its last monetary policy review.

The meeting also decided to converge ongoing central and state government schemes for development of agriculture, strengthening the Rashtriya Krishi Vikas Yojana, gearing up the administration for alternative cropping pattern in case of high or low rainfall as in 2009, when the country was hit by its worst drought in decades.

Under attack, Pawar gets PM?s pat

Facing flak from all quarters, agriculture minister Sharad Pawar on Saturday received support from Prime Minister Manmohan Singh for his efforts in controlling rising food prices. In a politically charged meeting of chief ministers with the Prime Minister on rising food prices, Singh drew attention of Pawar?s effort to augment supplies of essential commodities through imports and also the minister?s concern on the growing disconnect between farm gate and retail prices.