K V Thomas, food and civil supplies minister, takes independent charge of the portfolio at a time when food inflation is proving to be a vexed issue for policymakers. He also has reasons to be concerned at the seeming deadlock over the proposed food security bill, a showpiece welfare scheme of the UPA II government. He speaks to
Nistula Hebbar on these issues and more ….
Let?s first visit the idea of a direct cash transfers with regard to food security, which has been recommended by Nitish Kumar and Sheila Dikshit. What is your opinion?
Well, Bihar has a Public Distribution System which is a bit impaired, so this system may work there, and Delhi is a tiny state, where it could be easier to track such system. The basic problem in direct cash transfer is the fact that it doesn?t account for what to do with Food Corporation of India (FCI) and the work that it does. We will have to then not only dismantle the entire government procurement and storage structure, but also forfeit the government’s options in terms of intervening in prices of essential commodities if it shows undue volatility. Through government procurement we protect the interests of the farmers as well.
The Food Security Bill seems to have reached a dead end because of the differences between NAC and the Rangarajan panel on entitlements and benefits. How soon can we see it tabled in Parliament.
First, I don?t find any differences in the NAC draft and the recommendations of the Rangarajan committee. NAC has designated priorities as Rs 2 per kg for wheat, Rs 3 per kg for rice and Re 1 per kg of millets, for BPL catergory which does not differ significantly with the Rangrajan committee?s estimates either. Where they do differ is on the question of allocations for APL where the latter is more stingy than the former. As for the bill being tabled, I don?t think it will be tabled in the Budget session, and my priority frankly is that whenever the Cabinet passes the bill, my implementation machinery should be in place.
The recent rise in prices is also linked to a large extent on the shortage of storage facilities in the country, you had earlier presented a report on how to improve the situation, any progress on that?
We have a PPP system where a 10 year guarantee on income is there. Then we have the Central Warehousing and State warehousing corporations. Currently, though I have suggested a special purpose vehicle (SPV) to attract investment to this sector, my estimate is that we need around Rs 8,000 crore investment in this sector.
What are your other, more immediate measures to fight inflation and rise of food prices?
Very clearly, we have to listen more to our reporting system. To anticipate shortages and to disincentivise exports of items which we think will be prey to volatility. We have drawn up a list of items which have shown seasonal volatility in the past and we have decided to keep a watch on them and act immediately as when we find that production has been hit. Can?t disclose these items.