CCEA okays 150,000 tonnes of pulses buffer stock

To insulate against any sudden spike in the price of pulses, the Cabinet Committee on Economic Affairs (CCEA) on Wednesday cleared a proposal to create 150,000 tonnes of buffer stock through domestic procurement at market rates.  Of this, 50,000 tonnes would be purchased from farmers during the 2015-16 kharif season, while another Rs 1 lakh tonnes would be purchased from the rabi crop of the same year. 

The Food Corporation of India, National Agricultural Cooperative Marketing Federation of India, Small Farmers’ Agribusiness Consortium and other agencies would be engaged in purchasing the crop from farmers.

The payment for these purchases would be made from the price stabilisation fund created by the government.

“This will encourage farmers to take up pulses production on a larger scale and will enable India to help achieve self-sufficiency in pulses in a few years,” said an official statement.

In 2013-14 (July to June), India produced 19.2 million tonnes (mt) of pulses, which fell to 17.38 mt in 2014-15.

The Centre expects production in 2015-16 to be 18.32 mt, but some people are of the view it might not reach that level and could remain at 17-17.5 mt.

Last month, CCEA had raised the minimum support price (MSP) of masoor and gram, the two biggest pulses grown during the rabi season, by Rs 250 a quintal. The CCEA also recommended a bonus of Rs 75 a quintal over and above the MSP, making the total increase Rs 325 per quintal in masoor and gram.

Earlier, it had increased the MSP of tur, urad and other pulses.

Sometime back, prices of pulses had touched Rs 210 a kg creating a nationwide furore. A worried government immediately imposed stock limit on importers, big processors and traders, alleging the price rise was due to hoarding. The government conducted nationwide raids on pulses importers and seized around 130,000 tonnes of. Thereafter, prices started softening in the retail market.

Of late, the prices have started showing a declining trend. The statement also noted the Department of Agriculture has identified gaps in the present strategy to increase production of pulses and has identified lack of availability of new varieties of seeds as a hindrance to increase productivity of pulses.

OTHER DECISIONS

Mandatory Jute Packaging

The CCEA extended the provision of mandatory packaging of 90 per cent of foodgrains produced in India as well as 20 per cent of sugar in jute bags for the 2015-16 crop season, which started in July 2015. The Jute Packaging Materials (Compulsory use in Packing Commodities) Act, 1987, provides for the compulsory use of jute as a packaging material for foodgrains procured by state-run Food Corporation of India. This is done in the interest of the beleaguered jute sector. Most of the jute sector is located in West Bengal, which goes to polls next year.

Waterways Bill

The Cabinet has given its approval to carry out official amendments in the National Waterways Bill, 2015 to declare 106 additional inland waterways as national waterways. After the inclusion of 106 additional inlands waterways to the existing five national waterways, the total number of national waterways would go up to 111.

Policy on Shipbuilding

The Cabinet approved a policy for grant of financial assistance to shipyards, after delivery of ships, to counter cost disadvantages at the rate of 20 per cent of the contract price or the fair price, whichever is lower. The assistance would be reduced at the rate of three per cent every three years and will be given for all types of ships. This policy will be in force for 10 years with an expenditure of ~4,000 crore.