Successive years of record food grain production have left government warehouses saddled with tonnes of grain far in excess of the requirement. According to official estimates in early June, the government had about 65 million tonnes (mt) of grains in its warehouses, but its total storage capacity was estimated at 63 mt. The Food Corporation of India (FCI), the government’s nodal agency for procurement storage and distribution of grains is responsible for ensuring that not only the grains are stored in proper manner but also that its distribution to consuming states is orderly. Its Chairman and Managing Director Siraj Hussain tells Sanjeeb Mukherjee that poor offtake by states is primarily responsible for space scarcity for storing grains. He says by the end of the 2011-12 financial year, the country should have the required storage capacity. Excerpts:
How good or bad is the current grain storage scenario in the country?
Well, as on early June, we had food grain stocks of around 65 mt, while cumulative storage available with FCI, state warehouses and others totalled almost 63 million tonnes. This means more than 90 per cent of the food grain available in the country is kept in scientific facilities.
Why do you think we have this space scarcity in storage?
One big and most important reason is the low offtake of additional grains by states allocated by the government. Look, the corporation works on the philosophy of input and output. This means grains come by way of procurement, so it is offloaded by way of regular PDS (public distribution system) allocations.
But if one side is not working, then is creates a huge storage. In short, FCI suffers because of low offtake by states. For example, in May, the government had made a special ad hoc allocation of 3 mt wheat and rice to the states. Of this, 40 per cent was lifted during the validity period which expired in December 2010.
Similarly, in January, a special additional ad hoc allocation of 2.5 mt of grains was done, of which just 21 per cent was lifted till the expiry of its validity period in June. Lifting of ad hoc allocations is poor not only for above poverty line families, but also for those below the poverty line it is not up to mark.
So, how do you manage to tackle that?
Well, we have written to the states to improve their lifting so that the space is created for storing new grains. Also, we try and shift as much grains from producing states to consuming states at the earliest, for which support from the railways has been mobilised to ensure that additional storage space is created at a fast clip.
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What is the procurement level this year, particularly of wheat?
For wheat, our procurement this year is expected to be almost 27.9 mt, which is an all-time-high record, and for rice as on June 28 this is almost 31.28 mt.
The country is gearing up for the Food Security Bill, which will entail upping the annual grain procurement to almost 65-70 mt annually, from the current level of 55-60 mt. How will storage capacities be created for this?
Well, we have embarked on an ambitious programme to create an additional storage capacity of over 15 mt in the next couple of years, of which almost 4 mt will come into operation by the end of this financial year. So, currently we have a storage capacity of around 63 mt and by the end of this year, it will rise to almost 67-68 mt. Hence, we are well prepared to meet the requirements under the proposed Food Security Act.