RBI extends, revalidates wheat cash credit limit in Punjab

The Reserve Bank of India (RBI) has extended the cash credit limit of the Punjab government’s food credit account till May 31. The state’s wheat procurement ends on that date.

According to a statement issued by the Punjab government, RBI on Wednesday “revalidated and extended the validity period of the authorisation of Rs 17,523 crore as cash credit limit till May 31 for the wheat crop of the Rabi 2016-17 season in the state”.

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Punjab’s Food & Civil Supplies Minister Adesh Partap Singh Kairon said here on Wednesday that this would help release the dues of farmers, commission agents and other stake holders of the wheat procurement programme.

SEPARATing WHEAT FROM CHAFF

• RBI extended validity of authorisation of Rs 17,523 cr as cash credit limit for wheat crop of the rabi 2016-17 season in Punjab till May
   
• State agencies, FCI and private traders have procured 10.8 million tonnes of wheat till date, of which 8.4 million tonnes has already been lifted

According to farmers, they have received payments for the crop procured till April 21-22. The payments for direct procurement by the Food Corporation of India (FCI) are faster than that done by state agencies.

According to the state food department, Rs 5,938 crore had already been released to the farmers and commission agents in April.

The minister said the procuring agencies of the state, FCI and private traders have procured 10.8 million tonnes (mt) wheat till date, out of which 8.4 mt of wheat have already been lifted. According to Punjab Agriculture Produce Markets Act, the entire procurement has to be lifted within 72 hours of procurement.

Last month, RBI had found that food stocks worth Rs 20,000 crore were missing from the warehouses in Punjab and banks had refused to extend the cash credit limit until this issue was resolved.

The Punjab government denied the reports of missing food stocks, saying the carrying and handling charges, and other miscellaneous expenses of the state had not been adjusted by the Centre for past many years and this accumulated outstanding receivable were accounted as outstanding dues.