Parliamentary Panel: Share in procurement of FCI has gone down

The Committee on Public Undertakings headed by Jagdambika Pal on 10 February 2014 placed its report in Parliament on the share of procurement by Food Corporation of India (FCI). Share of Food Corporation of India (FCI) procurement is gradually coming down in both percentage and quantity terms said the Parliamentary Panel.

In its comment the Panel mentioned the data of different crops that has gone down and they are
• Wheat share has declined from 53 lakh tonnes in 2008-09 to around 40 lakh tonnes
• Paddy (in terms of rice) has down from 18 lakh metric tonnes in 2006-07 to 3 lakh tonnes in the year 2011-12

The examination of the FCI by the Committee revealed that the agency has loosened its procurement activity with the introduction of Decentralized Procurement Scheme in the year 1997-98. The committee in its report has also recommended a need to augment procurement of food grains with the enactment of Food Security Act. FCI has been urged by the committee to play its due role effectively and expand its procurement activity and maintain its procurement share in procurement.

In its recommendation it has also suggested FCI to set-up more procurement centers to make sure that the farmer doesn’t gets engaged in distress sale. The estimated cost to implement the law will cost around 130000 crore rupees to the government and it will require at least 62 million tonnes of food grains. The panel has also suggested FCI to take actions on immediate basis to plan better about the storage capacity. At present the existing norms to stock maximum foodgrain by FCI is 26 million tonnes, which has not been revised since April 2005.

Background
The panel report in its recommendation has suggested to FCI to augment its procurement activities for successful and positive implementation of the Food Security Law, which has been created with an aim of providing legal right over highly subsidised foodgrains to 67 percent of the population. The law was passed by the Parliament in September 2013 and at present is being implementation in 10 states.

About Food Corporation of India (FCI)
Food Corporation of India (FCI) is a nodal agency of the union government that procures and distributes food grains on the behalf of government. It was created under the Food Corporation’s Act 1964 to fulfill the objectives of food policy, which are
• Effective price support operations for safeguarding the interests of the farmers
• Distribution of foodgrains throughout the country for public distribution system
• Maintaining satisfactory level of operational and buffer stocks of foodgrains to ensure National Food Security

Since its inception, FCI has played a significant role in India's success in transforming the crisis management oriented food security into a stable security system.