Decision comes in the wake of court's concern

In the wake of the concern expressed by the Supreme Court at foodgrains rotting, the Union government on Thursday decided to release an additional 2.5 million tonnes of rice and wheat to the States for distribution to the poor under the Targeted Public Distribution System.

The grain will be sold at Below the Poverty Line (BPL) rates in the next six months.

It was also decided to overhaul the PDS, including upgrading the number of eligible BPL families. The number under consideration is between 7.7 crore and 8.14 crore, depending on which population census they are based. At present, 6.52 crore families are categorised as BPL.

The decisions were taken at a meeting of the Empowered Group of Ministers (EGoM) here.

The meeting, chaired by Finance Minister Pranab Mukherjee, was attended, among others, by Agriculture Minister Sharad Pawar, Deputy Chairman of the Planning Commission Montek Singh Ahluwalia and inter-ministerial senior officials.

The meeting, lasting two hours, went over the court's observations on rotting grain and its remarks that the grain might be distributed free rather than being allowed to rot.

Emerging from the meeting, Mr. Pawar said:

“The government is considering an overhaul of the PDS, including upgrading the number of eligible BPL families. This is expected to increase the number of such families eligible for assistance and corresponding increase in allocation by the Central government.

“As an interim ad-hoc measure, pending a final decision on the issue, the government is releasing an additional quantity of 2.5 million tonnes of wheat and rice to the States at BPL price for the next six months.''

The Minister did not reply to questions about distribution of free grain from the Central pool to the poor.

In the recent months, the Food Ministry had released to the States about six million tonnes for distribution to Above the Poverty Line families and an equal quantum under the open market sale scheme (OMSS) to enhance the availability of grain and keep the prices under check.

However, lifting has been poor, as the rates at which the government allocated grain include acquisition and freight charges. The States have been asking for grain at BPL cost.

The Centre distributes subsidised grain to 6.52 crore BPL families. They are eligible for 35 kg of grain a month.

The current food subsidy bill is estimated at Rs. 66,000 crore.

On August 1, the government had 55 million tonnes of food stocks, against the norm of about 27 million tonnes.