To fight price rise, Centre will double pulses stock

In a bid to control the rising prices of pulses, the Central government decided on Monday to more than double its buffer stock to 20 lakh tonnes at an estimated cost of Rs 18,500 crore. The move will also encourage farmers to cultivate more pulses. The government could sell pulses from the buffer stock in case of price rise in retail markets.

Assuring that the prices of essential items would be kept under control, the Centre warned that it could cap retail prices using its powers under the Essential Commodities Act.

The decision to raise the size of buffer stock to 20 lakh tonnes from eight lakh tonnes was taken by the Cabinet Committee on Economic Affairs (CCEA), which met under the chairmanship of Prime Minister Narendra Modi.

Briefing the media later, food minister Ram Vilas Paswan said that the government would import 10 lakh tonnes of pulses and procure the remaining from local markets for the buffer stock.

The minister said the stock limit on pulses will not be lifted, and the export ban and zero import duty regime would continue.

“We will provide pulses to the poor at cheaper rates. We will not allow prices of essential commodities to rise,” he said, adding that the government was keeping a close eye on the prices of pulses, wheat and sugar.

Mr Paswan said the prices of pulses had started declining and would fall further in the next two months.

FCI, Nafed and SFAC will undertake domestic procurement operations at the prevailing market price if it is above the minimum support price (MSP) and at MSP, if otherwise.

Import of pulses will be undertaken through government-to-government contract and/or spot purchase from the global market through designated public sector enterprises.

The allocation of pulses from the buffer stock will be made to states and central agencies. Pulses will also be released through open market sales.

Pulse output fell to 16.47 million tonnes in 2015-16 crop year from 17.15 mt in the previous year. Production had remained low in the past two crop years due to drought, resulting in a spike of retail rates.

Retail prices have fallen in the last few weeks and are currently in a range of Rs 115-170 per kg across major cities.