Food stocks reach all-time high but left to rot in the open

Grand plans stuck with PPPs failing to add storage space


Prasanna Mohanty | April 25, 2012

Come monsoon we will have the spectacle of food grain rotting in the open once again. And that is because while the government has failed miserably to add capacity to store, stocks of food grain is increasingly at an alarming rate.

According to the Food Corporation of India (FCI), the stock has reached an all-time high at 53.3 million ton (MT), as on March 1, 2012. The FCI and state agencies have a ‘covered’ capacity to store only 43.8 MT. That is, only 43.8 MT food grain is stored in proper godowns. The rest, 9.5 MT is lying in the open, with tarpaulin cover and wooden plinth for protection, called ‘CAP’ in FCI parlance.

Worse, the stock will rise to 75 MT by June 1. This is FCI’s projection which has rung alarm bells. What it means is this: By June 1, 31.2 MT (21.7 MT additional stock plus 9.5 MT) will be rotting in the open.

Procurement of food grain has been going on. There will be additional burden also because of the food security bill the government intends to pass and enforce from this year. But as far as capacity building is concerned to store the food grain, the government’s efforts have been tardy.

Just one example will suffice.

The food and civil supply ministry had planned to add 10 MT of covered storage capacity by the end of the 11th plan (2011-12). These were to happen with the help of private players in the PPP mode. The actual addition is less than 2 MT.

The plans were grand, tenders were issued and actual sanction was given for building 15 MT capacity. But the response of the private players has not been good. There were also grand plans of creating silos of 2 MT capacity. But it is still stuck at the planning stage.

Now the FCI has begun sending warning notes to the ministry, the central and state warehousing corporations to hire additional space keeping in mind the projected level of stock. The shortage is acute in procuring states – Punjab, Haryana, Andhra Pradesh, UP, Bihar and Odisha.

In 2008, the government had introduced a scheme of hiring storage space for a period of 5 to 10 years to quicken the pace. Shockingly, FCI’s internal communication shows it is still “at various stages of finalization”.

The ministry also has a problem of quick distribution of food grain because of which it keeps rotting in the open for years. Taking umbrage at this, two years ago the supreme court had asked the government to distribute rotting food grain free of cost to the starving millions. The government refused to oblige saying that it would cost the exchequer Rs 5,000 crore.

Since then, neither the distribution process improved nor proper storage facilities created.



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