Page 562 - ES 2020-21_Volume-1-2 [28-01-21]

Prices and Inflation 189

Other measures to control undue price rise include:

1. Price Stabilization Fund (PSF) Scheme is being efficiently implemented and has
succeeded in achieving its objective of stabilizing prices of pulses and offered
significant benefits to all stakeholders. Government in 2016 has approved creation
of a dynamic buffer of up to 20 lakh tonnes of pulses for appropriate market
intervention. A buffer stock of 20.5 lakh tonnes of pulses was built through both
domestic procurement of 16.7 lakh tonnes by Food Corporation of India (FCI),
National Agricultural Cooperative Marketing Federation of India (NAFED) and
Small Farmers’ Agribusiness Consortium (SFAC) during November 2015 to July
2017, and imports of 3.8 lakh tonnes by Metals and Minerals Trading Corporation
(MMTC) and State Trading Corporation of India (STC). Domestic procurement for
the buffer was done from farmers and farmers’ association during Kharif Marketing
Seasons (KMS) of 2015-16 and 2016-17 as well as Rabi Marketing Seasons (RMS)
of 2016-17 and 2017-18, benefitting about 8.5 lakh farmers. Last import was
contracted in November 2016, i.e., up to period when domestic availability was low
during 2015-16 and 2016-17.

2. Government has taken a decision that all Ministries/Department having schemes with
nutrition component or providing food/ catering/hospitality services would utilize pulses
from the central buffer. Pulses from the buffer are utilised for PDS distribution, in Mid-
day Meal Scheme and in ICDS Scheme. In addition, pulses from the buffer are being
utilized to meet the requirement of Army and Central Para-Military Forces. The balance
stock is disposed in market, based on considerations like shelf life, efficient buffer
management, market prices etc.

3. Creation of buffer stock of pulses has helped in moderating pulses prices. Lower prices
of pulses lead to consumer savings. Built buffer also led to remunerative prices to
farmers as procurement for buffer was undertaken at MSP or higher rates from them.
This incentivized production which led to two successive years of bumper production
taking country towards self-sufficiency and resulting in reduced imports and concomitant
savings in forex.

4. Subsequently, Government has decided that procurement at MSP would be under Price
Support Scheme of Department of Agriculture, Cooperation and Farmers Welfare and
requirement towards building suitable buffer would be met from the PSS stock in case
procurement is not required to be undertaken under PSF. As the procurement since
Rabi-17 was under MSP operation of PSS, pulses procured under Price Support Scheme
(PSS) of Department of Agriculture and Cooperation and Farmers Welfare (DACFW)
have since been channelized to PSF to the extent of meeting buffer requirements.
Since April 2019, around 20.07 LMT has been transferred from PSS to PSF to
replenish buffer under PSF. Further, based on request from States and endorsement
of the same by DACFW, 1.8 LMT Tur was procured under PSF at MSP during KMS
2019-20. Also, around 93 MT Masur was procured at market prices during RMS 2020
under PSF.