Joint action plan to check
price rise
Curbs on flow of
essential items may go
Tribune
News Services
NEW DELHI, Nov 7 — A
coordination committee meeting of the Cabinet Secretary
and Chief Secretaries of States and Union Territories
today worked out a joint action plan to combat increasing
prices of essential commodities. The plan includes the
setting up of a national forecasting centre for
agricultural produce that would enable advance planning
on the price front.
The meeting, which
reviewed the situation arising out of the recent increase
in prices of some essential commodities, discussed both
short-term and medium-term measures to bring down the
prices and to avoid a recurrence of the problem.
The Cabinet Secretary, Mr
Prabhat Kumar, told newspersons after the four-hour
meeting that the setting up of a national forecasting
centre for agricultural produce would enable real time
assessment of surpluses and deficits and it would be
useful for the government to plan its export and import
strategy in advance.
The Centre would set up a
joint monitoring mechanism between the Central and state
governments. The state governments and Union Territories
would play an important role by providing valuable inputs
for the crop forecasts.
The setting up of a joint
monitoring mechanism is a significant step as the present
muddle and scarcity of essential commodities like onions,
potatoes and pulses was a result of the government’s
delayed planning. Advance steps like banning of onion
export much before the crisis took place or locating
suppliers of the commodity in the import market could
have prevented the present crisis on the price front.
The Cabinet Secretary said
the decisions on imports to cover the anticipated gap
between demand and supply would be taken at the stage of
forecasts prepared on the basis of area sown. That is to
say such decisions would be taken three to four months in
advance of harvest. It was also felt that such imports
should be undertaken on a centralised basis by Central
government agencies and not separately by individual
state agencies.
Among short term measures,
the meeting decided that the ban on export of onions,
which is valid till November 30, could be extended till
January 31, next year as there are reports that seedlings
for the late kharif crop of the bulbous vegetable has
been damaged.
It was also decided that
the state governments should remove both formal and
informal restrictions on the movement of essential
commodities to enable their free flow and distribution in
the country.
It was felt that stringent
action should be taken against hoarders and black
marketeers under the provisions of the Essential
Commodities Act and the prevention of Blackmarketing and
Maintenance of Supplies of Essential Commodities Act. It
was noted that necessary powers in this regard already
stand delegated to the state governments and Union
Territories and they should invoke these powers whenever
warranted.
The state governments and
Union Territories have been told to undertake market
intervention operations as a last resort in a transparent
manner so as to ensure that the maximum benefits were
made available to the vulnerable and weaker sections of
the society. Mr Kumar said the Centre had conveyed that
where necessary the Central government would be prepared
to consider grant of financial assistance to states for
this purpose on matching basis.
Several state governments
requested for additional allocation of wheat, rice, sugar
and palmolein and this was agreed to by the Centre.
However, the additional allocation of essential
commodities would be a one-time affair, Mr Kumar said.
It was pointed out at the
meeting that the implementation of the compulsory
packaging order on edible oils was causing hardship to
the poorer sections of the society who bought oil in
small quantities. It was decided that the state
governments would be given freedom to exempt any edible
oil from the provisions of the order.
In the medium-term
measures, the meeting decided to make adequate storage
facilities available in the country. It was decided that
an action plan should be immediately drawn up to build
storage capacity in different parts of the country.
States maintaining control on cold storages have been
asked to repeal their cold storage orders.
Mr Kumar said in order to
improve the country’s storage technology for
agricultural products, the Ministry of Agriculture would
set up a high-level expert group to identify the
necessary policy measures.
Strengthening of food
processing facilities also figured in today’s
discussions. This would not only ensure that the loss
presently due to wastage of vegetables and fruits is
avoided but also that such commodities are available in
processed form in times of shortage.
It was felt that there was
a need to tighten the distribution machinery in the
states and Union Territories to minimise the scope for
any kind of diversion of stocks. Along with this the
price monitoring mechanism in the states and union
territories would also be strengthened on a priority
basis to cover the rural areas also.
It was also decided to set
up a special study group to identify measures required to
meet the needs of North-East states and island
territories regarding the supply of essential
commodities.
The meeting was held at
the initiative of the Prime Minister, Mr Atal Behari
Vajpayee, who took the decision after holding discussions
with a group of ministers heading the various economic
ministries last week.
Mr Prabhat Kumar said
while hoarding and blackmarkeing figured in the
discussions the meeting did not discuss any measures that
would affect the trading system in the country.
"There was no attempt by the group to interfere with
the process of free trade in the country" he added.
The Cabinet Secretary said
he was hopeful that the prices of essential commodities
would return to more realistic levels as the kharif
production this year was expected to be as much as that
achieved in the previous year. It was due to vagaries of
weather that arrivals had been affected and it was
getting normal, he added.
He said effective
monitoring of the crop pattern and initiation of advance
action would prevent a crisis on the price front in the
future.
Mr Kumar admitted that the
decision to import onion had little affect on the market
as the quantities available in the international market
were not sufficient. Against an authorisation to import
13,000 tonne of onion, NAFED and the Delhi government
were able to procure a few hundred tonne only. He was
confident that with the arrival of fresh crop of onion
from Maharashtra, Andhra Pradesh and Karnataka, the
prices of onions should stabilise.
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