India Boost Buffer Stocks

DELHI - Sep 12/16 - SNS -- India's Cabinet Committee on Economic Affairs has approved a proposal to boost buffer stocks of pulses to two million metric tons (MT), split evenly between domestic and imported product.

The specific classes and their respective quantities will be based on price and availability. The government said in a statement that releases from the stock and procurement in the subsequent year would be based on the prevailing market conditions and the buffer stock position.

Domestic buying will be undertaken by FCI, NAFED and SFAC or any other agency to be determined by the PSFMC. Farmers will receive the prevailing market prices or the Minimum Support Prices (MSP), which ever is higher. State Governments may also be authorized to buy pulses in a manner similar to decentralized procurement of food-grains.

Imports will be undertaken through government to government contracts and/or spot purchase from the global market through designated Public Sector Enterprise of Department of Commerce or any other agency designated by PSFMC.

The allocation/release of the pulses from the buffer stock would be made to States/ UTs and Central Agencies. Pulses would also be released through strategic open market sale. For managing the buffer, professional pulses buffer management entity may also be engaged. The exercise will ensure a stable price regime for pulses and will also encourage domestic farmers to increase production of pulses.

In a related move, the government said it will fix prices for pulses in retail markets. The government explained, "If the retail sale price of any essential commodity is fixed and notified by the competent authority under the Essential Commodities Act, the same shall apply (to bulk and packaged pulses)."

I retailers fail to comply, they can be fined Rs 5,000 and their entire stock of pulses confiscated.