Govt. impose a ceiling on wheat stocks

Recently, the Union Government has imposed limits on stock of wheat that can be held by traders, wholesalers, retailers, big chain retailers and processors, in a move endeavouring to manage the “overall food security and to prevent hoarding and unscrupulous speculation.”

• The objective is to stabilise the price of the essential commodity by steadying supply.
• The imposed limits include:
  • The permissible stock that traders/wholesalers can hold is 3,000 metric tonnes.
  • Retailers and big chain retailers can hold up to 10 metric tonnes at each of their outlets, while the latter can hold up to 3,000 metric tonnes at all their depots combined.
  • Processors would be able to stock 75% of the annual installed capacity.
• If the stock held by them is higher than the limit, they will have 30 days from the day of issue of notification to bring the same under the prescribed limits.
• Additional Orders:
  • The government has also decided to offload 15 lakh tonnes of wheat from the central pool via the Open Market Sale Scheme (OMSS) to flour mills, private traders, bulk buyers, manufacturers of wheat products through e-auction.
  • Aim: The idea is to control retail prices of wheat.
  • They would be sold in lot sizes of 10 to 100 metric tonnes.

Need for the move:

• Due to high heat and Climate affecting crops:
  • Major wheat producers as Punjab, Uttar Pradesh, Madhya Pradesh and Haryana experiencing strong thunderstorms with lightning and gusty winds alongside hailstorms., which is affecting production and quality of wheat crops.
• To withstand the potential effects of Upcoming EL Nino year:
  • As the year 2023-24 has expected to be an EL Nino year, there may be chances of drought and reduced rainfall, affecting agriculture in India.

Challenges:

• The damaging combination (Heat+ Rain):
  • Unnaturally high temperature: Before the downpour began in March, India had already experienced the hottest February in over a hundred years. That was critically damning to the wheat crop.
  • Heavy downpour: The high temperature immediately preceded unseasonal downpour.  

Current Framework for Food Security in India:

• Constitutional Provision: The fundamental right to life enshrined in Article 21 of the Constitution can be interpreted to include the right to live with human dignity, which may include the right to food and other necessities.
• Buffer Stock: Food Corporation of India (FCI) has the responsibility of procuring food grains at minimum support price (MSP) and maintaining a buffer stock.
• Public Distribution System (PDS): Over the years, the Public Distribution System has become an important part of the Government’s policy for the management of the food economy in the country.
• PDS is supplemental in nature and is not intended to make available the entire requirement of any of the commodities.
• National Food Security Act, 2013 (NFSA): It marks a paradigm shift in the approach to food security from welfare to a rights-based approach.
• Pradhan Mantri Garib Kalyan Anna Yojana (PM-GKAY): PMGKAY is a part of the Pradhan Mantri Garib Kalyan Package (PMGKP) to help the poor fight the battle against Covid-19.