OPINION: LESSONS FROM THE FRACAS OVER FOODGRAINS
The Karnataka government's decision to convert the promised Anna Bhagya scheme to a direct benefit transfer temporarily has brought into focus the limits of a State government's policy intervention on a crucial matter such as food security.
OPINION: LESSONS FROM THE FRACAS OVER FOODGRAINS
The Karnataka government's decision to convert the promised Anna Bhagya scheme to a direct benefit transfer temporarily has brought into focus the limits of a State government's policy intervention on a crucial matter such as food security.
• Under the Anna Bhagya scheme, the government had envisaged the provision of five kg of rice per person per month to BPL and Antyodaya card holders. This would have been in addition to the five kg of rice that is provided under the National Food Security Act.
• Until now, a major source of rice for Karnataka was the Centre's OMSS (Open Market Sale Scheme). Through it, the Food Corporation of India had been selling surplus grains. On June 13, the Centre discontinued the sale of wheat and rice through OMSS to States to control inflation.
• OMSS is meant for selling excess rice and wheat to bulk buyers, traders, and States at pre-determined prices through e-auctions in the open market. This is done to moderate market prices and enhances supply during lean seasons.
• Now, the scheme is limited to accommodate small and marginal buyers and traders. The quantity that a bidder can purchase in a single bid ranges from 10-100 metric tons at present.
This has put Karnataka, the biggest OMSS beneficiary, in a fix. The Centre, on the other hand, has its own compulsions behind the decision. The quarterly stock position of rice and wheat in the Central pool, as on April 1 2023, was the lowest in the last three years. Secondly, the uncertainty regarding the monsoon and its adverse impact on production is another important factor.
All else aside, the episode has delivered a key message to States that they must have their own mechanisms in place before launching any scheme. To make sure that not only a comfortable stock but a surplus is maintained, both the Centre and States have to exercise discipline and go beyond electoral promises.