Cabinet nod to increase pulses buffer stock to 20 lakh tonnes

New Delhi: The government on Monday approved a proposal to enhance buffer stock of pulses up to 20 lakh tonnes, an official statement said.

The move reflects government's concern to address the concern of farmers following drop in prices of pulses, especially moong.

The decision was taken at a meeting of the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi.

"The Cabinet Committee on Economic Affairs has approved the proposal of Department of Consumer Affairs on enhancing the buffer stock for pulses up to 20 lakh tonnes. The buffer stock will be built through domestic procurement and imports of 10 lakh tonnes each," the statement said.

Under attack over escalating prices of pulses, the centre had formed a group of ministers, headed by Finance Minister Arun Jaitley. The panel was asked to frame a long-term policy on pulses to relook at various options including the MSP and bonus to promote pulses cultivation.

However, the fall in prices of moong dal has left the government worried as it could adversely impact farmers.

Last week, Food Minister Ram Vilas Paswan said that as prices have come down the government was open to creating buffer stock and procure moong dal to give relief to farmers.

Retail prices have of moong fallen in last few weeks from around Rs 200 per kg to the range of Rs 115-170 per kg across major cities.

In view of decline in prices of moong dal, the government on September 6 announced that it will procure the commodity at MSP rate and asked the states to procure the same to safeguard the interest of farmers.

The government statement on Monday came after the cabinet committee on economic affairs said that specific variety of pulses, and their procurement will be decided based on price and availability position, both domestic and global.

The allocation or release of pulses from the buffer stock would be made to states and union territories 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 official statement said. The exercise will ensure a stable price regime for pulses and also encourage domestic farmers to increase production of pulses.

Releases from the stock and procurement in subsequent year would be based on the prevailing pulse scenario as well as buffer stock position.

Requisite funds for this operation would be provided to the 'Price Stabilisation Fund' Scheme of the department.

For creating the buffer stock, the domestic procurement operations will be undertaken by the central agencies namely FCI, NAFED and SFAC or any other agency at the prevailing market prices if it is above Minimum Support Price (MSP), and at MSP rates if otherwise.

The states may also be authorized, wherever possible, to undertake the procurement in a manner similar to decentralized procurement of food-grains.

"Over the years, the government used to fix MSP for moong, but there used to be no procurement by government agencies. But this year, following proposals from Karnataka and Maharashtra governments, a decision has been taken to procure the same," a Food Ministry official said.

The high prices of pulses has been a major issue haunting the government this year.

Last month, the central government fixed the moong MSP at Rs 5,275 per quintal for this year.