Food grain procurement policy deserves review

G. CHANDRASHEKHAR, Hon Advisor, IMC-ERTF

At the recently concluded Dryland Congress in New Delhi, Union Agriculture Minister Shri Shivraj Singh Chouhan stated with a sense of regret that expansion of irrigation facilities in Madhya Pradesh during his tenure as Chief Minister has not really served its intended purpose.

 

MP is a major producer of millets and oilseeds (mainly soybean) in the Kharif season, pulses mainly chickpeas (chana) and oilseeds (mainly rapeseed/mustard) in the Rabi season.

 

Irrigated land in MP in recent years is being increasingly used for growing fine cereals – wheat and paddy - in which the country is largely in surplus or self-sufficient. To be sure, India is the world’s largest producer and exporter of rice and second largest producer of wheat. 

 

At the same time, India faces a shortage of pulses and oilseeds; and imports them to augment availability. We import 6-7 million tons of pulses and 15-16 million tons of vegetable oils that entail enormous outgo of foreign exchange (well over $ 20 Billion a year).  

 

Even as the Union Agriculture Minister rues that MP’s irrigated lands are not used for key dryland crops like millets and pulses, he must ask himself a question: who is responsible for this state of affairs and what does he intend to do.

 

The reality is that our food policy is outdated and not in sync with the current times. In the 1960s, Green Revolution was a necessity to ensure food security for a growing population. Given the natural endowment of water, Punjab /Haryana became the country’s bread-basket, cultivating rice in the Kharif season followed by wheat in the Rabi season.

 

Called ‘grain mono-cropping’, the unbroken, input-intensive rice-wheat-rice cycle of last five decades has resulted in enormous ecological challenges. In Punjab and Haryana, the water table has gone down to alarmingly low levels. Soil health has deteriorated with indiscriminate use of synthetic fertilizers; while crop rotation with say legumes is simply absent. There is an ecological disaster waiting to happen.

 

One strong reason why growers in Punjab and Haryana continue to stick with grain mono-cropping is the open-ended procurement policy of the Government of India, topped with attractive procurement price. The Centre procures rice and wheat for supply through the Public Distribution System (PDS). Often, the Food Corporation of India (FCI) is the first, last and only buyer of rice and wheat in Punjab and Haryana.

 

Availability of a government-supported ready market and attractive prices over decades have combined to create a sense of entitlement; and have actually discouraged growers of fine cereals from adopting crop rotation and exploring cultivation of oilseeds and pulses. The latter crops do not have an open-ended procurement policy unlike rice and wheat; and therefore growers are unsure of remunerative returns.

 

Growers in MP cannot be an exception to happenings elsewhere in the country. They watch their counterparts in Punjab and Haryana market the harvested crop with ease and take home decent amounts of money. So, why blame MP growers with access to irrigation for growing fine cereals. 

 

This legacy ecosystem deserves creative disruption; and disruption calls for ‘political will’.

 

Without an iota of doubt, food security is critical for our country, especially in the context of land constraints, water shortage and climate change. Close to 60% of the population (800 million out of 1.4 Billion) is still on ‘free ration’ of 5 kilograms of rice or wheat every month.

 

At the same time, we export 15-20 million tons of rice annually and occasionally a few million tons of wheat. By exporting these fine cereals, we are actually exporting water out of India, as the crops are water-guzzlers. It is an indirect and unaccounted cost for the country.

 

Our grain procurement policy needs a thorough review and tweak to meet our current exigencies. Open-ended procurement must be brought to an end as it is outliving its utility. A ceiling on rice and wheat procurement is necessary. Needs of various welfare programs and buffer stocks must be taken into account. 

 

Let there be honest stakeholder consultation, especially with growers in key rice and wheat growing states. Examine whether the growers’ current incomes can be protected if they were to move even partially away from rice-wheat cycle and grow pulses and oilseeds. Give them a 2-year advance notice so that they are prepared.

 

The procurement infrastructure for oilseeds and pulses must be strengthened, especially in areas where fine cereal growers are diversifying into legumes.

 

On top of these is the government’s import policy itself. Unregulated import of pulses and vegetable oils is actually discouraging domestic growers. Imports need close monitoring and strict regulation. The government has no clue today how much cargo is contracted for import, arrival period and prices. It has no prior data or advance guidance whatsoever;. Absence of prior data often results in kneejerk policy reaction. New Delhi must use tariffs judiciously to encourage or discourage imports.

 

In the last three decades, several expert committees formed to examine the food grain policy including open-ended procurement had recommended a review. I have provided policy inputs on multiple occasions to these expert committees. Nothing came of it. That’s where ‘strong political will’ to disrupt the existing legacy ecosystem and formulation of a new food policy paradigm comes in. The Agriculture Minister must seize the initiative.      

Add a Comment

Recent Blogs


The Silver Jubilee of Modi’s Governance: From the Rubble of Kutch to the Era of Amrit Kaal

Krishna Shah 

When Narendra Modi assumed office as Chief Minister of Gujarat in October 2001, the state was reeling from the catastrophic Kutc

Read More

OCTOBER AND DECEMBER MPC MEETS CAN BE PERFECT PITCH FOR NUANCED RATE HIKE CALLS OF 25 BPS EACH

SBI Research 

India's retail inflation, based on the CPI (new base), rose to 4.82% in August 2026, up from 4.45% in July, due to broad based

Read More