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Concerns over procurement, milling arrangements

chandigarh Updated: Sep 08, 2014 11:32 IST
Gurpreet Singh Nibber
Gurpreet Singh Nibber
Hindustan Times

A glut of the basmati variety of paddy is expected this kharif season in Punjab, as early-sown varieties of the crop have already started arriving in some areas including Fazilka. The absence of an effective procurement system, coupled with inadequate arrangements for milling into rice, has raised concerns among experts and farmers.

Figures gathered from various sources say basmati was sown over 6.5 lakh hectares in the state, about 25% of the total area (28 lakh hectares) under paddy cultivation. Production of 40 lakh tonnes of basmati is expected, which is 30% of the total estimated paddy production. Area under basmati has doubled as compared to last year, hence the production too.

“We have written to the state government to take immediate steps and make arrangements for basmati procurement. In the absence of any system of procurement, it is going to be a glut-like situation for sure,” said Punjab State Farmers’ Commission consultant PS Rangi.

In the absence of adequate arrangements for milling of basmati, a tough challenge is predicted for farmers and private traders who purchase basmati from farmers. “As it requires a sophisticated system to mill paddy, Punjab lacks the infrastructure to handle this quantum of crop,” said Punjab Mandi Board vice-chairman Ravinder Singh Cheema.

In Jalalabad, Tarn Taran, Amritsar, Gurdaspur, Muktsar and Sirhind areas, basmati cultivation has touched 90% of total area under paddy. According to Cheema, 25,000 to 30,000 commission agents are involved in basmati procurement in grain markets and procurement centres, who sell it further to exporters.

“There is going to be slow lifting of the crop, as total arrival is expected to touch Rs 12,000 crore whereas commission agents have only Rs 5,500 crore available,” informed Cheema, who is also the president of a state-level commission agents’ association. He demanded that traders from Haryana be allowed to lift basmati from Punjab, and traders be exempted from paying 2% rural development fund (RDF) and 2% market fee.

Rangi supported Cheema’s demand of active participation by governments, but differed on waiving of the fees. “There is no need for waiver, as exporters and traders take huge margins while farmers barely get actual cost,” Rangi said, seeking permanent assured arrangement for basmati procurement from the government as it is seen as farmers’ efforts towards much-needed diversification. He demanded that price be maintained at Rs 4,000 per quintal.