Jaitley evasive on funds for paddy procurement | chandigarh | Hindustan Times
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Jaitley evasive on funds for paddy procurement

chandigarh Updated: Nov 07, 2014 07:44 IST
Gurpreet Singh Nibber

Efforts by the Punjab government to secure the release of funds for paddy procurement from the Centre have proved futile. A team of state officers led by food and civil supplies minister Adesh Partap Singh Kairon, which met Union finance minister Arun Jaitley on Wednesday for the prompt release of funds, came back empty-handed.

Sources said Jaitley told Kairon to wait for a few more days so that he could talk to union food minister Ram Vilas Paswan to know the ‘actual position’ of the outstanding amount to be recovered from the state.

Punjab chief minister Parkash Singh Badal has reportedly already written to Prime Minister Narendra Modi, seeking his intervention for the release of funds for paddy procurement.

In the absence of funds (cash credit limit), any fresh procurement of paddy has been stopped and payment for more than 40 lakh tonnes of paddy already lifted is still pending. “A crisis is building up as there is no money in government coffers and farmers are pressing state procurement agencies for the release of cost of their crop, which has already been procured. As farmers are not getting payment for the paddy produce, wheat cultivation is delayed,” said Punjab Mandi Board vice-chairman Ravinder Singh Cheema.

There are about 1,900 procurement centres (grain markets) in the state.

Officials of the state food department said orders were issued last week to stop procurement as the cash credit limit (CCL) of Rs 8,000 crore received by the state at the beginning of the procurement season had already been exhausted. The state needs Rs 10,000 crore more, which officials claim was sanctioned by the Reserve Bank of India (FCI) and has the union food minister’s nod. However, clearance from the finance ministry is pending.

State procurement agencies have procured about 100 lakh tonnes out of the 120 lakh tonnes expected in mandis this season. They have made a payment for 55 lakh tonnes.

The first instalment of Rs 8,000 crore arrived on October 10, delayed by 10 days. It came with a rider that Punjab had to clear the previous accounts of CCL with the Food Corporation of India (FCI), after which second instalment would be cleared. Punjab says that funds must be released at the earliest as state’s farmers grow wheat and paddy for the entire country and state government agencies procure foodgrains on behalf of the Centre.

The delay in procurement funds is also affecting SAD-BJP relations, since the SAD, known as a party of peasants with a rural base, was expecting a much better deal from the BJP-led NDA government.

As per reports, Rs 42,000 crore of previous CCLs is to be settled. In its defence, Punjab has claimed that Rs 25,000 crore is due from the Centre against procurement done in the past on behalf of the Centre. For the remaining amount (about Rs 17,000 crore), wheat and rice is in store houses, yet to be lifted by the Centre.