The Punjab government that recently had to struggle to get the second instalment of the cash credit limit (CCL) for paddy procurement once again is in desperate need of the third instalment to wrap up the paddy procurement.
The situation that the state witnessed two weeks ago is being repeated as 15 lakh to 20 lakh tonne of paddy is still to be procured and the state exhausted all funds four day ago. To wrap up the current kharif season, the state still needs Rs 3,500 crore.
After persistent efforts by a state delegation led by food and civil supplies minister Adesh Partap Singh Kairon, the Centre released the second instalment of Rs 10,451 crore on November 7. "Once again, we have written to the union finance minister for releasing the third instalment," said an officer in the state food and supplies department.
The Reserve Bank of India (RBI) and the union food ministry have given clearance for release of the limit but it needed final nod from the finance ministry. A delegation from Punjab is expected to leave for Delhi on Friday in this connection.
The first instalment of Rs 8,000 crore of the CCL had reached Punjab on October 10, 10 days after the start of paddy procurement. It had come with a caveat from the union finance ministry that the state government settle the pending CCL accounts of Rs 42,000 crore in consultation with the Food Corporation of India before seeking permission for the next CCL advance.
Though there was no such condition at the time of releasing the second instalment, the Centre not releasing the third instalment has come as a shocker to the state government.
At the onset of the paddy procurement season, the state had demanded a CCL of Rs 23,000 crore, with an estimated arrival of 120 to 125 lakh tonne of paddy in its grain markets.
"The state has procured about 100 lakh tonne of paddy and has made payments to the farmers but still 15 lakh tonne paddy is to be procured for which we need Rs 3,500 crore," said a food department officer.It is for the first time that the state has extended the procurement season till November end, which normally ends by October.
The Centre has been pointing out faults in the usage of CCL by Punjab for the past three to four years, asking the state to clear its outstandings, which started building up in 2003-04. In the previous rabi season, the Centre had categorically told Punjab to settle the outstandings that the state ignored and in the current season the CCL was stopped.