NEW DELHI: Responding to criticism from the United Progressive Alliance constituents, Food Minister Sharad Pawar on Tuesday stayed the implementation of the Centre's decision to cut food subsidy.

"I am not executing the decision till such time I talk to the Congress, the CPI (M), the CPI and all those who are opposing the decision," he told presspersons here.

Asked whether the decision would be rolled back, Mr. Pawar said, "I am staying the implementation. I will discuss with the UPA. I expect them and others supporting the UPA to understand the rationale behind the decision." On Friday last, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Manmohan Singh, approved the Food Ministry's proposal to raise the issue price of foodgrains for the Above Poverty Line population under the Targeted Public Distribution System and cut the allocation to all categories of beneficiaries. These measures are meant to reduce the food subsidy bill by Rs. 4,525 crore in a full year.

Mr. Pawar said the decision did not entail any hike in the central issue price to beneficiaries of the Antyodaya Anna Yojna (poorest of the poor) or the Below Poverty Level category. "Only the issue price for the APL population has been raised. Every year we are giving a higher support price for procurement of foodgrains but we have not raised the issue price in the TPDS since 2000. The entire burden was borne by the government."

Foodgrains offtake

The foodgrains offtake by the APL population was not more than 20 per cent. The Planning Commission had done a survey on the APL, its offtake and utilisation.

Offloading stocks

Explaining the decision to reduce the quota for BPL households, Mr. Pawar said the decision to raise the allocation was taken at a "particular time for a particular reason." It was done to offload stocks from overflowing granaries. "The allocation was raised from 10 to 15 kg, then 20 kg, 25 kg, 30 kg and 35 kg because there were huge stocks getting rotten."

When the stocks were offloaded, the food subsidy was Rs. 9,000 crore. Today it was Rs. 26,000 crore. "We are still giving a subsidy of 30 per cent to the Above Poverty Line population. We are collecting only 70 per cent of the economic cost from them. I will explain this position to the UPA and hope they understand."

``Still giving 30 % subsidy''

After the CCEA's approval, the Government raised the central issue price of wheat from Rs. 6.10 to 7.05 a kg and of rice from Rs. 8.30 to 9.15 for the APL.

It reduced the monthly allocation for the APL from 35 to 20 kg a household and for the BPL and Antyodaya Anna Yojna beneficiaries from 35 to 30 kg.

Printer friendly page  
Send this article to Friends by E-Mail