Kozhikode: The Kerala Roller Flour Millers' Association on Monday alleged that increase in the price of wheat and `exorbitant' hike in the rail freight charges had affected the viability of flourmills in the State.

At least 42 major mills in the State were on the verge of closure, it said.

A consortium, comprising office-bearers of the Southern States, would meet Union Ministers in this regard, association president P.K. Ahammed and chairman P.V. Chandran said.

Mr. Ahammed demanded that the Centre remove the customs duty of 5.1 per cent on wheat import and the State Government to abolish value added tax (VAT) on wheat products.

The Centre should also allocate 20,000 metric tonnes of wheat to mills in the State through open sale scheme of the Food Corporation of India (FCI) to meet the shortage of wheat flour in the State.

Open sale scheme

Mr. Chandran said that flourmills in the State depended on Punjab, Delhi, Haryana, Uttar Pradesh and Madhya Pradesh for wheat requirement.

Occasionally, the FCI released small quantities under the open sale scheme.

At present, the price of wheat was Rs.1,000 per quintal.

An additional amount of Rs.200 had to be given for freight and other charges. Last year, the amount was Rs.800, he said.

The Centre should restructure the per capita allocation of wheat as the consumption of wheat in the State had grown with the changing food habits of people, Mr. Ahammed said.

He said that the four per cent VAT on wheat products had imposed an additional burden of Rs.55 per quintal.

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