Government to start PDS sale of edible oils to tame food prices even as rains revive news
26 July 2008

Mumbai: The government will start selling edible oils through ration shops at cheaper-than-market rates beginning Monday, to ease the pressure of food prices on the common man.

''Public sector PEC, MMTC, STC and NAFED have been entrusted with the job of importing, refining, packing and distributing the subsidised edible oils," food and agriculture minister Sharad Pawar said in a statement.

The department of food and public distribution has made allocation of edible oil to all state governments which had placed demand under the scheme, the statement added.

Pawar will inaugurate the distribution of subsidised edible oils at Tandur in Ranga Reddy district of Andhra Pradesh on Monday. The scheme is expected to raise the government's subsidy bill by Rs1,500 crore, according to the statement.

The scheme provides for PDS distribution of a total 10 lakh tonnes of edible oils in 2008-09. Under the scheme, one kg of cooking oil will be provided per month at a subsidy of Rs15.

The move comes amidst fears that the scanty rains in southern and western India will cause a major drop in crop area under oilseeds, pulses and sugar and this in turn will further raise prices of most food items.

Lack of rains in Maharashtra, Andhra Pradesh and Karnataka, which together account for 65 per cent of the country's kharif pulses output, has pushed up prices by Rs300-400 a quintal for almost all pulses.

Maharashtra, Karnataka, Andhra Pradesh and Gujarat are the worst affected, where crops like tur dal, groundnut, jowar, soyabean, maize and cotton are facing problems.

Moong prices are ruling at a high of around Rs3,125 a quintal, urad at Rs3,200 a quintal and tur dal at around Rs3,200-3,225 per quintal.
The total area under kharif pulses in the country has come down to 63.8 lakh hectares from 77.8 lakh hectares in the corresponding period last year and from around 109 lakh hectares much earlier, data released by the agriculture ministry showed.

To date, around 5.8 million hectares have been covered under Kharif crops against 7.2 million hectares in the same period last year.

Andhra Pradesh has been allocated the highest quantity of 20,750 tonnes of edible oils per month for PDS sale, followed by Maharashtra (18,200 tonnes) and Tamil Nadu (15,500 tonnes).

State agencies have so far placed orders for import of 2.60 lakh tonnes of edible oils. Of this, 1.36 lakh tonnes have been shipped and 39,800 tonnes have already been delivered to various states by 21 July.

Despite a record foodgrains production for 2007-08 of 230.67 million tonnes, food prices have been ruling high in the current year.

Meanwhile, the Indian Meteorological Department (IMD) said the deficiency in rainfall will be made up in the coming days, especially in peninsular India, abating fears of a major drop in production of oilseeds, pulses and rice.

In fact, incessant rains in most parts of peninsular India has ended the long dry spell. But it remains to be seen how benevolent the rains are.


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Government to start PDS sale of edible oils to tame food prices even as rains revive