Bringing Green Revolution to
Eastern States of India
Presentation by
Dr. Amar Singh, CMD, FCI
Kolkata, September 26, 2012
FCI’s Commitment
• Incentivize production of food grains by ensuring
Minimum Support Price (MSP) to farmers.
• Assist the State Governments in procurement of food
grains from the farmers.
• Help create infrastructure like scientific warehouses,
testing labs etc.
• Equip the State agencies to take up procurement
operations through capacity building measures.
Procurement Policy
• Procurement of foodgrains is open ended to
avoid any distress sale by the farmers.
• MSP is revised by GoI on the basis of input cost
incurred by the farmers.
• MSP for Paddy has been revised from Rs 530 in
the year2001-02 to Rs 1250 per quintel in
KMS2012-13.
Procurement Policy (contd….
• Similarly MSP for wheat has been revised from
Rs 580 in 2001-02 to Rs 1285 per qtl in RMS
2012-13
• To incentivize the state govt, GoI reimburses
all the expenses incurred on the procurement
of foodgrains for the central pool.
Minimum Support Price of Paddy & Wheat
for Last 10 Years
5
(Figures in Lakh MT)
1400
1300
1200
MSP + Bonus (Rs. /quintal)
1100
1000
900
The MSP of
paddy has
increased by
2.3 times since
2001-02.
800
700
600
500
400
The MSP of
Wheat has
increased by
2.2 times since
2001-02
2001- 2002- 2003- 2004- 2005- 2006- 2007- 2008- 2009- 2010- 2011- 201202
03
04
05
06
07
08
09
10
11
12
13
Paddy* 530 550 550 560 570 620 745 900 1000 1000 1080 1250
Wheat 580 610 630 630 640 700 850 1000 1080 1100 1170 1285
*-MSP + Bonus (if any) for ‘Common’ variety of paddy
Production & Procurement of Rice
at the national Level
120
99.18
Quantity in million MT
100
80
95.32
93.3
88.5
83.1
96.69
91.8
89.09
60
40
20
104.32
33 %
24%
24.7
34.1
34.19
27.6
22.8
0
2003-04
28.74
25.1
34.90*
32.03
Production
2004-05
2005-06
2006-07
2007-08
2008-09
Procurement
2009-10
2010-11
2011-12
Year (KMS-Wise)
6
* For 2011-12, figures upto 24.09.2012
Eastern States Scenario for RICE
During KMS 2011-12.
In Lakh MTs
State
Production
Procurement
Procurement as
% of Production
All India
Eastern States
1043.20
548.20
349.03
140.73
33.40
25.50
63.54
58.82
120.4
63.5
159
37.6
45.3
41.15
28.39
33.5
15.34
19.19
2.93
0.23
64.8
48.3
27.8
24.1
12.1
7.8
0.5
Chattisgarh
Orissa
UP
Bihar
WB
Jharkhand
Assam
There is tremendous potential to improve procurement
in the states of West Bengal, Jharkhand and Assam.
Some Eastern States have shown substantial increase in
Rice Procurement in last 6 Years
(Figures in Lakh MTs)
KMS
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
Assam
0
0
0.03
0.08
0.16
0.23
Bihar Chhattisgrh Jharkhand Orissa W.B U.P
0.05
4.76
28.65
20.02 6.41 25.59
0.19
5.55
27.43
23.57 14.29 28.91
1.43
10.83
28.48
28.01 17.43 40.07
0.23
8.90
33.57
24.96 12.40 29.01
0.00
8.83
37.46
24.65 13.10 25.54
2.93
15.34
41.15
28.39 19.19 33.50
There is huge untapped potential in all the states,
especially Assam , Jharkhand and West Bengal.
Production & Procurement of Wheat
at the National Level
The procurement as % of production has increased from
26% in 2002-03 to approx 42% in 2012-13.
Eastern States Scenario – WHEAT
During RMS 2012-13
Figs in Lakh MTs
Procurement as %
Production Procurement
of Production
State
All India
Eastern States
UP
Bihar
WB
Orissa
Jharkhand
Chattisgarh
Assam
939.03
364.88
302.93
47.87
8.84
0.02
3.35
1.28
0.59
381.48
58.36
50.63
7.72
0.01
0
0
0
0
40.62
15.99
16.71
16.12
Neg.
Nil
Nil
Nil
Nil
There is scope for increasing wheat
procurement in UP and Bihar.
Procurement in major wheat producing Eastern States
has increased substantially in last 6 Years.
(Figures in Lakh MTs)
RMS Year
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
Bihar
0.08
5.00
4.97
1.83
5.56
7.72
U.P.
5.46
31.38
38.82
16.45*
34.61
50.63
* U.P. was in transition phase in RMS 2010-11 from DCP to Non-DCP mode.
Since RMS 2007-08, the procurement in Bihar & U.P. has
shown substantial growth.
System of Procurement - Wheat
Wheat brought to
Mandis
By
Farmers
Unloading &
Cleaning
Inspection, Bidding &
Purchasing
Bagging, Weighment
& Stitching
Loading &
Transportation
(From Mandis to Godowns)
Unloading & Stacking
System of Procurement – Paddy/Rice
Paddy brought to Mandis
By
Farmers
Unloading & Cleaning
Inspection, Bidding & Purchasing
Bagging, Weighment & Stitching
Loading & Transportation
Paddy Purchased by Millers
(Levy Rice)
Paddy Purchased by Govt. Agencies
(Custom Milled Rice)
Paddy unloaded at FCI/St.
Govt. Godown/Rice Mills
Paddy unloaded at Mill
Point
Paddy Issued to Rice Miller
against advance rice
Loading & Transportation to
Mill Point
Paddy Milling
Rice Delivered at procurement
centres/Depots
What is needed for Procurement?

Organized Purchase centres (Mandis)

A dedicated state agency to co-ordinate procurement.

Adequate Financial resources.

Availability of adequate milling capacity for Rice

Adequate storage capacity for both Paddy/Rice and
wheat.

Necessary
logistic
arrangements
infrastructure, trucks, rail linkages etc.
like
road
Credit Limits taken by State Governments / Agencies for
Procurement during 2011-12
Sl No
State
Credit Limit (Rs. Crore)
1.
Chhattisgarh
6,000
2.
Uttar Pradesh
8,361
3.
Bihar
200
4.
West Bengal
155
5.
Assam
Nil
6
Jharkhand
240
7
Odisha
4000
All state Governments can obtain cash credits from RBI for doing
the Decentralized Procurement Operation . Financial resources
will not be a constraint in procurement of food grains.
Position of Milling Capacity
in Eastern States
Sl
No
State
Production of paddy
during KMS 2011-12
(In LMTs)
1
Bihar
2
No. of
Mills
Milling
Capacity per
month
(In LMTs)
94.8
1165
4.63
WB
237.00
1018
4.40
3
Odisha
87.80
1050
4.00
4
Jharkhand
56.10
102
0.35
5
Chattisgarh
94.80
1453
16.30
6
Assam
67.60
927
1.00
7
UP
179.00
3092
20.00
There is tremendous scope of expansion of rice milling industry in
the states of WB, Jharkhand and Assam.
Storage Capacity with FCI and State Govt./Agencies in Eastern States
(As on 01.09.2012)
State
All India
Eastern
States
CHHHTSGR
ASSAM
BIHAR
ORISSA
WEST
BENGAL
JHARKHAND
UP
(Figures in Lakh MT)
Storage Capacity
with FCI
Storage Capacity
with State Agencies
Grand Total
% of capacity with
state agencies
373.30
100.70
341.40
29.90
714.60
130.70
47.8 %
10.1
2.8
7.2
6.2
11.2
1.3
61.8
10.5
2.6
6.6
5.4
3.3
0.2
1.3
20.6
5.4
13.8
11.6
14.6
1.5
63.1
51.50%
48.20%
47.80%
47.30%
22.60%
13.30%
2%
22.9 %
The storage capacity available with State Agencies in Eastern states is only 23 % of the total as
against all India position of 48 %. There is a need to increase the scientific storage capacity by
the state govt. agencies of Jharkhand and West Bengal.
Additional Storage Capacity being created in
Eastern States under PEG Scheme
Sl
No
State
Covered Capacity Additional covered capacity
allotted
under consideration
SILO
capacity
Total
1
Bihar
3.00
4.4
2.00
9.40
2
WB
1.56
3.25
2.00
6.81
3
Odisha
3.00
1.4
0
4.40
4
Jharkhand
1.75
0
0
1.75
5
Chattisgarh
3.2
0
5.42
6
Assam
2.22
3.00*
0
0.50
3.50
7
UP
17.60
12.35
3.00
32.95
32.13
24.60
7.50
64.24
Eastern
States
*Under 2012-17 Plan
Since Govt. of India is creating huge capacity in these states, the
respective State Govts. may also create additional Capacities.
KEY ISSUES of Eastern States from
Procurement perspective
1) Lack of adequate number of organized purchase centres. It
is a problem in all States except Chattisgarh.
2) Inadequate milling capacity. This is a major limiting factor in
Assam Jharkhand and West Bengal and to a lesser extend in
Bihar & Odisha.
3) Geographical imbalances in milling capacity. This issue is
critical in West Bengal and Assam.
4) Imbalances in the geographical distribution of storage
capacities. Bihar and Eastern UP faces this problem. We are
trying to address this issue under PEG scheme.
Special efforts made by FCI for Eastern States
• The criteria for deciding storage capacity requirements under
PEG scheme was expanded to meet future potential.
• FCI has already started movement of food grains by road to
supplement railway infrastructure to ensure speedy
evacuation.
• In DCP States, FCI is accepting stocks from the inception of the
season without waiting for the State to complete
procurement of its quota.
Suggestions for future
 The full potential of Eastern states can be tapped only with active
participation of state Govts.
 Assam, Bihar and Jharkhand may become DCP States, so that they
become self reliant for PDS and have direct connection with the
farmers.
 Infrastructure building initiatives in terms of additional milling and
storage capacity are required to create a conducive environment for
procurement of food grains.
 Apart from the storage capacity being created under PEG by FCI/GoI,
State Governments should also endeavor to create additional storage
capacity especially for intermediate storage.
 State Agencies may build internal competencies for handling
procurement. FCI can impart basic training to staff.
 Multiple agencies/Cooperative Societies are required to be involved to
enlarge the scope of procurement.
22
THANKS