Recent Government Measures to Increase Availability and Contain Food Prices

Recent Government Measures to Increase Availability and Contain Food Prices

Question: Effective governance entails management of country’s resources in an efficient manner. Discuss the recent measures taken by the government of India to enhance availability and contain prices of essential food items.

The following measures have been taken for increasing the availability and containing food prices of essential items:

• Minimum Export price has been fixed at USD 450 per MT for potato and USD 250 per MT for onions

• Free movement of fruits and vegetables through delisting from APMC act has been facilitated for states

• Plan Scheme Price Stabilisation Fund with corpus of INR 500 crore has been approved for:

- Regulation of price volatility of agricultural and horticultural items when there is price rise and vice versa
- Procurement of farm produce
- Maintenance of buffer stocks and regulated release into the market

• States have advised to exempt levy of market fee on fruits and vegetables

• Kisan Mandis have been established where farmers and FPOs can market their produce directly

• Alternative marketing channels are intended for benefiting farmers as well as consumers

• Mission for Integrated Development of Horticulture is also encouraging production of horticultural crops

• Under the Essential Commodities Act, with effect from July 2014, authorised states/UTs will impose stock limits with respect to onion and potato for one year

• Release of extra 5 million tonnes of rice to BPL and APL families till implementation of National Food Security Act

• Centre Advisory to take action against hoarding and black marketing

• Effective enforcement of:

- The Essential Commodities Act, 1955 and
- The Prevention of Black-marketing and Maintenance of Supplies of Essential Commodities Act, 1980

• Authorised states/UTs will impose stock limits in case of essential commodities such as edible oil and oil seeds from time to time

• Essential Commodities Act will be amended to make hoarding and black marketing a non bailable offence and increase period of detention to 1 year

• Government has also approved Open Market sale of 10 million tonnes of wheat in the domestic market in the current fiscal

Facts and Stats

• Food inflation in India fell to 6.14% in March 2015 from 6.79% in February 2015

• Food inflation averaged 9.78% from 2012-2015

• It reached an all time high of 14.72% in November 2013 and record low of 3.14% a year later

• Food inflation is measured by the Ministry of Statistics and Programme Implementation in India