NEW DELHI: Low offtake of foodgrain by states and overflowing stocks in Food Corporation of India (FCI) godowns have landed the Government in the happy situation where it will save at least Rs 10,000 crore in the seventh and final phase (Oct-Dec 2022) of the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) and upwards of Rs 25,000 crore for the whole of the current financial year.
This is against a total outlay of Rs 1.3 trillion for the April-December 2022 period.
According to sources quoted in media reports, states have not lifted a quarter of 12 million tonne (MT) allocated under the free ration scheme for its seventh phase. With this, the total savings against allocation of Rs 3.91 trillion since the scheme’s inception in April 2020 will be above Rs 40,000 crore, they added.
The Food Ministry had informed states that lifting of foodgrain under the scheme would be allowed only till December 31, 2022. Last week, the Cabinet decided against extending the scheme.
Lower lifting of stocks by the states would boost grain stocks, especially wheat, with FCI and will help the corporation carry out open market sale (OMS) to bulk buyers this month. According to estimates, against an allocation of 2.11 MT of wheat to be distributed under PMGKAY during Oct-December 2022, states lifted 1.87 MT. In case of rice, states took possession of 7 MT against an allocation of 9.89 MT.
While stating that there are sufficient food grain stocks in the central pool to meet the requirement under the National Food Security Act (NFSA) and free ration scheme and other welfare programmes, the Food Ministry last month had said that about 15.9 MT of wheat will be available as on January 1, 2023, which is well above the buffer.
The Government’s food subsidy expenses in the current fiscal are likely to cross Rs 2.76 trillion, up 34 pc from the outlay at the beginning of the year. The annual cost to the exchequer for providing free grain under NFSA is estimated at Rs 2 trillion for 2023-24, including the additional cost of around Rs 20,000 crore for making NFSA grain supply in 2023 totally free of cost to beneficiaries
