Cabinet to mull ways to vacate state godowns

NEW DELHI: The Cabinet is likely to discuss economic measures to vacate government’s godowns choked with wheat ahead of the new harvest season. “We will take up this matter with the Cabinet on Thursday. We need to offload wheat in the market to create space for the new harvest,” said agriculture minister Sharad Pawar. He said that the country was likely to get another bumper crop this year with favourable conditions.

“Rains have helped the wheat crop. We expect wheat production closer to the last year. However, oilseed will be hit,” he said. Meanwhile, the food ministry is likely discuss a proposal on lowering wheat prices by Rs 2 a kg to be sold to biscuit makers, flour millers and food processors. It plans to sell the grain at a price covering the minimum support price of Rs 1,285 a quintal plus freight charges from Food Corporation of India godowns at Ludhiana.

“We will absorb state taxes and will not pass on to these bulk consumers,” said a food ministry official. The government currently sells wheat in open market at a price covering the minimum support price of Rs1,285 a quintal and state levies in addition to freight charges. The prices vary across states between Rs1,404 and Rs1,550 a quintal.

The government has allocated 6.5 million tonne wheat for sale in open market, of which only 3 million tonne has been lifted due to higher prices. The Cabinet may also discuss allowing more wheat exports to cut huge stocks at government warehouses.

It has allowed 4.5 million tonne of wheat exports and may permit another 4.5 million tonne shipments out of government warehouses through private players. At present, only stateowned companies like STC and MMTC are exporting the grain.