Pro-tribal welfare plan in limbo as government tightens purse-strings

NEW DELHI: The UPA government's ambitious plan to introduce minimum support price for minor forest produce ( MFP) - a pro-tribal welfare measure, especially in Naxal affected districts - is in limbo as the Centre has tightened its purse strings in a desperate bid to curb expenditure.

The Ministry of Tribal Affairs had planned to introduce MSP for 13 non-timber forest produce or MFPs by January 1. It had decided a minimum price would be paid by state corporations to tribals for collecting MFPs. According to the ministry's proposal, in case the corporation made a loss in buying MFPs like tendu leaves and bamboo from tribals because of the minimum price, the Centre would bear it for the first five years.

Though an electorally-sound proposal, the plan is seen by the finance ministry as cash-intensive. The Tribal Affairs Ministry has sought 2,229 crore for five years, including 152.97 crore for 2012-13 fiscal. The scheme, termed as the next rural employment guarantee scheme in Congress, has run into rough weather. According to a source, despite the proposal receiving the Planning Commission approval in June it has hit a hurdle in the finance ministry.

The finance ministry's expenditure finance committee (EFC) has met only once but has not finalised anything on the issue. A senior official of the ministry told ET: "With austerity measures in the government in place, there was a decision of the finance ministry that no new EFCs would be held on any issue after September. The first meeting on MSP issue had taken place before September, but no decision was taken. The meetings have been postponed twice unofficially. Even before meeting notices are issued there is a postponement."

The ministry had expected to get the necessary approvals by October to launch the programme on January 1, 2013. However, the launch of the programme would obviously be postponed.