India Leaf

GPS in PDS Vehicles

2012-11-29T20:10:00.000+05:30

Installation of Global Positioning System (GPS) sets had been taken up for implementation in 11th Five Year Plan on pilot basis in States of Tamil Nadu and Chhattisgarh for tracking the movement of vehicles transporting Targeted Public Distribution System (TPDS) commodities. This information was given by the Minister of State (IC) for Consumer Affairs, Food & Public Distribution Prof. K.V.Thomas in a written reply in the Lok Sabha.

The Minister said that State Government of Tamil Nadu, who have implemented the scheme in two districts, have reported that it has helped in the quantities of food grains allotted from Food Corporation of India (FCI) to the intended godowns reaching without diversion; created moral fear among those involved in transportation of PDS items; enabled tracking the movement of vehicles carrying PDS items at short notice and avoided delays in transportation. State Government of Chhattisgarh has intimated that after installation of GPS sets in trucks transporting TPDS commodities, they are reaching their destination properly and no irregularities have since been found.

Prof. Thomas said that in view of the feedback received from these State Governments, it has been decided to extend this scheme to all the States/UTs. This Department had taken up a pilot scheme on Computerization of TPDS Operations to be implemented in 3 districts of 4 States i.e. Andhra Pradesh, Assam, Chhattisgarh and Delhi. As reported by these States, digitization of databases and computerization of supply- chain management have been completed in Delhi and Chhattisgarh. In Andhra Pradesh, entire ration card database has been digitized and supply-chain computerization is in progress. In the State of Assam, work of digitization of databases is being undertaken. Another scheme for Smart Card based delivery of essential commodities is being undertaken on pilot basis in Chandigarh UT and Haryana. In the State of Haryana, the project has been implemented in 4 blocks whereas in Chandigarh UT, it has been completed in 13 Fair Price Shops (FPS). These pilot schemes are proposed to be subsumed under the Plan Scheme on End-to-end Computerization of TPDS Operations, which is being implemented in all States/UTs.

100% FDI Permitted for Cold Storage Facilities

2012-11-29T20:01:00.000+05:30

In order to increase Foreign Direct Investment (FDI) in cold storage sector, Government has permitted 100% FDI under automatic route as per the extant FDI policy. This policy mandates minimum investment of US$ 100 million with at least 50% of total FDI being invested in `back-end infrastructure` within three years of the first tranche of FDI, where `back-end infrastructure` will include capital expenditure on all activities, excluding that on front-end units.

The Government is implementing following schemes which have components for increasing cold storage capacity aimed at checking wastage of horticulture and agriculture produce:

1. National Horticulture Mission.

2. Horticulture Mission for North East and Himalayan States.

3. National Horticulture Board.

4. Scheme of Ministry of Food Processing Industries.

5. Scheme of Agricultural Processed Food Products Export Development Authority.

6. National Cooperative Development Corporation.

Further, Government has included capital investment in creation of modern storage capacity including cold chains and post-harvest storage as an eligible sector for viability gap funding under "support to public private partnership in Infrastructure scheme".

All India Coordinated Research Project on Post-harvest Technology (ICAR) conducted a study at National level and printed the report in September, 2012. As per the study, estimated monetary value of harvest, post-harvest losses of horticultural, agricultural and livestock produce, in the country was Rs. 44143 crore at price and production value for the year 2007 - 08.

This information was given by Shri Tariq Anwar, Minister of State for Agriculture and Food Processing Industries in written reply to a question in the Lok Sabha on 27th November 2012.

Sugar Productions Sufficient to Meet Requirement

2012-11-28T11:30:00.000+05:30

India's domestic sugar production in the current sugar season 2012-13 is estimated to be sufficient to meet the estimated domestic consumption requirement, according to a latest press release from the Ministry of Consumer Affairs. As such, large surplus production of sugar in this season is not expected at present. Changes in export policy would be made, if considered appropriate depending upon the production, availability and international as well as domestic prices of sugar. As regards revision of import duty, no decision has been taken by the Government so far. The production, demand, import and export of sugar during each of last three sugar seasons and the estimated figures for 2012-13 are as under;

As per the data published by Directorate General of Commercial Intelligence and Statistics, Kolkata export of sugar from India during last three sugar seasons have been mainly to Bangladesh, Sri Lanka, Dijibouti, Indonesia, Malaysia, Pakistan, Somalia & UAE etc and import of sugar in India was mainly from Brazil, Thailand, Myanmar, South Africa, Argentina and UAE etc. There had been hardly any export/import of sugar during current sugar season 2012-13 so far. No incentive/assistance was provided to the exporters during the said period.

Veg oil imports cross 10 million tonne-mark in 2011-12

2012-11-16T19:23:00.000+05:30

India's vegetable oil imports surged by 17 per cent crossing 10 million tonnes mark in the 2011-12 marketing year that ended last month on strong domestic demand as per industry body Solvent Extractors Association of India (SEA).The country had imported a total of 8.7 million tonnes of vegetable oil comprising both edible and non-edible oils in the 2010-11 marketing year (November-October). The total import of edible oil during November 2011 to October 2012 is reported at 99.81 lakh tonnes, doubled in six years.

According to Solvent Extractors Association of India (SEA), "Local consumption increased by up to 8,00,000 tonnes due to a rise in per capita consumption and population growth. Lower price of vegetable oils also boosted consumption during the year."

The overall import of vegetableoil has increased by 15.2 lakh tonnes (17.5%) during oil year 2011-12(Nov.-Oct) over the previous year. The main reasons for increase in import of vegetable oil are:
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i) The overall production of veg. oils was down by about 7.0 lakh tonnes due to reduced oilseed crop during 2011-12,

ii) Local consumption increased by about 7.5 to 8.0 lakh tonnes due to increase in per capita consumption (3%) and population growth (1.76%). Also lower price of veg. oils boost the consumption of veg. oils during the year.

iii) Closing stock of imported veg. oils as on 31st October increased by 2.60 lakh tonnes to 15.70 lakh tonnes.

iv) Malaysia and Indonesia pushed the palm oil export into India during the year to reduce their excessive stock burden.

v) Due to inverted export duty structure by Indonesia, import of RBD Palmolein substantially increased during the year.

vi) The overall consumption increased by about 12.5 lakh tonnes, leading to higher import during the year

Current stock of edible oils as on 1st November, 2012 at various ports is estimated at 920,000 tonnes (CPO 600,000 tonnes, RBD Palmolein 95,000 tonnes, Degummed Soybean Oil 125,000 tonnes, Crude Sunflower Oil 85,000 tonnes and Canola Rape Oil 15,000 tonnes) and about 650,000 tonnes in pipelines. Closing stock increased by 2.60 lakh tonnes at the end of the year and reported at 15.70 lakh tonnes.

During Oil Year 2011-12(Nov-Oct) Palm Oil import increased to 76.69 lakh tonnes compared to 65.47 lakh tonnes during the last year and the same time soft oil import also increased to 23.12 lakh tonnes, consisting of 10.79 lakh tonnes of soybean oil, 11.35 lakh tonnes of sunflower oil, 0.91 lakh tonnes of rape oil and 0.07 lakh tonnes of other soft oils compared to 18.24 lakh tonnes during the same period of last year.

Export of oil meals between April - October 2012 down by 30%

2012-11-07T20:08:00.001+05:30

The Solvent Extractors’ Association of India has just compiled the export data for export of oil meals for the month of October 2012. The export of oil meals during October 2012 is reported at 121,919 tonnes compared to 354,698 tonnes in October 2011 i.e. down by 66%. The total export of oil meals during April to October 2012 has reduced and reported at 1,724,984 tonnes compared to 2,451,499 tonnes during the same period of last year i.e. down by 30%. High price of soybean seed resulted into lesser crushing and availability of soybean meal for local as well as for the export. Lack of buying by Iran and disparity in export of soybean meal due to high price in local market resulted into steep fall in its exports.

South Korea – Highest Importer of Oil meals from India:

Oil meal import by South Korea from India during April to Oct., 2012 is reported at 492,286 tonnes compared to 378,746 tonnes last year consisting of 55,202 tonnes of soybean meal, castor meal of 203,722 tonnes and 233,362 tonnes of rapeseed meal. Vietnam another major market, imported of 228,488 tonnes compared to 314,727 tonnes last year consisting of 47,685 tonnes of soybean meal, 27,889 tonnes of rapeseed meal, 1,412 tonnes of groundnut meal, 502 tonnes of castor meal and entire quantity of 151,000 tonnes of rice bran extraction. Japan imported 106,923 tonnes compared to 615,377 tonnes of last year consisting of 106,545 tonnes of soybean meal, 279 tonnes of rapeseed meal and 99 tonnes of castor meal.

Thailand imported of 121,914 tonnes compared to 161,238 tonnes, consisting 61,334 tonnes of soybean meal, 60,491 tonnes of rapeseed meal and small quantity of 89 tonnes of Castor meal. Indonesia imported 104,064 tonnes compared to 128,591 tonnes consisting of 74,813 tonnes of rapeseed meal and 29,251 tonnes of soybean meal. Iran imported of 456,687 tonnes compared to 175,962 tonnes, consisting 440,687 tonnes of soybean meal, and 16,000 tonnes of rapeseed meal. Europe and others have imported 31,326 tonnes compared to 49,833 tonnes of last year.

Port-wise Export: April-Oct., 2012

The export from Kandla is reported at 1,173,079 tonnes (68%), followed by Mumbai including JNPT handled 189,838 tonnes (11%), Mundra handled 113,189 tonnes (7%),Bedi handled 79,290 tonnes (5%) ,Kolkata handled 151,000 tonnes (9%) and Vizag handled 10,243 tonnes (1%).

Government Raises Minimum Support Price for Rabi Crops

2012-11-03T16:06:00.003+05:30

The Cabinet Committee on Economic Affairs (CCEA) on Thursday raised the minimum support price (MSP) for rabi crops such as mustard seeds, grams and lentils by seven-20 per cent. However, the CCEA did not take a decision on the wheat MSP for the 2013-2014 crop marketing season (April-March).

An official statement said that the CCEA approved raising the MSP of grams and masur (lentil) by Rs 100-200 a quintal to Rs 3,000 for gram and Rs 2,900 for lentil for the April 2013-March 2014 marketing year. The Cabinet has also approved increasing the MSP of mustard seeds from Rs 2,500 crore a quintal to Rs 3,000 a quintal for the 2013-14 marketing year and from Rs 2,500 to Rs 2,800 for safflower.

Among cereals, the official statement said that the CCEA has frozen the support price of barley at Rs 980 a quintal for 2013-14.

Carrying Identity Card Mandatory for Reserved Train Tickets

2012-11-01T19:59:00.000+05:30

In a major initiative to further facilitate the travel of bonafide and legitimate passengers and to reduce the scope for misuse of reserved ticketing system by unscrupulous elements/middlemen, the Ministry of Railways has decided to extend the condition of carrying original proof of identity during travel on reserved tickets issued through Passenger Reservation System (PRS) for all reserved classes including ‘Reserved Second Class (2S)’, ‘Sleeper Class (SL)’, ‘III Economy Class (3E)’ and ‘First Class (FC)’. This change in policy will come into effect from 1st December 2012.

Further, the Ministry of Railways has also decided to expand the list of prescribed proofs of identity to include photo identity cards having serial numbers issued by public sector undertakings of State/Central Government, District Administrations, Municipal Administrations and Panchayat Administrations.

The expanded list of the prescribed proofs of identity for undertaking journey on Tatkal ticket and other reserved classes will now be as follows:

1. Voter Photo identity card issued by Election Commission of India.
2. Passport.
3. PAN Card issued by Income Tax Department.
4. Driving Licence issued by RTO.
5. Photo identity card having serial number issued by Central/State Government which include the following:
(i) Pension Pay Order s(PPO)
(ii) Ration Card with photographs
(iii) Senior Citizen cards
(iv) Below Poverty Line (BPL) cards
(v) ESI cards (with photograph) issued for taking treatment in ESI dispensaries.
(vi) CGHS Cards (with photograph) issued to individual family members of Central Govt. employees.
6. Student Identity Card with photograph issued by recognized School/College for their students.
7. Nationalized Bank Passbook with photographs.
8. Credit Cards issued by Banks with laminated photograph.
9. Unique Identification Card “Aadhaar”.
10. Photo identity cards having serial number issued by Public Sector Undertakings of State/Central Government, District Administrations, Municipal bodies and Panchayat Administrations.

In this way, the new provision to be effective from 1st December, 2012 will be as follows :-

“Any one of the passengers booked on a PNR for undertaking journey in any reserved class has to produce any one of the above mentioned prescribed proofs of identity in original during the journey failing which all the passengers booked on that ticket will be treated as travelling without ticket and charged accordingly. The existing provision of the Tatkal scheme where the passenger is required to show the same original proof of identity as indicated on the ticket shall continue.”

It may be mentioned that presently only the following categories of passengers travelling in reserved classes have to produce original proof of identity during the journey:-
Passengers travelling on e-tickets.
Passengers travelling on Tatkal tickets.
Passengers undertaking journey in AC classes on the tickets issued through the computerized Passenger Reservation System (PRS) {except in III Economy -3E class}.

With the new provision, the condition of carrying one of the prescribed identity cards has now been extended additionally to other classes of travel namely - Reserved Second Class(2S), Sleeper Class(SL), III Economy Class(3E) and First Class(FC).

The above change in the policy is aimed at facilitating the travel of bonafide and genuine passengers and simultaneously to check the scope for travel on transferred tickets. It is also considered that the proposed change shall also be useful from the security point of view.

Sun sets on Analogue Cable TV Networks in 4 Metros

2012-11-01T19:31:00.000+05:30

Analogue Cable Television signals were switched off by the Broadcasters and Multi System Operators (MSOs) at midnight of 31st October, 2012 in Delhi, Mumbai and Kolkata. Analogue Cable TV signals were allowed to continue in Chennai due to the interim stay granted by the Hon’ble High Court of Madras.

A total of 64.31 lakh Set Top Boxes (STBs) have been installed in the 4 metro cities in the first phase of digitization during the span of about 10 months from November 2011 i.e from the date of notification .First phase of digitization covers 4 metro cities of Delhi, Mumbai, Kolkata and Chennai. As per 2011 Census figures, a total of 103.76 lakh households are there in 4 metro cities. At an average rate of 80% TV penetration as per the Census, the Ministry of Information and Broadcasting had estimated that about 82.59 lakh households will have TV sets. After deducting 28.14 lakh DTH connections , it was estimated that there would be 65.34 lakh Cable TV subscribers who would require Set Top Boxes.

As per the data provided by the MSOs , the percentage of digitization in Delhi has gone up to 101%. In Mumbai it is 118% whereas in Kolkata it is 85% and in Chennai it stands at 63%.

The ‘Blackout Advertisement’ carried out by the Ministry on all prominent Television channels created a massive public awareness about the digitization deadline. More than 200 channels carried the ‘blackout advertisement’ of the Ministry on the same day and time in a synchronized fashion which is a record of sorts.

Ministry has been closely monitoring procurement and progress of installation of STBs by various MSOs regularly. Additionally, data was also collected from DTH operators on a daily basis. A Special Task Force was constituted to steer the entire process which consisted of various stakeholders. The Task Force met on fortnightly basis and held 20 meetings so far.

Digital Cable TV system has a number of inherent advantages such as Electronic Programme Guide (EPG) which gives the information for the current programme as well as the programmes to come up. It also provides features like Movies-on-Demand and Games. A cable subscriber in digital system has facility to log in their complaints either on the Toll free number or in the Subscriber Complaint Redressal System on the web, wherein redressal of the complaint can be tracked. The consumer has a choice to select channel packages as per their choice or to select from a-la-carte list. The bill is generated by the system as per the channels chosen by the Cable subscriber. In addition to these special features the digital cable TV system provides superior picture and sound of digital quality and the consumer have a choice to select from a wide range of channels which was limited to only about 80-90 channels in an analogue system. The consumer can also subscribe to the HD channels. Digital Cable TV system will also enable the provision of Triple Play services on the same Cable TV network wherein in addition to the TV programmes, internet, radio, telephony etc., would also be available through the same cable line.

Ministry has instructed all MSOs to certify that their analogue signals have been switched off completely. They have also been asked to set up canopies/kiosks in poorer colonies to ensure Set Top Boxes are made available to them at the determined price of Rs 799/-on the spot. MSOs have also been asked to ensure the consumer is not overcharged for the Set Top Boxes. MSOs have also been advised to advertise their complaint number so that nobody takes any undue advantage of the situation.

The technical teams deployed by the Ministry in the field are constantly on the move to inspect the head ends of the MSOs in Delhi and Mumbai. It has been reported that analog signals have been switched off from all the head ends in Delhi and Mumbai while Kolkata has given mixed reports.

Commexes turnover down 4.5% till October 15 in FY'13

2012-10-26T15:43:00.000+05:30

The turnover of commodity bourses has declined 4.5 per cent to Rs 94.72 lakh crore till October 15 this fiscal due to sluggish investor participation in gold and silver futures, according to regulator FMC.

The exchanges had clocked a turnover of Rs 99.18 lakh crore in the year-ago period.

Except for bullion, there was substantial increase in the turnover of energy, metals and agricultural commodities during the period under the review, the Forward Markets Commission (FMC) said on its website.

The business from energy items like crude oil rose by 42 per cent to Rs 20.79 lakh crore during the April-October 15 period of the 2012-13 fiscal, against Rs 14.61 lakh crore in the same period corresponding year.

While turnover from metals like copper increased 23 per cent to Rs 17.29 lakh crore from Rs 14.10 lakh crore, the business from farm items rose by 28 per cent to Rs 12.88 lakh crore from Rs 10.09 lakh crore in the period under the review, according to the FMC data.

However, turnover from bullion fell 28 per cent to Rs 43.75 lakh crore during the period, from Rs 60.36 lakh crore a year ago.

On falling business volumes, FMC Chairman Ramesh Abhishek had recently said that the regulator was "more concerned about quality of turnover not on quantity".

At present, the country has five national and 16 regional level commodity exchanges in the country. Recently, the FMC gave approval to the Universal Commodity Exchange to operate as a national bourse.

India's import of vegetable oils up by 18%

2012-10-24T13:49:00.000+05:30

As per the latest data released by the Solvent Extractors’ Association of India (SEA), import of vegetable oils (edible & non-edible) during first eleven months of current oil year indicates 17.80% increase in import. Import during September 2012 is reported at 993,912 tonnes compared to 912,341 tonnes in September 2011, consisting of 976,417 tonnes of edible oils and 17,495 tonnes of non-edible oils i.e. up by 8.94%. The overall import of vegetable oils during November 2011 to September 2012 is reported at 9,156,457 tonnes compared to 7,773,184 tonnes i.e. up by 17.80%.

Surged in Import of Sunflower Oil:

During Nov., 2011 to Sept., 2012 import of sunflower oil is reported at 1,049,181 tonnes compared to 739,173 tonnes during the same period of last year. Sunflower oil is a major contributor in meeting demand for soft oil, as sunflower oil prices have been attractive compared to soybean oil. Currently the premium on sunflower oil over soybean oil is just US$ 11 per ton and also sunflower oil is preferred oil by housewives in India. Also, India has started importing canola oil and bought about 90,000 tonnes during last 8 months compared to 3,601 during same period of last year, mainly due to lesser local crushing of rapeseed due to disparity.

Stock Position at Port and in Pipelines:-

Current stock of edible oils as on 1st October, 2012 at various ports is estimated at 880,000 tonnes (CPO 510,000 tonnes, RBD Palmolein 110,000 tonnes, Degummed Soybean Oil 130,000 tonnes, Crude Sunflower Oil 115,000 tonnes and Canola Rape Oil 15,000 tonnes) and about 570,000 tonnes in pipelines. Total stock, both at port and in pipelines is decreased by 100,000 to 1,450,000 tonnes due to reduced local production and festival demand compared to last month.

Import of Non-edible oils during September 2012 is reported at 17,495 tonnes compared to 33,472 tonnes during the same period last year. The overall import of non-edible oil during Nov., 2011 to Sept., 2012 is reported at 193,104 tonnes compared to 279,524 tonnes during the same period of last year i.e. down by 31%.

Prime Minister Emphasizes Balance between RTI & Right to Privacy

2012-10-14T14:44:00.000+05:30

Prime Minister Manmohan Singh on Friday called for maintaining a “fine balance” between the Right to Information (RTI) and the right to privacy, the latter of “which stems out of the Fundamental Right to Life and liberty. The citizens’ right to know should definitely be circumscribed if disclosure of information encroaches upon someone’s personal privacy.”

Following is the text of the Prime Minister’s address at the Annual Convention of Information Commissioners:

The Right to Information act has been in force in our country for seven years now. By all accounts it has contributed in very large measure to our efforts for ensuring greater probity, greater transparency and greater accountability in the work of public authorities. The greater public scrutiny of government action that it has enabled has been, I believe, good for our country. I congratulate all those who have been associated with the implementation of this very important piece of legislation, the Right to Information act in the past seven years.

In the last year itself close to 10 lakh people, in all parts of our country sought information from the Central government authorities under this legislation. Today, citizens everywhere feel empowered because of the Right to Information Act. It is a simple and uncomplicated legislation, easy to understand and use. And this I think is one of its major strengths.

It is a pointer to the success of the Right to Information that only about 4.5 percent of the applications that are filed before Central government authorities reach the Information Commissions for adjudication. It is estimated that out of the 20,000 appeals and complaints disposed of by the Central Information Commission every year on the average, only a couple of hundred cases a year have been challenged in our courts.

Notwithstanding its successes, I believe that the Right to Information is still evolving in our country. The potential for good, constructive use of this Right is perhaps far greater than what its current status would indicate. But this potential cannot be realized automatically. It would require concerted efforts towards removing the impediments that at present reduce its efficacy.

There are some obvious areas of concerns about the way the Right to Information Act is being used presently, and I had flagged a few of them when I addressed this Convention last year. There are concerns about frivolous and vexatious use of the Act in demanding information the disclosure of which cannot possibly serve any public purpose. Sometimes information covering a long time-span or a large number of cases is sought in an omnibus manner with the objective of discovering an inconsistency or mistake which can be criticized. Such queries besides serving little productive social purpose are also a drain on the resources of the public authorities, diverting precious man-hours that could be put to better use. Such requests for information have in fact come in for adverse criticism by the Supreme Court as well as the Central Information Commission.

Concerns have also been raised regarding possible infringement of personal privacy while providing information under the Right to Information Act. There is a fine balance required to be maintained between the Right to information and the right to privacy, which stems out of the Fundamental Right to Life and liberty. The citizens’ right to know should definitely be circumscribed if disclosure of information encroaches upon someone’s personal privacy. But where to draw the line is a complicated question. I am happy that this Convention will devote an exclusive session to "Privacy and Disclosure Issues", which I hope will result in useful, constructive recommendations. The issue of a separate legislation on privacy is under consideration of an expert group under Justice A. P. Shah.

There are other issues as well which need to be addressed. For example, how much information should entities set up in the Public Private Partnership be obliged to disclose under the Right to Information Act. Blanket extension of the Act to such bodies may discourage private enterprises to enter into partnerships with the public sector entity. A blanket exclusion on the other hand may harm the cause of accountability of public officials. I am sure that you will discuss such issues in this Convention with a view to finding a way forward.

I know that there has been some confusion about the implications of the recent Supreme Court order regarding the composition of the Central and State Information Commissions. As you might be aware, the government has decided to go in review before the Supreme Court in this matter.

The public authorities also have an important part to play in bringing about improvements in the implementation of the Right to Information Act. There are costs associated with providing access to information. It must be our endeavor to minimize these costs. Better training of employees, greater use of modern technology and proactive disclosure of the maximum possible amount of information are obvious solutions, not only for minimizing costs but also for making it easier for people to access information. In some places there may also be a need to change perceptions about the Right to Information- it should not be viewed as an irritant but something that is good for all of us collectively.

Rights, of course, cannot stand in isolation and must always be accompanied by reciprocal obligations. I had pointed out in my address to this Convention in 2008 that while asserting our rights we need to be equally conscious of our responsibilities and our commitments. I believe that all of us share a responsibility to promote more constructive and productive use of the Right to Information Act. This important legislation should not be only about criticizing, ridiculing, and running down public authorities. It should be more about promoting transparency and accountability, spreading information and awareness and empowering our citizen. I think that there is need for all of us to work towards building an environment where citizens see the government as a partner and not as an adversary.

The Right to Information Act is one of the many steps our government has taken for strengthening the institutional architecture for curbing corruption, enhancing transparency and accountability in public administration and improving delivery of services to the people. Other important legislations that are proposed include the Whistle blowers Protection Bill, the Time-bound Delivery of Goods and Services and Redressal of Grievances Bill and the Electronic Delivery of Services Bill, which are all currently under consideration of our Parliament. We have also put in place a National Data Sharing and Accessibility Policy. Recently we have taken an initiative to facilitate direct cash transfer of government benefits to public accounts of beneficiaries. This would help in reducing leakages and wastage, and also make it easier for our citizens to avail of governmental assistance.

I believe that the Right to Information can be utilized for even better results to the benefit of our country and our people. It needs to be remembered that the ultimate goal of the legislation is to induce more efficiency in the work of our government and help it serve our people better. I hope you will utilize this Convention to find ways and means to achieve this objective more effectively. I wish you success in your deliberation.”

Report of the Rangarajan Committee on Deregulation of Sugar Sector in India

2012-10-14T14:34:00.000+05:30

Prime Minister had set up a committee under the chairmanship of Dr. C. Rangarajan, Chairman, Economic Advisory Council to the Prime Minister to look into all the issues relating to the deregulation of the sugar sector. The committee has completed its task, after several rounds of deliberations, consultations with stakeholders, and discussion with Chief Ministers of major sugar-producing states. The report was submitted to the Prime Minster on 10-10-2012. Following are the excerpts from the report:

1. A major recommendation of the committee relates to revising the existing arrangement for the price to be paid to sugarcane farmers, which suffers from problems of accumulation of arrears of cane dues in years of high price and low price for farmers in other years. The existing arrangement comprises a Fair and Remunerative Price (FRP) announced each year by the Centre, under the Sugarcane Control Order and on the advice of CACP, as the minimum price of sugarcane. However, many states in north India also announce a State Advised Price (SAP) under state legislation. Generally, the SAP is substantially higher than the FRP, and wherever SAP is declared, it is the ruling price. Instead of the present arrangement, the committee has proposed that at the time of cane supply, farmers be paid FRP as the minimum price, as at present. Further, subsequently, on a half-yearly basis, the state government concerned would announce the ex-mill prices of sugar and its by-products, and farmers would be entitled to a 70% share in the value of the sugar and by-products produced from the quantity of cane supplied by each farmer. Based on the share so computed, additional payment, net of FRP already paid, would then be made to the farmer. Since the sugar value estimate includes return on capital employed, this implies that farmers would also get a share of the profits. With such a system in operation, states should not declare an SAP.

2.The committee has also recommended dismantling of the levy obligation for sourcing PDS sugar at a price below the market price. States should be allowed henceforth to fix the issue price of PDS sugar, while the existing subsidy to states for PDS sugar transport and the difference between the levy price and the issue price would continue at the existing level, augmented by the current level of implicit subsidy on account of the difference between the levy price and the open market price. This will free the industry from the burden of a government welfare programme, and indirectly benefit both the farmer and the general consumer since the industry passes on the cost of levy mechanism to farmers and consumers.

3. The committee has recommended dispensing with the present mechanism of regulated release of non-levy sugar, as it imposes additional costs on factories on account of inventory accumulation.

4. The committee has recommended that cane area reservation ultimately be phased out and contracting between farmers and mills allowed for enabling theemergence of a competitive market for assured supply of cane, in the interest of farmers and economic efficiency. However, in case some states want to continue it for the time being, they should do so while ensuring that area reservation is done for at least three to five years at a time, so that industry has a stake in its development. Further, wherever and whenever a state discontinues area reservation, the Centre should remove the stipulation of a minimum distance between two mills.

5. On external trade, the committee has favoured a stable policy regime with modest tariff levels of 5% to 10% ordinarily, and dispensing with outright bans and quantitative restrictions. The committee has also recommended dispensing with the mandatory requirement of jute packaging. In respect of molasses, the committee favours free movement and dismantling of end-use based allocation quotas that are in vogue in several states, to enable creation of a national market and better prices for this valuable by-product as well as improved efficiency in its use.

Inaugural Address by the Union Finance Minister P Chidambaram at the Economic Editors’ Conference 2012

2012-10-08T20:45:00.000+05:30

“On behalf of Government of India, I welcome you to the Economic Editors’ Conference. Economic journalists, especially those who are based in places other than the capital, look forward to this annual interaction. So do we, because economic journalists play a vital role in market based economic systems. They build public opinion, communicate information, and transmit economic realities, which in turn influences political decision making.

The Global Setting

These are challenging times for the global economy. Against the backdrop of a slow recovery from the global economic crisis of 2008, economic problems in Europe have emerged as another threat to the global financial system. This uncertainty is affecting market sentiments everywhere and dampening the prospects of an upturn in the global economy. The world economy achieved a GDP growth of 5.3 per cent in 2010. The rate of growth declined to 3.9 per cent in 2011 and is expected to decline further to 3.5 per cent in 2012. The rate of growth of Advanced Economies halved from 3.2 per cent in 2010 to 1.6 per cent in 2011 and is expected to decline further to 1.4 per cent in 2012.

Our Economic Challenges

As can be expected, the Indian Economy has not been immune to these developments. It registered a growth of 6.5 per cent during 2011-12 in terms of gross domestic product at factor cost at constant 2004-05 prices and in Q1 of 2012-13 the provisional estimate of growth is 5.5 per cent. However, we would do well to remember that, out of 8 years, it is only in two years, 2008-09 and 2011-12 that the GDP grew at below 7 per cent. It is indeed a matter of concern that the growth rate dipped in two years but there is no cause for gloom or despondency. I may point out that, even at a low growth rate of 6.5 per cent, India was among a handful of countries that recorded significant growth in that year.

The slowdown in growth is attributable mainly to the global economic situation, high commodity prices, inflation and a decline in investment. Government responded to the declining trend in the growth rate by increasing public expenditure. However, in the absence of matching revenues, a rise in expenditure led to a rise in the fiscal deficit. Inflation also rose. The burden of containing inflation fell, largely, on the Central Bank. The Reserve Bank of India was obliged to follow a tight monetary policy. Overall inflation declined from 9.8 per cent in August, 2011 to about 7.55 per cent in August, 2012, but still remains unacceptably high. A tight money policy has dampened investment as well as growth, particularly in the industrial sector. I think all of us would do well to note the limitations of monetary policy action. It is Government’s firm belief that fiscal policy and monetary policy should work in tandem so that the common objectives of containing inflation and stimulating growth are achieved.

Let me say a few words on inflation. It has been an issue of persistent concern over the past few years. We have seen some moderation in recent months. Inflation measured in terms of WPI has been in the range of 7-7.6 per cent in the recent months as a result of the measures taken by the Government and the Reserve Bank of India. WPI inflation in August 2012 stood at 7.55 per cent. However, with food inflation continuing to be high, we must take more steps in order to contain inflation.

Restoring Growth: The Current Reforms

Growth comes from higher investment. We achieved a high investment rate of 38 per cent in 2007-08 and in that year the GDP grew at 9.3 per cent. Hence, the foremost task before us is to promote savings, channelize the savings into investments, and achieve a rate of investment of 37-38 per cent of GDP. At that level, given India’s incremental capital-output ratio, I am certain that growth will recover to 8 per cent or more and perhaps touch 9 per cent. While it would be premature and ambitious to talk of 9 per cent growth, we should keep that rate of growth as our objective and progress towards achieving that objective. It is in this context that the 12th Plan has projected an average growth rate of 8.2 per cent with growth in the terminal year projected at 9 percent.

Long-standing structural reforms required to achieve high investment and high growth rates have been held back because of many reasons. Among them are the concern to protect the flagship programmes that have been designed to benefit the poor; the need to forge a consensus on reforms; the practical necessity to garner support across the political spectrum to pass legislation; and the assertion of States’ rights that sometimes turns into opposition to structural reforms. Nevertheless, we are now addressing the difficult areas of reforms.

I consider that it is my duty to place before the people the truth. India’s economy is challenged. The state of the economy is reflected by universally accepted indicators such as the fiscal deficit, the revenue deficit and the current account deficit. Let me tell you the plain truth. Without reforms, we risk a sharp and continuing slowdown of the economy which we cannot afford given the imperative need to generate jobs and incomes for a large population, most of whom are young. For example, take FDI in retail. What is the controversy about? The first comprehensive Cabinet paper on FDI in retail was prepared by the NDA Government in 2002. It was considered by a Group of Ministers. That paper acknowledged that FDI in retail was essential to improve the supply chain in agriculture which alone will bring benefits to both producers and consumers. That paper also endorsed the argument that FDI in retail will generate millions of jobs. The idea was never rejected. So, why should there be a controversy when the Government announced its intention to lay down guidelines in order to enable FDI in retail? Government has also made it clear that the ultimate decision whether FDI in retail will be allowed in any State will rest with the State Government concerned. No State can say that other States should also allow FDI in retail; similarly no State can say that other States should not allow FDI in retail. The controversy over FDI in retail is, in my view, unnecessary and unjustified.

There should also be no controversy over reforms in the coal, mining, power, petroleum & natural gas, and infrastructure sectors including roads, railway and shipping. It is these sectors that are the drivers of growth. It is these sectors that will create millions of jobs. It is these sectors that will produce the goods and services that will benefit the people of India. Every Government is entitled to lay down policies. Opposition to policies is legitimate, obstructionism is not. The Government of the day must be allowed to lay down policies, pass legislation wherever necessary, and get on with the job of implementing those policies. Whether the policies are right or wrong and whether the policies have brought benefit to the people are matters on which the people alone can pass a judgment. Under our system there is a judgment day for every Government at the end of five years.

Recent measures

Many steps have been taken in the last few weeks to get rid of the sense of stagnation and to get on with the task of restoring high growth. I have spoken on a few occasion on the measures taken by the Government and hence I shall not repeat the arguments today. However, if you have any questions or doubts on the steps taken by the Government in recent weeks, I shall be happy to answer them.

Let me list a few issues and explain them briefly so that our interaction today will be meaningful.

Firstly, the imperative need of fiscal consolidation. No one will have confidence in the Indian economy if there is uncertainty about the fiscal stability of the country. The recommendations of the Kelkar Committee must be understood in that context. The Kelkar Committee, I believe, has presented the worst-case scenario. It is our duty to avoid the worst-case and do everything possible to contain the deficits. After carefully examining the feedback on the Kelkar Committee’s report, it is our intention to announce a credible and feasible path of fiscal correction beginning this year and ending with the 5th year of the 12th Plan.

Secondly, the need to contain inflation. A depreciating rupee will worsen inflation. We have no option but to import a number of goods and, in some cases, services. These include crude oil and petroleum products, fertilizers, coal, organic chemicals, transport equipment, machinery, iron & steel, edible oils and project goods. In 2011-12, the value of the top 20 essential and unavoidable imports was USD 438 billion. The value of the rupee is an important factor that affects the value of imports. A depreciating rupee will also impact trade and investments. Hence, the need to stabilise the exchange rate. I believe that we have met with moderate success. The rupee had touched a low of Rs.57.22 to one USD on June 27, 2012. On July 31, 2012, the exchange rate was Rs.55.80. A short while ago the exchange rate was Rs.52.13.

Thirdly, given our deficits and the depreciation of the rupee, the crucial role of foreign investment is self-evident. Hence the measures to promote capital inflows. In the hierarchy of inflows, remittances by Indians overseas and foreign direct investment (FDI) are preferable to debt creating inflows. Just as we encourage Indian investors to invest abroad, acquire businesses and assets in other countries, and explore new opportunities and markets, we must not fear foreign investments in India. We have the sovereign right to decide where and how foreign investments would be allowed into India. Each decision to allow foreign investment should therefore be tested not on the basis of some undefined ideology or theory, but on a clear-headed assessment of the advantages that will accrue to India. I have no doubt in my mind that recent decisions to allow FDI in retail, aviation and FM radio broadcasting are decisions that will benefit the economy and the country.

Fourthly, the decision, in principle, to transfer subsidies directly to the beneficiaries in cash is a bold decision that has manifold advantages. For example, if wages under MGNREGA and scholarships to students are transferred to the bank accounts of the beneficiaries using the Aadhar, there will be no case of duplication or falsification. Nor will there be any leakage to, or rent-seeking by, intermediaries. It is our intention to take measured steps in this direction so that subsidies are transferred to the beneficiaries directly, quickly and efficiently. I also visualise huge savings in the subsidies bill.

I could explain the Government’s point of view on some other issues and some other decisions that were taken recently, but I shall leave those for the interactive session.

Let me conclude by asking for your understanding and support. I had underlined your vital role in communicating to the people. I believe that the India growth story is sound and the reform momentum will remain strong and unabated. We should shed self-doubt. We should banish irrational fears. We should embrace the future with confidence. We should believe that we have the capacity to overcome any crisis, as we did in 1991, 1997, and 2008. We have a good story to tell the people of India and the rest of the world and I ask your support in communicating that story.”

Oilmeal exports down in April-September as soya meal turns dearer

2012-10-07T16:20:00.000+05:30

The Solvent Extractors’ Association of India has just compiled the export data for export of oil meals for the month of September 2012. The export of oil meals during September 2012 is reported at 143,990 tonnes compared to 402,500 tonnes in September 2011 i.e. down by 64%. The total export of oil meals during April to September 2012 has reduced and reported at 1,603,065 tonnes compared to 2,096,801 tonnes during the same period of last year i.e. down by 24%. High price of soybean seed resulted into lesser crushing and availability of soybean meal for local as well as for the export. Lack of buying by Iran and disparity in export of soybean meal due to high price in local market resulted into steep fall in its exports. The slump was largely due to a 97 per cent drop in soya meal shipments and a 63 per cent decline in castor seed extracts.

Edible oil extractors had cut down production due to high soya bean prices. This has resulted in lower soya bean meal availability and pushed up prices in the domestic markets. With higher realization in domestic markets, there was very little interest on exports of soya meal extracts. However, the export of rice bran extracts increased by 48 per cent in September to 23,400 tonnes.

Lack of buying interest by traders in Iran and other countries also pulled down exports in September, said a press release issued on Friday by Solvent Extractors’ Association of India.Interestingly, Iran has emerged as the largest buyer of Indian soya meal extracts in the first six months of the current fiscal accounting for more than half of Indian exports. Iran imported 4.4 lakh tonnes of the total soya meal exports of 8.22 lakh tonnes in the April-September period. The recent bilateral payment mechanism that allows importers in Iran to make payments in Indian rupees has aided the soya meal shipments.

For the April-September period, Iran imported a total of 4.57 lakh tonnes of Indian oil meals compared to 1.5 lakh tonnes in the corresponding period last year. The drop in export demand pulled down soya meal prices to $668 a tonnes in September against $760 realized in August.

Rapeseed meal was also quoted lower at $325 a tonnes against $343 a tonnes in August. The appreciation in value of rupee against dollar to Rs 54.35 in September against Rs 55.49 in August also discouraged exports.

Demand from South Korea was down seven per cent at 63,734 tonnes (68,540 tonnes) in September. However, South Korea has replaced Japan as the largest buyer of Indian oil meal extracts in the first half of the current fiscal. South Korea imported a total of 4.59 lakh tonnes of oil meal extracts against 3.38 lakh tonnes in the corresponding period last year.

Japan, which had imported close to five lakh tonnes of Indian oil meals in first half of 2011-12, bought only 85,181 tonnes so far this year.

Rajesh Agarwal, spokesperson for Soya bean Processors Association of India, attributed the slump in exports to high prices. Buyers had preferred to wait-and-watch the prices mainly due to the concern over output in the US, he said.

During September, Thailand more than halved its imports to 17,330 tonnes from 36,032 tonnes, while that of Indonesia fell 75 per cent to 2,580 tonnes from 10,228 tonnes. Vietnam was the only country which increased its order to 40,100 tonnes from 27,924 tonnes.

Rice exports from India to be record 10 MT in 2011-12 year: USDA

2012-10-07T08:58:00.000+05:30

According to the US Department of Agriculture (USDA), rice exports estimated for India are revised upward by two million tonnes to a record 10 million tonnes in the 2011-12 marketing year (October-September) after taking into account the official trade reports.

India re-entered the rice exports market in September 2011 after a four-year ban on exports of non-basmati rice.

It said that the country is estimated to have shipped 8.2 million tonnes of rice in the first nine months of the 2011-12 marketing year. Of which, 5.5 million tonnes was non-basmati rice and 2.7 million tonnes basmati rice.

“Assuming some spill-over of export shipments lying at Kakinada to October, rice exports during July-September are likely to exceed 1.8 million tons, which will take rice exports in 2011-12 to a record 10 million tonnes,” it added.

Quoting trade sources report, the USDA said that export of basmati and non-basmati rice have been steady during the months of July through September on strong export demand and relatively stable Indian rupee vis-is US dollars.

That apart, the USDA said, “Indian non-basmati rice for export remains very price competitive, with Indian common rice varieties ranging from $375—450 per tonne on freight on board (FOB) in the fourth week of September.”

The “unexpectedly” strong export demand for rice has resulted in port congestion at Kakinada in the east coast with reports of about 6,00,000 tonnes of rice currently lying in the port for export shipment, it noted.

Lower rainfall in July-August, particularly in coastal Gujarat and Andhra Pradesh, has also facilitated movement of rice for export, it added.

The report also said that the government is likely to continue with the current rice export policy due to surplus domestic supplies and abnormally large government foodgrain stocks.

The government rice stocks stood at 25.59 million tonnes as on September 1, nearly 2.9 million tonnes higher than the last year’s level.

India, the world’s largest rice grower, had produced a record 104.32 million tonnes of rice last year due to good monsoon.

Pulses and edible oils production may fall this year

2012-10-07T08:50:00.000+05:30

Though rice, wheat and sugar production is expected to be at comfortable levels, production of pulses and edible oils may fall short of requirement this year, said K.V. Thomas, Union Minister of State for Consumer Affairs, Food and Public Distribution.

Talking to a group of journalists after inaugurating the Centenary Building of National Test House (Southern Region) yesterday, he said according to the assessment of the Meteorology Department and the Ministry of Agriculture, this year production of rice and wheat will be as good as last year.

Last year, production of paddy was to the tune of about 103 million tonnes and wheat was to the tune of 94 mt. More or less, the same quantity of rice and wheat is expected this year as well.

He said his department has discussed with various State Government officials for the procurement of rice and wheat. All arrangements have been made, including jute bags.

His Ministry has called for a meeting of the Food and Public Distribution Ministry officials of all states on October 29 and 30 in Delhi. All other procurement details will be worked out that time.

On storage capacities, he said five years ago there was a capacity to store 55 mt of foodgrains. Now, it has been expanded to 75 mt. By the end of this year, another 45 lakh tonne capacity will be added.

About 151 lakh tonnes of new capacity will be added by the end of 2013. Besides, two million tonnes of silos will also be constructed. “Hence, I don’t see any problem as far as the storage issue is concerned.”

Regarding sugar, he said last year the production was projected at 240 lakh tonnes. However, finally it ended up with 262 lakh tonnes, while the domestic need was only 220 lakh tonnes.

This year, the projection is at 230 lakh tonnes, which is quite sufficient. “We think, even this year, sugar production will surpass the projection and go up to 240-245 lakh tonnes,” he said.

But, he said his Ministry is “slightly worried” about the pulses and edible oils situation. Chances are that the production of pulses and edible oil come down this year. Even internationally, availability is slightly low.

With this in mind, he said, the Government has decided to continue with the supply of pulses and edible oils at subsidised price. This year, the subsidy on pulses will be Rs 20 a kg and on edible oils Rs 15 a litre. States are also allowed to import pulses and edible oil for distribution and it will be subsidised by the Central Government, he said.

Besides, the Central Government has decided to computerise the Public Distribution System end-to-end — from the Food Corporation of India godowns to state-run ration shops, every movement will be computerised. It is a 50:50 project, funded by the Central and respective State Governments.

Earlier there were 20 crore ration cards in the country. After the computerisation process began in some states, two crore cards were found to be bogus and eliminated from the system, he said. “PDS system has to be modernised. All the loopholes are to be plugged to strengthen the system, and make it more efficient,” he said.

Talking about the Food Security Bill, he said the Bill is being considered by the Parliament Standing Committee, and is likely to be passed. And, the Standing Committee is expected to submit its opinion in a month. “The Bill may be passed in the coming Winter Session,” he said.

Answering a question on wheat exports to Iran, he said the exports are going on under Open General Licence scheme. The central pool has 80.5 mt of wheat, while what is required for public distribution is only 55 mt. So, exports will continue till the need to stop it arises.

On food subsidy bill and whether the government plans any cut, he said the government is bound to give food items on subsidised rates. At present, he said, food subsidy alone accounts for Rs 88,000 crore, and it will continue. “There is nothing to be worried,” he said.

Official amendments to the Forward Contracts (Regulation) Amendment Bill, 2010

2012-10-06T08:37:00.000+05:30

The Union Cabinet has approved the proposal to move official amendments to the Forwards Contracts (Regulation) Amendment Bill, 2010 (the Bill, 2010), based upon the recommendations of the Parliamentary Standing Committee of the Ministry of Consumer Affairs, Food & Public Distribution in its 15th Report, in the next session of Parliament.

After the Bill is passed and enacted by Parliament, Forward Market Commission (FMC) as a regulator will get autonomy and power to regulate the market effectively. New products like `options` will be allowed in the commodity market. This will benefit various stakeholders including farmers to take benefit of `price discovery and `price risk management`. The Bill would enhance public accountability of the Regulator by providing for an Appellate Authority.

The recommendations of the Committee with regard to definition of the "Commodity Derivative" in Clause 3, establishment and constitution of Forward Markets Commission in Clause 4, term of office of the Chairman and every other whole time members in Clause 5, accounts and audit in Clause 9, penalties for contravention of certain provisions of Chapter IV in Clause 25 of the Bill, 2010 have been accepted and are proposed to be incorporated as official amendments. The amendment in Clause 25 will require consequential amendment in Clause 26, which is also proposed to be included in the official amendments.

Background:

The Forward Contracts (Regulation) Act provides for the regulation of commodity futures markets in India and the establishment of the Forward Markets Commission (FMC). While the markets have been liberalized with effect from April, 2003 and modern institutional structures are in the process of being evolved, yet the market regulator, FMC is largely functioning in its traditional format.

Many of the existing provisions of the Forward Contracts (Regulation) Act need changes to strengthen and reinforce legal provisions to meet the requirements of changing environment. In order to amend further the Forward Contracts(Regulation) Act, the Bill, 2010 was introduced in the Lok Sabha on 6.12.2010. The Bill, 2010 went through examination by the Committee which submitted its 15th Report on 22nd December, 2011.

Indian Rice Exports Eased Global Prices

2012-10-02T16:53:00.003+05:30

Agriculture Minister, Shri Sharad Pawar yesterday sought to highlight India’s role in stabilising global food supplies and moderating price rise.

The Minister was addressing the meeting of the ‘High Level Regional Consultation on Policies to Respond to High Food Prices in Asia and the Pacific Region’ organized by FAO at Bangkok.

From an importing nation India has now become a nation that exports wheat and rice, the Agriculture Minister said. “I am glad to inform that our efforts are showing excellent outcomes. From having to import about 6.5 million tonne of wheat in 2006 and 2007 we are now not only meeting the domestic demand but have also begun contributing to global supply through exports. Similarly, in case of rice, we faced problems in 2009 as our buffer stocks kept for supplies under public distribution system had dipped due to inadequate production. In the past twelve months, however, due to record production over the years, we have already exported about 8 million tonne of rice. The exports from India has not only stabilized the global supplies but have helped in easing the ruling high prices to affordable levels.”

Stating that increasing agricultural production and diversifying the production base has become the need of the hour, he said, “India has been following since 2007 the strategy of agricultural development by widening the production base and focusing attention to high potential low producing areas through intensive promotion of technologies in order to bridge the yield gaps.”

Laying stress on the global food economy in domestic context he went on to state “In order to better understand the global food economy in domestic context we in India have initiated a study project on developing Agricultural Outlook where situation analysis and forecasts are prepared periodically for the short and the medium terms. We are grateful to FAO for supporting this initiative with technical assistance on international exposure and capacity building. We believe that informed decisions based on sound analysis help develop better understanding of food situation internationally and locally.”

Informing the various international organizations and policy experts gathered at the consultation meeting he informed: “India is actively involved in the evolution of these mechanisms, for shaping the information system for a sound real time analysis of the developing situation on supply, stocks, trade, demand and prices of food grains in different parts of the world. We believe that credible information generated by the system would be a valuable input for any policy initiative at the country level should any of the supply, price or trade shocks cause disruption in food availability. Better information is the key to being better prepared.”

He further said, “South Asian Countries have started a SAARC Food Bank to service the needs of the member countries in case of any supply shock as a result of calamities or otherwise. There is need to strengthen such regional cooperation instruments to respond to the developing global food crisis. It is our collective responsibility to reach out to those vulnerable populations whose access to food is compromised due to high food prices.”

CACP favours MSP hike for rabi pulses, oilseeds

2012-09-30T17:46:00.001+05:30

The Commission for Agricultural Costs and Prices (CACP) has recommended to the Government a hike in minimum support price for winter-sown pulses and oilseeds by up to Rs 500 a quintal.

The Agriculture Ministry will move a Cabinet note on this after seeking comments from the ministries concerned and the state governments.

A senior government official said the CACP has not recommended raising the minimum support price (MSP) of wheat and barley for the 2013-14 rabi marketing season (April-March) in view of excess supply in the country following record production last year.

It suggested keeping the MSP of wheat and barley unchanged at Rs 1,285 per quintal and Rs 980 per quintal, respectively.

The Commission has recommended no increase in wheat MSP because the wholesale prices of the grain are currently ruling below support price at Rs 1,160 per quintal.

But the production cost was around Rs 1,066 per quintal in 2012-13. A similar trend was seen in barley, the official said.

“However, the CACP has suggested the Government to announce 10 per cent bonus to wheat and barley farmers if exports are banned next year,” the official said.

To boost the production of pulses and oilseeds, the CACP has proposed increase in the MSP of gram by Rs 200 to Rs 3,000 a quintal and masur dal by Rs 100 to Rs 2,900 a quintal for 2012-13 rabi season.

Similarly for oilseeds, the Commission has recommended increase in the support price of mustard seed by Rs 500 to Rs 3,000 a quintal and safflower by Rs 300 to Rs 2,800 per quintal.

The reasons given were that the cost of production of pulses and oilseeds has increased substantially over the last few years and the increase in support price will encourage farmers to grow these crops, the official said.

While sowing in rabi (winter) season starts from October, the harvesting of crops is undertaken during April-March.

The Government aims to achieve foodgrains production of 130 million tonnes during the 2012-13 rabi season. Of this, 86 mt would be wheat, 12.5 mt of pulses, and 15 mt of rice.
Source: Hindubusinessline

117.18 MT Food grain Production Estimated in the Kharif Season

2012-09-24T21:31:00.000+05:30

As per the First Advance Estimates of production of Kharif crops, 117.18 million tonnes (MT) food grains is likely to be produced in the current season.

These production estimates are higher than the average of the first advance estimates of the last five years (113 MT). Final estimates are generally 5 to 10% higher than the first estimates. Even as compared to the average of final estimates (118.86 MT), the current estimates are lower by 1.68 million tonnes or about 1.4% despite deficient and late rains this year.

These estimates were released by Agriculture Minister, Sharad Pawar today. Speaking on the occasion, the Minister said, the estimates were higher than expectations considering the truant monsoon rains.

The assessment of production of different crops is based on the feedback received from States and validated with information available from other sources.

The estimated production of major crops during Kharif 2012-13 is as under:

Food grains ‒ 117.18 million tonnes
Rice ‒ 85.59 million tonnes
Coarse Cereals ‒ 26.33 million tonnes
Maize ‒ 14.89 million tonnes
Pulses ‒ 5.26 million tonnes
Tur ‒ 2.78 million tonnes
Urad ‒ 1.14 million tonnes
Oilseeds ‒ 18.78 million tonnes
Soyabean ‒ 12.62 million tonnes
Groundnut ‒ 3.82 million tonnes
Castorseed ‒ 1.40 million tonnes
Cotton ‒ 33.40 million bales (of 170 kg each)
Sugarcane ‒ 335.33 million tonnes

As per 1st advance estimates, production of Rice estimated at 85.59 million tonnes, though lower as compared to last year’s record Kharif production, is higher than the average production of 83.17 million tonnes.

The estimated production of Coarse Cereals, is however, lower than average production by 3.65 million tonnes mainly on account of loss in area coverage under Bajra and Maize in the States of Gujarat, Haryana, Maharashtra, Karnataka and Rajasthan.

The estimated production of Kharif Pulses is also lower than the average production by 0.45 million tonnes mainly due to shortfall in Moong and other Kharif Pulses.

Though there is a significant increase in estimated production of soya bean, yet due to decline in the production of Groundnut, total production of Kharif Oilseeds estimated at 18.78 million tonnes is lower than the average production by 0.61 million tonnes.

The current year’s production of Sugarcane estimated at 335.33 million tonnes is higher by 10.22 million tonnes as compared to average production.

The estimated production of Cotton at 33.40 million bales (of 170 kg each) has registered an increase of 5.32 million bales as compared to average cotton production of 28.08 million bales. Production of Jute is also estimated to be marginally higher than the average production.

Prime Minister's Address to the Nation

2012-09-23T15:21:00.000+05:30

Prime Minister, Dr. Manmohan Singh addressed the nation on Friday, 21 September 2012. Following is the text of the Prime Minister’s address:

“My dear brothers and sisters,

I am speaking to you tonight to explain the reasons for some important economic policy decisions the government has recently taken. Some political parties have opposed them. You have a right to know the truth about why we have taken these decisions.

No government likes to impose burdens on the common man. Our Government has been voted to office twice to protect the interests of the aam admi.

At the same time, it is the responsibility of the government to defend the national interest, and protect the long term future of our people. This means that we must ensure that the economy grows rapidly, and that this generates enough productive jobs for the youth of our country. Rapid growth is also necessary to raise the revenues we need to finance our programmes in education, health care, housing and rural employment.

The challenge is that we have to do this at a time when the world economy is experiencing great difficulty. The United States and Europe are struggling to deal with an economic slowdown and financial crisis. Even China is slowing down.

We too have been affected, though I believe we have been able to limit the effect of the global crisis.

We are at a point where we can reverse the slowdown in our growth. We need a revival in investor confidence domestically and globally. The decisions we have taken recently are necessary for this purpose.

Let me begin with the rise in diesel prices and the cap on LPG cylinders.

We import almost 80% of our oil, and oil prices in the world market have increased sharply in the past four years. We did not pass on most of this price rise to you, so that we could protect you from hardship to the maximum extent possible.

As a result, the subsidy on petroleum products has grown enormously. It was Rs. 1 lakh 40 thousand crores last year. If we had not acted, it would have been over Rs. 200,000 crores this year.

Where would the money for this have come from? Money does not grow on trees. If we had not acted, it would have meant a higher fiscal deficit, that is, an unsustainable increase in government expenditure vis-a-vis government income. If unchecked, this would lead to a further steep rise in prices and a loss of confidence in our economy. The prices of essential commodities would rise faster. Both domestic as well as foreign investors would be reluctant to invest in our economy. Interest rates would rise. Our companies would not be able to borrow abroad. Unemployment would increase.

The last time we faced this problem was in 1991. Nobody was willing to lend us even small amounts of money then. We came out of that crisis by taking strong, resolute steps. You can see the positive results of those steps. We are not in that situation today, but we must act before people lose confidence in our economy.

I know what happened in 1991 and I would be failing in my duty as Prime Minister of this great country if I did not take strong preventive action.

The world is not kind to those who do not tackle their own problems. Many European countries are in this position today. They cannot pay their bills and are looking to others for help. They are having to cut wages or pensions to satisfy potential lenders.

I am determined to see that India will not be pushed into that situation. But I can succeed only if I can persuade you to understand why we had to act.

We raised the price of diesel by just Rs. 5 per litre instead of the Rs 17 that was needed to cut all losses on diesel. Much of diesel is used by big cars and SUVs owned by the rich and by factories and businesses. Should government run large fiscal deficits to subsidise them?

We reduced taxes on petrol by Rs. 5 per litre to prevent a rise in petrol prices. We did this so that the crores of middle class people who drive scooters and motorcycles are not hit further.

On LPG, we put a cap of 6 subsidised cylinders per year. Almost half of our people, who need our help the most, actually use only 6 cylinders or less. We have ensured they are not affected. Others will still get 6 subsidised cylinders, but they must pay a higher price for more.

We did not touch the price of kerosene which is consumed by the poor.

My Dear Brothers and Sisters,

You should know that even after the price increase, the prices of diesel and LPG in India are lower than those in Bangladesh, Nepal, Sri Lanka and Pakistan.

The total subsidy on petroleum products will still be Rs. 160 thousand crores. This is more than what we spend on Health and Education together. We held back from raising prices further because I hoped that oil prices would decline.

Let me now turn to the decision to allow foreign investment in retail trade. Some think it will hurt small traders. This is not true.

Organised, modern retailing is already present in our country and is growing. All our major cities have large retail chains. Our national capital, Delhi, has many new shopping centres. But it has also seen a three-fold increase in small shops in recent years.

In a growing economy, there is enough space for big and small to grow. The fear that small retailers will be wiped out is completely baseless.

We should also remember that the opening of organised retail to foreign investment will benefit our farmers. According to the regulations we have introduced, those who bring FDI have to invest 50% of their money in building new warehouses, cold-storages, and modern transport systems. This will help to ensure that a third of our fruits and vegetables, which at present are wasted because of storage and transit losses, actually reach the consumer. Wastage will go down; prices paid to farmers will go up; and prices paid by consumers will go down.

The growth of organised retail trade will also create millions of good quality new jobs.

We recognise that some political parties are opposed to this step. That is why State governments have been allowed to decide whether foreign investment in retail can come into their state. But one state should not stop another state from seeking a better life for its farmers, for its youth and for its consumers.

In 1991, when we opened India to foreign investment in manufacturing, many were worried. But today, Indian companies are competing effectively both at home and abroad, and they are investing around the world. More importantly, foreign companies are creating jobs for our youth -- in Information Technology, in steel, and in the auto industry. I am sure this will happen in retail trade as well.

My Dear Brothers and Sisters,

The UPA Government is the government of the aam aadmi.

In the past 8 years our economy has grown at a record annual rate of 8.2 per cent. We have ensured that poverty has declined much faster, agriculture has grown faster, and rural consumption per person has also grown faster.

We need to do more, and we will do more. But to achieve inclusiveness we need more growth. And we must avoid high fiscal deficits which cause a loss of confidence in our economy.

I promise you that I will do what everything necessary to put our country back on the path of high and inclusive growth. But I need your support. Please do not be misled by those who want to confuse you by spreading fear and false information. The same tactics were adopted in 1991. They did not succeed then. They will not succeed now. I have full faith in the wisdom of the people of India.

We have much to do to protect the interests of our nation, and we must do it now. At times, we need to say "No" to the easy option and say "Yes" to the more difficult one. This happens to be one such occasion. The time has come for hard decisions. For this I need your trust, your understanding, and your cooperation.

As Prime Minister of this great country, I ask each one of you to strengthen my hands so that we can take our country forward and build a better and more prosperous future for ourselves and for the generations to come.

Jai Hind.”

Sugar output to surpass demand

2012-09-15T20:21:00.000+05:30

The country’s sugar production is set to exceed domestic consumption for the third consecutive year in 2012-13 season starting October. This is despite a lower crop in Maharashtra and Karnataka, where dry spells triggered by poor rain in early part of the monsoon, hurt the standing cane crop.

The loss in these two States, which contributed to around 45 per cent of the country’s total output, is largely made up by Uttar Pradesh, where farmers – buoyed by higher returns last year – have planted cane on an additional area of 2.2 lakh hectares.

Moreover, the sharp decline in cane arrears has aided the trend. The overall cane acreage is higher by 4.5 per cent at 52.88 lakh hectares than last year’s 50.63 lakh hectares. Though the rains have recovered in late August, the damage triggered by dry spells is unlikely to be neutralized.

Despite a decline in output, the industry expects the surplus for exports to be around 1.5 million tonnes against 4 million tonnes last year. The higher surplus coupled with rise in output kept Indian exporters active in the global markets, with shipments touching about 3.5 million during 2011-12 season.

The opening balance at the beginning of 2012-13 season is pegged at 6 million tonnes, marginally lower than last year’s 5.5 million tonnes. The third successive year, where production has been higher than consumption, points towards a stabilizing trend in the sugar industry.

The bullish trend in sugar prices, which the millers are comfortable with should possibly help them break the cycle. The uncertainty in Maharashtra crop sparked a rally in prices, which are now in the Rs 33-35 a kg at the ex-factory level, against Rs 28-29 the previous year. The prices are expected to remain firm going forward on strong demand, which is growing over 2.2 per cent annually.

The consumption in 2011-12 is estimated at 22 million tonnes. The firm trend should augur well for millers helping them pare their losses. In Maharashtra, the output according to ISMA’s estimates is at 6.5 million tonnes, down from 8.95 million tonnes last year.

The dry spells did force the farmers to divert cane to fodder and ISMA estimates that up to 3.5 million tonnes cane was diverted to fodder since May. The cane area reported by the State stood at 9.04 lakh hectares in August (10.25 lakh hectares).

In Karnataka, ISMA estimates a 21 per cent decline in output at 3 million tonnes (3.8 million tonnes). The cane area in the State has dropped by 2 per cent and the sugar recovery will be hit as scanty rain has affected the crop.
However, production in Uttar Pradesh is expected to be 13.27 per cent higher at 7.9 million tonnes on good rains helping yields and recovery.

UP produced 6.97 lakh tonnes of the sweetener last year. Meanwhile, in Andhra Pradesh, sugarcane area will be 10-20 per cent lower than the normal area of 2 lakh hectares. Multiple factors have led to this situation.

While farmers in some areas shifted to maize and soya, those in the delta area feel that the cane coverage could be 75 per cent of the normal area.
Source: Hindu Business line

Index Numbers of wholesale Prices in India (Base: 2004-05=100) Review for the Month of August, 2012

2012-09-14T21:25:00.000+05:30

The official Wholesale Price Index for ‘All Commodities’ (Base: 2004-05 = 100) for the month August, 2012 rose by 1.1 percent to 166.6 (Provisional) from 164.8 (Provisional) for the previous month.

INFLATION

The annual rate of inflation, based on monthly WPI, stood at 7.55% (Provisional) for the month of August, 2012 (over August, 2011) as compared to 6.87% (Provisional) for the previous month and 9.78% during the corresponding month of the previous year. Build up inflation in the financial year so far was 3.48% compared to a build up of 3.61% in the corresponding period of the previous year.

The movement of the index for the various commodity groups is summarized below:-

PRIMARY ARTICLES (Weight 20.12%)

The index for this major group rose by 0.3 percent to 219.5 (Provisional) from 218.8 (Provisional) for the previous month. The groups and items for which the index showed variations during the month are as follows:-

The index for `Food Articles` group declined by 0.4 percent to 211.4 (Provisional) from 212.2 (Provisional) for the previous month due to lower prices of fruits & vegetables (5%), poultry chicken (4%), fish-marine (2%) and milk (1%). However, the prices of arhar (8%), ragi(7%), gram and urad (6% each), moong, coffee and wheat (5% each), bajra, condiments & spices and masur (4% each), egg, tea and fish-inland (3% each), jowar, maize and rice (2 % each) and mutton and barley (1% each) moved up.

The index for `Non-Food Articles` group rose by 3.8 percent to 206.8 (Provisional) from 199.2 (Provisional) for the previous month due to higher prices of castor seed (15%), raw silk (14%), gingelly seed (12%), coir fibre (11%), rape & mustard seed (9%), cotton seed and linseed (7% each), niger seed and flowers (6%), soyabean (5%), fodder, groundnut seed and sugarcane (4% each), guar seed, logs & timber and raw cotton (3% each), raw jute (2%) and sunflower (1%). However, the prices of raw rubber (6%), copra (coconut) and mesta (2% each) declined.

The index for `Minerals` group declined by 1.3 percent to 331.3 (Provisional) from 335.8 (Provisional) for the previous month due to lower prices of sillimanite (13%), copper ore (9%), magnesite (7%), zinc concentrate and crude petroleum (3% each), steatite (2%) andchromite (1%). However, the prices of phosphorite (23%), iron ore (4 %) and barytes (1%) moved up.

FUEL & POWER (Weight 14.91%)

The index for this major group rose by 3.1 percent to 181.0 (Provisional) from 175.5 (Provisional) for the previous month due to higher prices of electricity (agricultural) (23%), electricity (industry) (11%), electricity (domestic) (9 %), electricity (railway traction) (8%), light diesel oil (7%), electricity (commercial) and naphtha (6%each), aviation turbine fuel (5%), furnace oil (4%), kerosene (2%) and petrol (1%).

MANUFACTURED PRODUCTS (Weight 64.97%)

The index for this major group rose by 0.8 percent to 146.9 (Provisional) from 145.7 (Provisional) for the previous month. The groups and items for which the index showed variations during the month are as follows:-

The index for `Food Products` group rose by 3.0 percent to 164.5 (Provisional) from 159.7 (Provisional) for the previous month due to higher prices of sugar (8%), oil cakes and gur (6% each), gram powder (besan), sooji (rawa) and gingelly oil (5% each), wheat flour (atta),khandsari and cotton seed oil (4% each), tea dust (unblended) and maida (3% each), mustard & rapeseed oil, vanaspati and mixed spices (2% each) and gola (cattle feed), groundnut oil, soyabean oil, bakery products, processed prawn and ghee (1% each). However, the prices of tea leaf (unblended) (1%) declined.

The index for `Textiles` group rose by 0.2 percent to 130.4 (Provisional) from 130.1 (Provisional) for the previous month due to higher prices of man-made fibre, jute yarn and cotton fabric (1% each).

The index for `Wood & Wood Products` group rose by 0.3 percent to 169.6 (Provisional) from 169.1 (Provisional) for the previous month due to higher prices of processed wood (1%).

The index for `Paper & Paper Products` group rose by 0.5 percent to 135.2 (Provisional) from 134.5 (Provisional) for the previous month due to higher prices of paper cartons / boxes (6%), newspaper (2%) and paper rolls (1%). However, the prices of computer stationery (2%) and newsprint (1%) declined.

The index for `Leather & Leather Products` group rose by 0.4 percent to 134.2 (Provisional) from 133.7 (Provisional) for the previous month due to higher prices of leathers (1%).

The index for `Rubber & Plastic Products` group rose by 0.7 percent to 136.9 (Provisional) from 135.9 (Provisional) for the previous month due to higher prices of plastic products and rubber products (1% each).

The index for `Chemicals & Chemical Products` group rose by 0.6 percent to 143.2 (Provisional) from 142.3 (Provisional) for the previous month due to higher prices of di ammonium phosphate (3%), pigment & pigment intermediates and organic manure (2% each) and synthetic resin, paints, non-cyclic compound, basic organic chemicals, adhesive & gum, ammonium sulphate, basic inorganic chemicals, safety matches/ match box and antibiotics (1% each). However, the prices of rubber chemicals and distemper (2% each) and polymers (1%) declined.

The index for `Non-Metallic Mineral Products` group rose by 1.1 percent to 164.2 (Provisional) from 162.4 (Provisional) for the previous month due to higher prices of railway sleeper (3%), grey cement (2%) and white cement and polished granite (1% each). However, the prices of glass bottles & bottleware (1%) declined.

The index for `Basic Metals, Alloys & Metal Products` group rose by 0.1 percent to 166.6 (Provisional) from 166.4 (Provisional) for the previous month due to higher prices of gold & gold ornaments (3%), ferro chrome (2%) and nuts/bolts/screw/ washers, steel: pipes & tubes, ferro manganese, zinc and aluminium (1% each). However, the prices of sponge iron (3%), pencil ingots (2%) and wire rods, melting scrap, gp/gc sheets, pig iron, copper products (other than wire) and rounds (1% each) declined.

The index for `Machinery & Machine Tools` group rose by 0.2 percent to 128.1 (Provisional) from 127.9 (Provisional) for the previous month due to higher prices of conductor (6%), lamps, fans and material handling equipments (3% each), harvester, ups / stabilizer, fibre optic cable and electric switches (2% each) and insulators, electrical wires, electric switch gears, air conditioner & refrigerators, capacitors, thresher and plastic machinery (1 % each).

The index for `Transport, Equipment & Parts` group rose by 0.6 percent to 129.3 (Provisional) from 128.5 (Provisional) for the previous month due to higher prices of auto rickshaw / tempo / matador (3%), tractors (2%) and parts of ships/boats etc., bus / mini bus / truck and motor cycle / scooter / moped (1% each).

FINAL INDEX FOR THE MONTH OF JUNE , 2012 (BASE YEAR: 2004-05=100)

For the month of June, 2012, the final Wholesale Price Index for ‘All Commodities’ (Base: 2004-05=100) stood at 164.7as comparedto 164.2 (provisional) and annual rate of inflation based on final index stood at 7.58 percent as compared to 7.25 percent respectively as reported on 16.07.2012.

Livestock Census of 15 species to be completed in 30 days

2012-09-14T21:16:00.000+05:30

Livestock Census is conducted all over the country through Department of Animal Husbandry of respective States/Union Territories from 15.09.2012 to 15.10.2012 with reference date as 15.10.2012 except in Jammu & Kashmir and Sikkim, wherein the reference dates are 30th October 2012 and 30th November 2012 respectively. The 15 species of livestock and poultry birds of this country will be completely enumerated during the period. Suitable statistical methods are adopted to report the livestock and poultry of the country on the date of reference. Livestock census will help in formulating policies for requisite infrastructure in States/UTs for improving productivity of livestock sector; promoting infrastructure for handling, processing and marketing milk and milk products; preservation and protection of livestock through provision of health care; and strengthening of efforts for development of superior germplasm for distribution.

About 2 lakhs personnel will be involved in actual data collection. Urgent measures are being taken up by all States/Union Territories to start enumeration work in time. Department of Animal Husbandry, Dairying & Fisheries, Ministry of Agriculture, and Government of India is providing uniform methodology and necessary financial assistance to all States/Union Territories to conduct livestock census.

Diesel Price Increased by Rs 5 per litre; Subsidized Domestic LPG Cylinders restricted to 6 in a year

2012-09-14T21:10:00.000+05:30

The Cabinet Committee on Political Affairs (CCPA) under the chairmanship of the Prime Minister to consider the disturbing situation arising out of projected massive under-recoveries of Rs. 1,87,127 crore for the financial year 2012-13 in the wake of high international crude oil prices and sharp depreciation of Indian rupee against US dollar took the following decisions to be implemented with effect from the midnight of 13/14 September 2012 :

a) Increase in price of diesel by Rs. 5 per litre excluding VAT. Out of this, Rs. 1.50 per litre is on account of increase in Excise Duty. The balance increase of Rs. 3.50 per litre will reduce the under-recovery of OMCs by about Rs. 15,000 crore for the remaining part of the current financial year. The under-recovery on sale of diesel during 2012-13, even after this price hike, is estimated to be above Rs. 1,03,000 crore. The revised RSP of diesel in Delhi will be approximately Rs 47 per litre. Further, branded diesel will be sold at the market rate.

b) No increase in the price of petrol, although the current under-recovery on petrol is about Rs 6 per litre. The consequent loss to the OMCs will be offset through reduction in excise duty on petrol by Rs 5.30 per litre.

c) Restrict the supply of subsidized LPG cylinders to each consumer to 6cylinders (of 14.2 Kg) per annum. This will help in reducing the under-recovery by about Rs. 5,300 crore for the remaining part of the financial year. The under-recovery on sale of Domestic LPG during 2012-13, even after this measure, is estimated to be above Rs. 32,000 crore. Any number of cylinders will be available over and above the cap of 6 cylinders at market rate. The number of subsidized LPG cylinders available to each consumer in the remaining part of the current financial year will be 3 cylinders. While subsidized cylinders will continue to be available at Rs. 399 per cylinder (at Delhi), the market rate of LPG cylinders at non subsidized rates will be notified by the OMCs on monthly basis.

d) No increase in the price of PDS Kerosene which is currently Rs. 14.83 per litre (at Delhi). The under-recovery of the OMCs on sale of Kerosene during 2012-13 will continue to be about Rs.32,000 crore.

It may be recalled that the Department Related Parliamentary Standing Committee on Petroleum & Natural Gas (which has members from all Political Parties) made recommendation on capping of subsidized LPG cylinders to 6 per annum.

The effect of capping supply of subsidized LPG cylinders at six per annum will lead to saving of subsidy on one third of the total LPG cylinders. Two third of the total cylinders will still be supplied at subsidized rate. About 44% of the total Domestic LPG consumers, who consume 6 cylinders or less per annum, will not be affected by this decision. Capping of cylinders will also lead to reduction in misuse/diversion of subsidized cylinders.

The above decisions will reduce the under-recovery of OMCs by about Rs. 20,300 crore and the under-recovery for 2012-13 will be about Rs. 1,67,000 crore which is more than the under-recovery of Rs. 1,38,541 crore incurred by OMCs during 2011-12.