Government looks to rein in dal prices through imports, buffer stock

New Delhi: With prices of pulses soaring to as high as Rs 170 per kg, the government on June 15 decided to import lentils from Myanmar and Africa and beef up the buffer stocks to check the spike in rates.

At a high-level meeting, Finance Minister Arun Jaitley discussed ways to control prices with Agriculture Minister Radha Mohan Singh, Food Minister Ram Vilas Paswan, Transport Minister Nitin Gadkari, Commerce Minister Nirmala Sitharaman and Urban Development Minister M Venkaiah Naidu.

The government is concerned about the prices of pulses ruling at a high of Rs 170 per kg and a spike in tomato prices to Rs 100 a kg. The reasons for the spike in prices and possible options available to check the same were discussed at the meeting.

Among the issues discussed were the releasing more pulses from the buffer stock whenever there is a demand from the states as well as importing pulses from Mayanmar and Africa to deal with the price rise.

"In the meeting, the pulses issue was discussed in detail. Our deparment was told to procure more pulses for buffer stock," Food Minister Ram Vilas Paswan said.

This year's target is to procure 1.5 lakh tonnes of pulses for buffer stock creation and so far, 1.15 lakh tonnes have been purchased during the kharif and rabi seasons, while the rabi procurement is still going on, he added. To boost domestic supply, Paswan said, "The Finance Minister also said that imports via public and private agencies should be strengthened to meet the deficit."

The government has decided to send a team immediately to pulses-growing nations like Myanmar and Africa to explore government-to-government imports, the Food Minister said. The meeting, which was also attended by secretaries to the department of economic affairs and revenue as well as Chief Economic Advisor, was informed that Kendriya Bhandar, Safal and other government agencies were selling the staple tur and urad dal at Rs 120 per kg from their outlets.

The government has already released 10,000 tonnes of pulses from buffer stock to deal with the situation. The govrenment's twin strategy comprises boosting supply through its newly-created buffer stock and imports. Already, India has submitted a draft agreement for import of tur from Myanmar on government-to-government route.

Many African countries have also envinced interest to supply lentils to India. Besides pulses, the price rise of tomato, sugar and wheat was also discussed at the meeting. Tomato prices have more than doubled to rule as high as Rs 100 per kg due to crop damage. Potato prices have also been on the rise.

Paswan informed in the meeting that the price rise in tomato was a "seasonal" factor and the commodity cannot be stored due to short shelf-life unlike wheat and rice. He also informed that his ministry is keeping a close watch on prices of pulses, sugar, wheat, tomato and other essential food items.

The country had imported 5.5 million tonnes of pulses last year. The country's pulses production is estimated to be 17.06 million tonnes in 2015-16 crop year (July-June), while the demand is pegged at 23.5 million tonnes. The ministers discussed the progress made in imports of pulses as well as reviewed the buffer stocks position and lifting by state governments for retail distribution at subsidised rates.

The government has procured 1.15 lakh tonnes pulses directly from farmers as of now for creating a buffer stock of 1.5 lakh tonnes this year. It is also importing pulses through state-owned trading agencies like MMTC.

So far, 38,500 tonnes of lentils have been contracted for import. The wholesale price inflation data released yesterday showed vegetable prices rising sharply to 12.94 per cent. Pulses inflation has remained in double digits since January 2015 and stood at 35.56 per cent in May.