Bringing Green Revolution to Eastern States of India

A presentation by

Surinder Singh, ED (Proc.), FCI Kolkata, July 26, 2012

The National Scene

Production & Procurement of Wheat at the National Level

The procurement as % of production has increased from 26% in 2002-03 to approx 42%

in 2012-13.3

Production & Procurement of Riceat the national Level

4

5

Regions RMS 2012-13 (25.07.12)

RMS 2011-12(25.07.11)

Quantitative Increase % increase

Punjab 128.34 109.57 18.77 17.13Haryana 86.65 68.82 17.83 25.91

U.P. 50.63 34.61 16.02 46.29M.P. 84.93 49.05 35.88 73.15

Rajasthan 19.64 13.03 6.61 50.71Gujarat 1.56 1.05 0.51 48.56

All India Total 381.14 280.75 100.39 35.76

Wheat Procurement in RMS 2012-13 & corresponding position in previous year

Figures in Lakh MT

During RMS 2012-13 (as on 25.07.12), the procurement of wheat has increased by almost 36% as compared to corresponding

period of last year.

6

RegionKMS 2011-12

(25.07.12)KMS 2010-11

(25.07.11) DifferenceAndhra Pradesh 74.33 87.86 -13.53Bihar 15.34 8.29 7.05Chhattisgarh 41.15 36.35 4.80Haryana 19.85 16.87 2.97Madhya Pradesh 6.38 4.03 2.35Odisha 28.16 24.26 3.90Punjab 77.31 86.35 -9.04Tamilnadu 15.96 14.02 1.94Uttar Pradesh 33.50 23.95 9.56West Bengal 17.64 10.03 7.61All India Total 345.68 322.96 22.72

Rice Procurement (including paddy in terms of rice) in KMS 2011-12 & corresponding position

in previous year

(Figures in Lakh MT)

We may end up procuring approx 360 LMTs of Rice, about 18 lakh tonnes more during KMS 2011-12, as compared to KMS 2010-11.

Marketing Year Chhattisgarh Orissa Tamil Nadu Bihar2002-03 12.91 8.87 - 1.582003-04 24.00 14.09 2.07 3.492004-05 28.37 15.86 6.52 3.422005-06 32.66 17.85 9.26 5.102006-07 28.65 20.02 10.77 4.762007-08 27.43 23.57 9.69 5.552008-09 28.48 28.01 12.01 10.832009-10 33.57 24.96 12.41 8.902010-11 37.46 24.65 15.43 8.832011-12

(As on 25.07.2012) 41.15 28.16 15.96 15.34

States where Rice Procurement has increased substantially in last 10 Years

(Figures in Lakh MTs)

7

Since KMS 2002-03, the procurement

in Chhattisgarh,

Orissa, Tamil Nadu &

Bihar have increased manifold

Marketing Year M.P Rajasthan Gujarat Bihar U.P.

2006-07 Neg. 0.02 -- -- 0.49

2007-08 0.57 3.83 -- 0.08 5.46

2008-09 24.1 9.35 4.15 5.00 31.38

2009-10 19.68 11.52 0.75 4.97 38.82

2010-11 35.38 4.76 0.01 1.83 16.45*

2011-12 49.65 13.03 1.05 5.56 34.612012-13

(as on 25.07.12) 84.93 19.64 1.56 7.38 50.63

States where Wheat Procurement has increased substantially in last 07 Years

(Figures in Lakh MTs)

8

Since RMS 2006-07, the procurement in M.P., Rajasthan,

Gujarat, Bihar & U.P. has increased manifold

* U.P. was in transition phase in RMS 2010-11 from DCP to Non-DCP mode.

Wheat Procurement during RMS 2012-13

Source Punjab Haryana Rajasthan M.P. U.P. Bihar All India Total

FCI 432 71 106 - 60 - 749 (4%)State Agencies 1338 300 212 2317 4570 8997 18336Total 1740 371 318 2317 4630 8997 19085

Source Punjab Haryana Rajasthan M.P. U.P. Bihar All India Total

FCI 19.35 (15%)

9.48(11%)

19.64(100%)

- 0.24(0.5%)

- 49.92(13%)

State Agencies 109.00 77.17 - 84.93 50.39 7.38 331.22Total 128.35 86.65 19.64 84.93 50.63 7.38 381.14

Procurement Centres Operated

Procurement of Wheat (In LMT, As on 25.07.12)

Paddy Procurement during KMS 2011-12

Source Punjab Chgs. Odisha Haryana U.P. Bihar A.P. W.B. All India Total

FCI 224 - 31 107 32 91 168 - 416 (2%)State Agencies 1526 1888 2539 85 2950 8943 1250 2141 25434Total 1750 1888 2570 182 2982 9034 1418 2141 26148

Paddy Procurement Centres Operated

Procurement of Paddy (In LMT, as on 25.07.12)

source Punjab Chgs. Odisha Haryana U.P. Bihar A.P. W.B. All India Total

FCI 1.84(2%)

- 0.08(0.2%)

Neg. (0.01%)

0.03(0.13%)

0.91(4%)

0.69 (3%)

- 4.21(1.12%)

State Agencies 113.55 59.71 41.52 29.34 23.21 21.96 20.53 12.14 369.88Total 115.39 59.71 41.60 29.34 23.24 22.87 21.22 12.14 374.09

Rice Procurement during KMS 2011-12

Source Punjab A.P. Chgs. U.P. Odisha Haryana W.B. All India Total

FCI 1.23(2%)

60.57(81%)

1.15(3%)

17.95(54%)

0.34(1%)

0.19(1%)

4.86(28%)

89.60(26%)

State Agencies 76.08 13.76 40.00 15.55 27.82 19.65 12.77 256.08

Total 77.31 74.27 41.15 33.50 28.16 19.84 17.63 345.68

Figrs in Lakh MTsPosition as on July 24,2012

Scheme of Decentralized Procurement

Scheme of Decentralized Procurement

Introduced by GoI in 1997-98. Under DCP Scheme, the State Govts. themselves

undertake purchase of paddy & Wheat. While the excess stocks are taken over , shortage if

any, is replenished. GoI meets the expenditure incurred by State Govt.

on procurement operations.

Scheme of Decentralized Procurement (Contd..)

The State becomes self-sufficient in production and procurement

Boosts local cultivation and enhances coverage of MSP

Higher local production and procurement. Saves huge costs towards freight Additional revenue to the State Govt. by way of

levy and taxes Generation of direct and in-direct employment

Scheme of Decentralized Procurement (Contd…)

The State Govts. are paid advance subsidy to the extent of 100% towards MSP & Statutory taxes

For remaining incidentals such as Storage Charges, Interest and Mandi Labour Charges etc. 95% of the provisional cost is paid to the State Govt.

The remaining 5% is settled after receipt of audited accounts from the State Govt.

DCP & Non-DCP States

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S.N State With Effect From

1M.P. 1999-2000

2Uttrakhand 2003-04

3Chhattisgarh 2001-02

4Gujarat 2004-05

5Maharashtra 2008-09

6West Bengal 2010-11

S.N. State With Effect From

1 Uttrakhand 2002-03

2 Chhattisgarh 2001-02

3 Orissa 2003-04

4 Tamilnadu 2002-03

5 W.B. 1997-98

6 Kerala 2004-05

7 A&N 2003-04

8 Karnataka 2009-10

10 M.P. 2007-08

10 Puducherry 2009-10

U.P. was a DCP states for Wheat & Rice from 1999-2000 till 2010-2011

DCP for Wheat DCP for Rice

Rice Procurement during KMS 2010-11 & 2011-12

(DCP & Non-DCP States)(Figures in Lakh MT) Sl.

No. State/UT KMS 2010-11* KMS 2011-12*(25.07.2012) Difference

DCP States1 Chattisgarh 37.46 41.15 3.692 Orissa 24.65 28.16 3.513 Tamil Nadu 15.43 15.96 0.534 West Bengal 13.10 17.64 4.545 M.P. 5.16 6.37 1.216 Uttarakhand 4.22 3.78 -0.447 Kerala 2.63 3.72 1.098 Karnataka 1.80 3.56 1.76

Total DCP 104.45 (31%) 119.63 (35%) 15.18Non-DCP States

1 Andhra Pradesh 96.09 74.33 -21.76 2 Punjab 86.35 77.31 -9.043 U.P. 25.54 33.50 7.974 Haryana 16.87 19.84 2.975 Bihar 8.83 15.34 6.516 Maharashtra 3.08 1.58 -1.507 Others 0.77 3.45 2.68

Total Non-DCP 237.53 (69%) 225.35 (65%) -12.17Grand Total 341.98 345.68 3.70

19

During KMS 2010-11, DCP

states contributed 31% of total

Rice procurement,

whereas during KMS 2011-12 (as

on 25.07.12), the share of DCP States

has increased to

35%.

Wheat Procurement during RMS 2011-12 & 2012-13(as on 25.07.12)

(Contribution by DCP & Non-DCP States)(Figures in Lakh MT)

20

During RMS 2011-12, DCP

states contributed 18%

of total wheat procurement,

whereas during RMS 2012-13 (as on 10.07.12), the

share of DCP States has

increased to 23%.

Sl. No. State/UT RMS 2011-12

RMS 2012-13 Variation(25.07.2012)

DCP States    1 M.P. 49.65 84.93 35.282 Gujarat 1.05 1.56 0.513 Uttarakhand 0.42 1.39 0.97  Total DCP 51.12(18%

)87.88 (23%) 36.77

Non-DCP States    4 Punjab 109.57 128.34 18.775 Haryana 69.28 86.65 17.376 U.P. 34.61 50.63 16.027 Rajasthan 13.03 19.64 6.618 Bihar 5.56 7.38 1.819 Delhi 0.08 0.31 0.23

10 Others 0.10 0.31 0.22

  Total Non-DCP 232.13 (82%)

292.95 (77%) 60.81

  Grand Total 283.35 381.14 97.79

Current position of Eastern States

Production and Procurement of Paddy during KMS 2011-12 in Eastern States

State Production Procurement Proc as % of Production

1.Bihar 105.70 22.87 21.632. WB 233.60 12.14 5.20

3.Odhisha 86.50 42.00 48.504. Jharkhand 56.15 4.48 8.005.Chhatisgarh 94.10 59.70 63.446.Assam 81.60 0.31 0.377.UP 135.00 25.54 18.90

Fig. in LMT

Production and Procurement of Wheat during RMS 2012-13 in Eastern States

State Production Procurement Proc as % of Production

1.Bihar 63.08 7.48 11.852. WB 9.00 0.02 Neg.3.Odisha 0.34 NIL NA4. Jharkhand 2.40 NIL NA5.Chhatisgarh 1.22 NIL NA6.Assam 1.30 NIL NA7.UP 295.0 51.0 17.28

Fig in LMT

Position of Milling Capacity in Eastern States

State No of MillsMilling

Capacity per month

1.Bihar 363 1.11 LMT2. WB 1018 4.40 LMT3.Odisha 1050 4.00 LMT4. Jharkhand 102 0.35 LMT5.Chhatisgarh 1453 16.30 LMT6.Assam 927 1.00 LMT7.UP 3092 20.00 LMT

Some State Specific Issues

Production vis-à-vis procurement of Paddy in Assam for last 5 yrs

Year Production In LMT

Total Procurement In LMT

Procurementby FCI in LMT

2007-08 52.16 NIL NIL

2008-09 63.78 0.041 0.041

2009-10 68.98 0.121 0.121

2010-11 78.72 0.232 0.232

2011-12 81.60* 0.31 0.312012-13 101.40 (Target) 0.30 (estimate) --

* Approximate

Some important reasons for poor procurement in Assam

Poor-involvement of state machineries to assist procurement operations .Lack of Regulated market and its basic infrastructure. No Levy order /policy declared by State Govt. Inadequate Milling capacity and modern rice mills.Millers are reluctant to mill paddy for low milling charges and no transport charges less than 8 Kms distanceErratic power supply affecting milling Non availability of adequate Storage facilities in surplus production areasShortage of QC manpower for procurement operations Local law and order problems; frequent bandhs, chakka jam etc.

Production vis-à-vis procurement in Bihar for last 5 Years

KMSProductio

n In LMT

Total Procuremen

t In LMT

2007-08 44.72 5.452008-09 57.71 11.152009-10 36.00 8.542010-11 33.20 8.092011-12 70.45* 15.32*

* Estimated figures

Rice

RMSProductio

n In LMT

Total Procuremen

t In LMT

2008-09 46.39 4.992009-10 45.70 4.962010-11 52.16 1.832011-12 68.40 5.562012-13 63.08 15.00*

Wheat

Few issues in Procurement Operations in Bihar

Lack of Organized Mandi systemNo Post Harvest operations carried out by the farmersNo competitive spot bidding.Heavy dependence on PACS, which lacks infrastructures.Inadequate Storage CapacityUnavailability of high Capacity Modern rice mills.Concentration of mills in some Pockets.Lack of adequate QC manpower with State Agencies

Production vis-à-vis procurement in West Bengal for last 5

Years

KMSProductio

n In LMT

Total Procuremen

t In LMT

2007-08 147.20 14.272008-09 150.37 17.382009-10 143.41 12.952010-11 133.90 13.172011-12 159.00 17.64*

* As on 25.07.12

Rice

RMSProductio

n In LMT

Total Procuremen

t In LMT

2007-08 9.17 -2008-09 9.17 -2009-10 7.65 -2010-11 8.02 0.092011-12 8.74 -

Wheat

Production vis-à-vis procurement of Rice in

Orissa for last 5 Years

KMS Production In LMT

Total Procurement In LMT

2008-09 69.15 28.422009-10 70.22 24.822010-11 69.31 24.772011-12 58.82 28.822012-13 (Est.) 75.40 -

* As on 25.07.12

Production vis-à-vis procurement of Rice in

Jharkhand for last 5 Years

* As on 25.07.12

KMSProductio

n In LMT

Total Procuremen

t In LMT

2007-08 22.28 0.192008-09 22.78 1.432009-10 9.85 0.232010-11 7.48 -2011-12 37.62 2.93*

Rice

RMSProductio

n In LMT

Total Procuremen

t In LMT

2007-08 1.30 -2008-09 1.54 0.022009-10 1.54 0.0022010-11 1.51 0.0022011-12 1.05 -

Wheat

Few issues in procurement Operations in Jharkhand

Heavy dependence on monsoon.Non-involvement of Multiple Agencies in

procurement.Lack of milling infrastructureOnly one month storage capacity

available. Cumbersome land acquisition acts/rules 

Sl No State Credit Limit (Rs. Crore)

1. Chhattisgarh 6,000

2. Madhya Pradesh 8,000

3. Uttar Pradesh 8,361*

4. Bihar 200

5. West Bengal 155

6. Assam Nil

7 Gujrat 100

8 Rajasthan Nil

9 J&K Nil

Credit Limits taken by State Governments / Agencies for Procurement during 2011-12

* Given by State Government in their food budget, which caters to procurement requirement also.

The high credit limit obtained by MP and Chhattisgarh explains their increased share in procurement in last few years.

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PEG SCHEME AT A GLANCE IN BIHAR (3,00,000 MT)PEG SCHEME AT A GLANCE IN BIHAR (3,00,000 MT)

Sl. No. Item CWC SWC Private1 CAPACITY ALLOTTED - 30,000 2,70,0002 CAPACITY FINALISED - 30,000 90,000(i) Completed - 10,000 -(ii) Taken Over - 10,000 -(iii) Under Construction - 20,000 50,000(iv) Work yet to Start - - 40,0003 Balance capacity (1 - 2) - - 1,80,000(i) Tender Enquiry Issued - - 1,80,000(ii) Silos - - 2,00,000(iii) Yet to Tender - - -

4 Combined Target 2011-12 and 2012-13

- 30,000 -

5Additional capacity 6,40,000 MT additional capacity has been

approved by HLC in its meeting on 18.07.2012. Out of this, 2,00,000 MT is to be created as silos.

PEG SCHEME AT A GLANCE IN ODISHA (3,00,000 MT)PEG SCHEME AT A GLANCE IN ODISHA (3,00,000 MT)

Sl. No. Item CWC SWC Private1 CAPACITY ALLOTTED 1,87,500 1,12,500 - 2 CAPACITY FINALISED 1,87,500 1,12,500 -(i) Completed 82,000 50,000 -(ii) Taken Over 55,400 50,000 -(iii) Under Construction 70,000 42,000 -(iv) Work yet to Start 35,500 20,000 -3 Balance capacity (1 - 2) - 500 -(i) Tender Enquiry Issued - - -(ii) Silos - - -(iii) Yet to Tender - - -

4 Combined Target 2011-12 and 2012-13 1,00,750 82,000 -

PEG SCHEME AT A GLANCE IN JHARKHAND (1,75,000 MT)PEG SCHEME AT A GLANCE IN JHARKHAND (1,75,000 MT)

Sl. No. Item CWC SWC Private1 CAPACITY ALLOTTED - - 1,75,0002 CAPACITY FINALISED - - 85,000(i) Completed - - -(ii) Taken Over - - -(iii) Under Construction - - 40,000(iv) Work yet to Start - - 45,0003 Balance capacity (1 - 2) - - 90,000(i) Tender Enquiry Issued - - 90,000(ii) Silos - - -(iii) Yet to Tender - - -

4 Combined Target 2011-12 and 2012-13 - - 20,000

PEG SCHEME AT A GLANCE IN WEST BENGAL (1,56,600 MT)PEG SCHEME AT A GLANCE IN WEST BENGAL (1,56,600 MT)

Sl. No. Item CWC SWC Private1 CAPACITY ALLOTTED 29,600 - 1,27,0002 CAPACITY FINALISED 29,600 - -(i) Completed - - -(ii) Taken Over - - -(iii) Under Construction 29,600 - -(iv) Work yet to Start - - -3 Balance capacity (1 - 2) - - 1,27,000(i) Tender Enquiry Issued - - 1,27,000(ii) Silos - - 2,00,000*(iii) Yet to Tender - - -

4Combined Target 2011-12 and 2012-13 - - -

* Silo is to be created from additional capacity for which SLC proposal is awaited.

Conclusions There is plenty of scope for procurement in eastern

states of the country Assam, Bihar, and Jharkhand, may become DCP States,

so that they become self reliant Necessary infrastructure in terms of manpower, storage

facilities, milling capacities, mandi arrangements etc. are required to be provided & even expanded

Apart from the storage capacity being created under PEG by FCI/GoI, State Governments should also endeavour to create additional storage capacity especially for intermediate storage

State Agencies may recruit adequate QC personnel, so as to ensure that procured stock meets specifications. FCI can impart basic training to such QC staff.

Multiple agencies/Cooperative Societies are required to be involved

47

Thanks