GoM opposes hike in APL foodgrain rates

GoM opposes hike in APL foodgrain rates

New Delhi: With general election round the corner, a Group of Ministers has rejected a proposal to raise the prices of wheat and rice supplied to APL families through ration shops.

The GoM, headed by External Affairs Minister Pranab Mukherjee, decided last week to ‘retain the status quo´ on the central issue prices of foodgrains for APL (above poverty line) category, a source said.

Concerned over rising subsidy bill, which is likely to cross Rs50,000 crore this fiscal, the Food Ministry had proposed to hike the central issue prices (CIPs) of rice and wheat to their minimum support prices (MSPs) levels, the source said.

The CIPs of wheat and rice for the APL families are Rs6.10 and Rs8.30 per kg, respectively, which have not been revised since 2002. The MSPs of wheat and rice are Rs10 and Rs8.50 a kg, respectively.

“The proposal is not new. The Food Ministry has been suggesting for a hike for the last four years," he said.

Though states estimate the number of APL families at 13.13 crore as on October 2008, the Centre approves only 11.52 crore families based on Planning Commission guideline. Each APL family is eligible to buy 35 kg of foodgrains (both wheat and rice) in a month.

According to Food Ministry data, the economic costs of wheat and rice have increased manifold since then and are at Rs14.58 and Rs16.99 a kg now, respectively due to increase in their MSPs and handling costs.