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Steps to incentivize the export of raw sugar



Steps to incentivize the export of raw sugar 
The Government has taken a number of steps to incentivize the export of raw sugar produced in the country and use the proceeds to clear sugarcane dues. Export subsidy in the form of incentive for Marketing and Promotion Services of Raw Sugar Production has been provided during 2013-14 and 2014-15 sugar seasons. The incentive available under the scheme is utilized for clearing cane price dues of farmers. Incentive of Rs 183.87 crores was disbursed during 2014-15 financial year and about Rs 97 crores has been disbursed during current financial year till 30th November, 2015. This information was given by the Minister of Consumer Affairs, Food and Public Distribution, Shri Ram Vilas Paswan in a written reply in Lok Sabha today. 


The Minister said that with a view to boost the price sentiments in the domestic market and reduce the surplus stocks of sugar, 40 Lakh MT of sugar has been allocated as Minimum Indicative Export Quota (MIEQ) amongst 570 sugar mills for current sugar season 2015-16 and have been asked to discharge their export obligation accordingly. 
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Over 1.20 crore bogus rations cards deleted during the last three years 

  An evaluation study on functioning of Targeted Public Distribution System (TPDS) in six selected States namely, Assam, Bihar, Chhattisgarh, Karnataka, Uttar Pradesh and West Bengal was awarded to the National Council of Applied Economic Research (NCAER) in March 2014 and final report was accepted in the Department in November, 2015.  Based on 2011 census and the family size estimates projected over 2015, the study has estimated the number of excess ration cards made in the six target States as per details given below:  

State
Excess cards issued
(in lakh)
Assam
-
Bihar
33.92
Chhattisgarh
10.84
Karnataka
2.15
Uttar Pradesh
98.39
West Bengal
19.39

This information was given by the Minister of Consumer Affairs, Food and Public Distribution, Shri Ram Vilas Paswan in a written reply in Lok Sabha today.
        
  The Minister said that detection and deletion of fake cards does not mean reduction in allocation and savings in subsidy but results in selection of deserving beneficiaries and issuance of ration cards to them leading to better targeting of subsidy.

  He said that with an aim to strengthen the TPDS and to curb diversion/leakage, a Nine Point Action Plan was evolved in July 2006 and forwarded to State/UT Governments for implementation by them.  The various points of action included undertaking of campaign by State Governments for review of Below Poverty Line (BPL) / Antyodaya Anna Yojana (AAY) lists, to eliminate ghost ration cards.

  He added that further, in terms of the PDS (Control) Order, 2001, dated 31.08.2001, State/UT Governments are to review the lists of BPL and AAY families every year for the purpose of deletion of ineligible families and inclusion of eligible families. The exercise of deletion of bogus/ineligible cards and inclusion of eligible families is a continuous process and State Governments are to periodically carry out the same.  The TPDS (Control) Order, 2015 notified on 20.03.2015 also calls for all the necessary action to be taken by State/UT Governments for review of list of beneficiaries and deletion of bogus /ineligible ration cards. 

  The Minister said that as a result of implementation of Nine Point Action Plan since July 2006, 30 State/UT Governments have reported up to 30.06.2015, deletion of 494.50 lakhs bogus / ineligible ration cards.

  He said that in a continuous endeavour to strengthen and streamline TPDS, the Government has initiated implementation of a plan scheme on ‘End-to-end Computerisation of TPDS Operations’ during the 12th Five Year Plan (2012-17) to ensure transparency and check leakages in the TPDS system.  Under the scheme, financial assistance is being provided to States/UTs on cost sharing basis. The cost is being shared on 90:10 basis with North East States and on 50:50 basis with other States/UTs.  Under this scheme, as per reports received, as on 31.10.2015, ration card data digitization has been done in 29 States/UTs, ration card data is available on Web Portal in 27 States/UTs, Online allocation is being done in 16 States/UTs, supply-chain management in 8 States/UTs, Transparency Portal set up in 27 States/UTs, online Grievance Redressal Mechanism in 26 and toll free helpline number has been set up in 32 States/UTs.  

  He added that as part of beneficiary data digitization, States/UTs have been requested to seed the Aadhaar numbers wherever available so as to weed out the ineligible/bogus/duplicate beneficiaries. As part of Fair Price Shop (FPS) automation at FPS, use of Aadhaar will ensure proper identification of beneficiaries and distribution of foodgrains only to the intended beneficiaries thereby reducing leakage / diversion, etc.

  To curb leakages further, under the National Food Security Act, 2013 (NFSA) inter alia, States/UTs have been asked to either do cash transfer of food subsidy under Direct Benefit Transfer (DBT) or install electronic Point of Sale Device (ePoS) at the FPSs. 

The number of bogus/ineligible rations cards deleted by the State/UT for the last three years and current year

S. No.
STATE/UT
2012
2013
2014
2015
Total
1
Andhra Pradesh $
191699



191699
2
Arunachal Pradesh




0
3
Assam
86346
50204
6483

143033
4
Bihar




0
5
Chhattisgarh


94209

94209
6
Delhi
57680



57680
7
Gujarat#
407
0
0

407
8
Haryana




0
9
Himachal Pradesh
235



235
10
Jammu & Kashmir
3794



3794
11
Jharkand




0
12
Karnataka
3300000
1977836


5277836
13
Kerala

279


279
14
Madhya Pradesh




0
15
Maharashtra
0
0


0
16
Meghalaya




0
17
Mizoram




0
18
Nagaland
13310



13310
19
Orissa




0
20
Punjab
0
7982


7982
21
Rajasthan




0
22
Sikkim




0
23
Tamilnadu   




0
24
Uttar Pradesh
19413



19413
25
Uttarakhand




0
26
West Bengal
3966906
2276085


6242991
27
A&N Islands
8923
1340


10263
28
Chandigarh




0
29
Lakshdweep




0
30
Puducherry
47
17381
161
9370
26959

Total
7648760
4331107
100853
9370
120,90,090
# Information upto May, 2014.
$ Including State of Telangana

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Disposal of seized pulses 
In Maharashtra, the seized quantities of pulses are being released to the concerned importers/traders against indemnity bond with the condition to sell the same at Rs. 100/- per kg within Maharashtra. This decision will help to improve the supply situation and bring down the prices of pulses in Maharashtra. This information was given by the Minister of Consumer Affairs, Food and Public Distribution, Shri Ram Vilas Paswan in a written reply in Lok Sabha today.

The Minister said that the Government decided to import pulses through MMTC under the Price Stabilization Fund. MMTC imported 5000 MT of Tur Dal. The stock was offered to the States at Rs. 69/- per kg. A total of 4927 MT Tur Dal has been received and allocated to the States.

He said that action against hoarding and blackmarketing is to be taken by the State Governments. Government of India has already empowered the States to enforce stock limits on pulses and undertake effective anti-hoarding operations. 
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All BIS laboratories to be upgraded 
The Bureau of Indian Standards (BIS) has taken up modernization and up-gradation of its laboratories. A plan has accordingly been chalked out which includes;

• Replacement of existing old/obsolete test equipment

• Up-gradation of test facilities

• Setting up laboratories for new products.

The time frame for completion of this plan is December, 2016.

This information was given by the Minister of Consumer Affairs, Food and Public Distribution, Shri Ram Vilas Paswan in a written reply in Lok Sabha today.

The Minister said that the Standards for food products have been prescribed in the Food Safety and Standards (Food Product Standards and Food Additives) Regulation, 2011 and Food Safety and Standards (Contaminants, Toxins and Residues) Regulation, 2011. These standards are applicable to Street Food also.

He said that Hygienic and Sanitary practices are prescribed in Part V of Schedule 4 under the Food Safety Standards (Licensing & Registration of Food Businesses) Regulations for Food Business Operators engaged in catering/Food service establishments.

He added that the development of Standards is a continuous process. The Indian Standards are reviewed every five years or whenever any comments are received on these standards. Based on the review, the Standards are revised, if so required.

He said that during 2014-15, five new Standards have been published for the food products. Also, during this period, twelve food standards have been revised. 
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Non-inclusion of byproducts value in fixation of paddy milling charges is not correct 
Union Food Ministry has clarified that reports regarding non-inclusion of value of by-products in fixation of milling charges for paddy are not correct. The facts are as follows:

The Department of Food & Public Distribution fixes milling charges for paddy to be paid to the State Agencies from time to time based on the rates recommended by the Tariff Commission, which takes into accounts the value of by-products derived from paddy while suggesting net rates of milling based on income and expenditure of the rice millers.

The Food Corporation of India (FCI) is the Central Nodal Agency for procurement of food grains and it undertakes procurement operations of wheat and paddy/ rice in association with the State Government Agencies (SGAs). In the case of paddy, it is essential that SGAs convert paddy procured from the farmers, as early as possible, and handover resultant custom milled rice (CMR) to the FCI for distribution. Government of India, through FCI, pays cost of CMR to the SGAs including the cost of conversion of paddy into rice. The processing of paddy has to be done in a time bound manner, as shelf-life of paddy is limited, and for this purpose, SGAs engage rice millers under well defined agreements with them.

For reimbursement of milling charges to the SGAs, the Department of Food & Public Distribution has adopted a rate structure based on the recommendations of the Tariff Commission. As, it is not practically feasible for the FCI or SGAs to take over the by-products derived from the processing of paddy and market them out, therefore, the basic framework of Tariff Commission formula for milling charges has been arrived at based on the premise that the rice millers will retain the by-products themselves and the value of these by-products will be taken into account by the Tariff Commission while calculating and recommending the net milling charges to be paid to the millers. Following this formula of the Tariff Commission, the Department has been all along reimbursing the milling charges to the SGAs without separately taking into account the value of the by-products arising out of the processing of paddy.

The existing rates for milling of paddy were fixed on the basis of recommendations given by Tariff Commission in year 2005. In its report, Tariff Commission had observed that gross milling cost and realization from milling by-product varies from mill to mill and State to State. Similarly, cost towards transportation and forwarding also varies. Therefore, Tariff Commission was of the view that it was not feasible to specify reason/State specific milling charges and based on their study report, and they had recommended fixation of milling charges for raw rice @ Rs. 15.32/qtl. and for Par-boiled rice @ Rs. 25.48/qtl. including the cost of transportation of paddy upto 8 kms. and transportation of rice for the same distance for delivery to the FCI/ SGAs.

The report submitted by Tariff Commission was examined by the Department and current rate of milling charges were fixed @ Rs. 15/qtl. for raw rice and Rs. 25/qtl. for Par-boiled rice in 2005, including the charges for transportation of paddy up to 8 km from mandi/stocking point to mills and Rice from mills to FCI storage godowns up to 8 km. However, in case, any of the State Governments arrange transportation of paddy/ rice themselves, then they are paid transportation charges separately and Milling Charges are paid only @ Rs.10/qtl for Raw Rice and Rs.20/qtl for Par-boiled Rice. These rates were made applicable w.e.f. KMS 2006-07 vide Order No. 192(12)/1997-FC A/c dated 04.06.2006.

Keeping in view the requests received from some State Governments for revision of milling charges in the light of the increase in milling cost and likely increase in income from the by-products of paddy, Tariff Commission was assigned to conduct another study in year 2009 and their report was received in year 2012. However in its report, Tariff Commission failed to make any specific recommendation on upward/downward revision of milling charges due to non-availability of sufficient data and recommended for maintaining status-quo which was accepted by this Department and it was decided to continue with the existing milling charges.

As many State Governments were requesting for upward revision of milling charges on the ground that existing rates were fixed in 2005 and milling costs had increased, the Adviser (Cost), Department of Food & Public Distribution was asked to make a quick review of the situation with. In its recommendations, Team headed by the Adviser (Cost) had analysed both Tariff Commission of 2005 & 2012 and studied the information received from the millers/ State Governments etc. and had recommended that taking into consideration the existing well-defined uniform out-turn ratios and yield and the value of by-products, there was no scope for an increase in the milling charges of raw rice. The Team, further recommended that the existing milling charges be continued. The report of the Committee was accepted with due approval of the then MOS(IC) CA, F&PD on 26.02.2013. This report makes it clear that value of by-products have always been taken into account by Tariff Commission while recommending the normative rates of milling charges to be paid to SGAs.

Some news reports say that on the count of value of by-products, Government is losing every year more than Rs. 10000 crore, for which there is no evidence. It talks of the increase in value of by-products of paddy processing over the years, but it does not talk about increases in the expenses of the rice mills. Since most of the States have been demanding an upward revision of the normative milling charges citing that millers are facing hardships and they are not interested in milling the paddy procured by the SGAs, the Department of Food & Public Distribution had moved to Tariff Commission for conducting a fresh study for reviewing the normative milling charges in December, 2013 itself. Tariff Commission is expected to give its report by December, 2015.

Department of Food & Public Distribution has further asked Tariff Commission to conduct a fresh study on milling expenses, value of by-products etc. and make a fresh recommendation about the net milling charges to be paid to the millers. It is expected that Tariff Commission will provide its report by the end of December, 2015 and the Department will take a decision about the revision of rates accordingly. 


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