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EGoM likely to meet next week to decide on wheat exports

24 May 2012 Evaluate

An Empowered Group of Ministers (EGoM) chaired by Finance Minister Pranab Mukherjee is expected to meet next week to decide on wheat exports and added supply of the grain via public distribution shops in order to tide over the foodgrain storage crises. Food Minister K V Thomas said, ‘by and large, we agree with recommendations made by the Rangarajan panel to handle surplus stocks. Based on those suggestions, we are preparing a note for the EGoM meeting likely to be held next week.’

A committee, headed by chairman of the Prime Minister's Economic Advisory Council (PMEAC) C Rangarajan, submitted a report last week to the Prime Minister signifying offloading of 10 million tonnes of wheat to below poverty line and above poverty line families and 3 million tonnes via open market sale. It also suggested 2 million tonnes of wheat export from government warehouses.

The EGoM is expected to take a final view on the suggestions made by the panel, as massive subsidies are involved, estimated to be around Rs 17,000 crore. The Commerce Ministry on its part is analyzing the stocks available for the wheat exports. Further, the Ministry all the way through state-run STC, to discover export prices has invited tender.

Moreover, the Prime Minister under chairmanship of PMEAC Rangarajan has also set up an expert panel, to put in order a strategy to use surplus grains to avoid the storage problems. Currently, the government has storage capacity to hoard 62.8 million tonnes of food grains, whereas the foodgrains stocks are likely to touch 75 million tonnes by end of May on the back of record production and procurement.

In September 2011, the government lifted the wheat export ban and from the time only 800,000 tonnes of the grain have been exported as shipments were unviable. In the wake of abundant production and procurement in the last few years, government’s food grains stocks are increasing with wheat production likely to touch a record 90.2 million tonnes this year.

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