Congress in an attempt to stick to the “promise made to the people” prepared a new food security bill, which is to reconcile and rework an earlier plan on fiscal constraints. The UPA government had pulled the plug on a previous draft, after it was found wanting by the Congress leadership in August last year. A striking feature to be noted is that the National Advisory Council which oversees the government’s welfare agenda was led by Sonia Gandhi who made slew recommendations like keeping the country’s food distribution system open regardless of poverty status.

Worried by budgetary concerns PM Manmohan Singh asked his Economic Advisory Council (EAC) led by C Rangarajan, to find out the financial implications of the NAC’s recommendation. Though EAC had suggested restricting cheap grains to priority household only, the new bill provides for legal entitlement for both priority and general categories. The new bill is in line with the NAC’s draft food bill and accordingly all BPL households would be given 7 kg per person or 35 kg per family of government held grains at a subsidized price of Re.1 for a kg of millet, wheat for Rs.2 a kg and rice for Rs.3 a kg. Those above the poverty line will get 3 kg per person which is a little less than recommended by NAC. And this would be made available at half the price at which the government buys from farmers also called the minimum support price (MSP). Further the bill also proposes to provide for cash benefits to meet enhanced food requirements.

This bill if passed could mean that the Government’s expense on distributing cheap grains could rise from Rs. 83 000 crores to Rs. 1 lakh crores and an additional 10 million tonnes of food grains has to procured.

The bill has tried hard to strike a balance between the EAC’s budget concerns and NAC’s social concerns!

Report by Sumit