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EGoM may revise issue price for PDS sugar by Devika Banerji & Ajay Modi


An Empowered Group of Ministers (EGoM) headed by Finance Minister Pranab Mukherjee is likely to revise the issue price of levy sugar for the public distribution system (PDS). The group is going to meet on Thursday with a three-point agenda for discussion.

The government had recently increased the price of levy sugar for mills, which is meant for PDS, to an average of Rs 17.57 per kg for the 2009-10 crop year, which runs from October to September. Earlier, the issue price for levy sugar for mills was fixed at Rs 13.22 per kg.

However, the government had not increased the central issue price at which it gives to consumers, who constitute families under the below poverty line category. The central issue price is currently Rs 13.50 per kg and has remained static since March 2002.

Officials indicated that EGoM might take a decision to revise the issue price upwards.

Apart from revising the issue price for levy sugar, the group of ministers will consider extending import subsidy of 15 per cent on pulses, even as the kharif sowing pattern shows increased area coverage under the crop. Recent data from the agriculture ministry show acreage of pulses has registered the highest annual increase of 21.38 per cent to 109.52 hectares till September 2.

The import subsidy of 15 per cent was expected to expire on March 31 but was extended to September 30 in an earlier meeting of EGoM. Now, the government is considering to extend the subsidy further.

India, the world’s largest importer and consumer of pulses, depends on imports as domestic production is lower than annual demand. In 2009-10, domestic production amounted to 14.74 million tonnes against an annual demand of around 17 million tonnes.

Official sources said EGoM would take into consideration the procurement and stock limit of the Food Corporation of India and would also review the bulk Open Market Sale Scheme, which is seeing a lukewarm response.