World’s Largest Grain Storage Plan in Cooperative Sector

The National Cooperative Grain Storage Project, launched in 2023, is a ground-breaking initiative aimed at revolutionizing grain storage in the cooperative sector in India. With a financial outlay of 1 trillion rupees, this project is set to address the critical need for increased food grain storage capacity in the country, leveraging a ‘whole-of-Government’ approach.

Scheme Overview

• Scheme Launched: Launched in 2023.
• Scheme Fund Allocated: 1 trillion rupees.
• Type of Government Scheme: Central Government of India.
• Sponsored / Sector Scheme: Cooperative sector.
• Target: To raise India’s food grain storage capacity by 700 lakh tonnes in cooperative sector

Latest News about the scheme

• Rolled out as a Pilot Project.
• Implementation in 24 PACS across 24 different States/UTs.
• Construction initiated in 5 PACS in Tripura, Haryana, Tamil Nadu, Uttar Pradesh, and Madhya Pradesh.
• Aim to raise India’s foodgrain storage capacity by 700 lakh tonnes in the cooperative sector
• 65,000 agricultural cooperative societies are currently functional in India.
• About 3,100 lakh tonnes of foodgrains is produced every year
• Current godown facilities can store up to 47 per cent of total production.

Benefits

1. Increased Foodgrain Storage Capacity: The primary objective of the National Cooperative Grain Storage Project is to substantially raise India’s foodgrain storage capacity by 700 lakh tonnes in the cooperative sector. This massive increase in storage capacity is crucial for safeguarding food security and preventing the wastage of valuable agricultural produce.
2. Reduction in Foodgrain Wastage: One of the most significant advantages of the project is the reduction in foodgrain wastage. With enhanced storage facilities, grains can be stored for more extended periods without spoilage or damage, minimizing post-harvest losses. This directly contributes to increased availability of food and better utilization of resources.
3. Strengthening Food Security: By ensuring that a more substantial portion of the food grain produced in India can be stored safely, the project plays a vital role in strengthening the nation’s food security. It helps maintain a stable supply of essential food items, even during adverse conditions like crop failures or natural disasters.
4. Preventing Distress Sale of Crops: Inadequate storage facilities often force farmers to sell their crops at lower prices immediately after harvest, leading to distress sales. The project empowers farmers to store their produce and sell it at better prices when market conditions are more favorable, reducing financial stress.
5. Better Prices for Farmers: With improved storage and reduced post-harvest losses, farmers can negotiate better prices for their crops. They are no longer compelled to sell at rock-bottom rates due to immediate market pressures, enhancing their income and overall livelihoods.
6. Cost Savings in Grain Transportation: The decentralization of storage to the block level means that grains do not need to be transported over long distances to central storage facilities. This reduces transportation costs, making it more economically viable for farmers and reducing the burden on government agencies.
7. Increased Access to Loans: Farmers associated with the cooperative societies can benefit from the scheme by accessing loans of up to 70% of the value of their stored grains. This financial assistance can be pivotal in meeting various agricultural needs, such as purchasing seeds, and equipment, or investing in crop diversification.
8. Inter-Ministerial and National-Level Oversight: The project’s governance structure includes Inter-Ministerial and National Level Coordination Committees, ensuring effective oversight and management. This helps streamline implementation and address issues promptly.
9. Contribution to Rural Development: The project’s focus on strengthening the cooperative sector contributes to rural development by creating employment opportunities, improving infrastructure, and promoting self-reliance among local communities.
10. Long-term Storage Expansion: Over the next five years, the project aims to expand storage capacity to 2,150 lakh tonnes. This long-term vision ensures a sustainable solution to the perennial problem of inadequate storage and food grain wastage.

Drawback

• The scheme’s effectiveness may vary based on the region and the level of participation and cooperation among farmers and PACS.
• While the National Cooperative Grain Storage Project holds immense promise, it’s important to acknowledge potential challenges and limitations:

• Regional Disparities: The scheme’s effectiveness may be influenced by regional disparities in terms of infrastructure, participation, and cooperation among farmers and Primary Agricultural Credit Societies (PACS). 
• Operational Efficiency: The successful operation of the decentralized storage facilities and other infrastructure at the PACS level relies heavily on efficient management, maintenance, and adherence to quality standards. In areas with limited administrative capacity or training, there may be issues related to the proper functioning of these facilities.
• Financial Sustainability: Sustaining the project’s massive storage capacity expansion over the long term may pose financial challenges. Ensuring adequate funding for maintenance, upgrades, and addressing unforeseen issues will be crucial to prevent the infrastructure from deteriorating.
• Market Access: While the project aims to empower farmers by reducing intermediaries and enabling better prices, it does not directly address challenges related to market access, price fluctuations, and marketing of agricultural produce. Farmers may still face hurdles in getting their produce to markets and obtaining fair prices.

Conclusion

The National Cooperative Grain Storage Project is a landmark initiative that promises to enhance food security, reduce wastage, and empower farmers across India by significantly increasing grain storage capacity at the grassroots level. This scheme is a testament to the government’s commitment to transforming the agricultural landscape and ensuring the well-being of the farming community.