Stability in Farming: Ensuring Affordability and Availability of Essential Food Commodities

As the festive season approaches, the Indian government stands resolute in its commitment to farmers and consumers alike. Shri Sanjeev Chopra, the Secretary of the Department of Food and Public Distribution, recently highlighted the measures taken by the government to maintain stable prices of essential food commodities. These actions reflect a dedicated effort to safeguard the interests of both the 140 crore domestic consumers and the agricultural community that plays a vital role in ensuring food security.

Overview

In a concerted effort to ensure stability in essential food commodity prices, the Indian government has taken proactive measures in the sugar and rice sectors. These measures include the continued restriction of sugar exports to maintain domestic availability and promote greener fuel production. India’s retail sugar prices remain among the world’s most affordable, despite global price spikes. The government is also closely monitoring sugar dispatches and mandating stock disclosures for stakeholders. In the rice sector, export restrictions have been imposed, with an extended export duty on parboiled rice to curb price increases. Specific allocations have been made for rice exports to select countries, striking a balance between domestic food security and international commitments. These initiatives reflect the government’s unwavering commitment to both farmers and consumers, ensuring affordability and accessibility of essential food commodities.

Key points

1. Restriction on Sugar Exports: To ensure a consistent supply of sugar at reasonable prices throughout the year, the Indian government has decided to continue restricting sugar exports until further notice. This strategic move serves a dual purpose: it guarantees adequate sugar stocks within the country and aligns with India’s commitment to greener fuel production through the Ethanol Blended with Petrol (EBP) Programme.
2. Extension of Export Restrictions: In line with this approach, the Directorate General of Foreign Trade (DGFT) issued a notification on October 18, 2023, extending the date for restrictions on the export of Sugar (including Raw Sugar, White Sugar, Refined Sugar, and Organic Sugar) under HS Codes 1701 14 90 and 17019990. This extension goes beyond October 31, 2023, and will remain in effect until further orders.
3. Consumer-Centric Approach: The Indian government’s steadfast commitment to its 140 crore domestic consumers is evident. Despite the global surge in sugar prices to a 12-year high, India continues to offer some of the most affordable sugar prices worldwide. The retail sugar prices have seen only a nominal increase, in line with the Fair and Remunerative Price (FRP) for sugarcane farmers. Over the last decade, the average annual inflation in retail sugar prices has been approximately 2%.
4. Enhanced Monitoring: The government has also implemented rigorous monitoring of monthly sugar dispatches from mills to ensure sufficient availability in the domestic market. Additionally, it has mandated that all stakeholders, including traders, wholesalers, retailers, and sugar processors, disclose their sugar stock positions on a centralized portal. These measures aim to improve oversight of the sugar sector and facilitate a steady supply of sugar in the market.
5. Preventing Hoarding and Speculation: To maintain a balanced and equitable sugar market, the Government of India is resolute in its commitment to thwart hoarding and speculation. These efforts are geared towards ensuring that sugar remains affordable to consumers across the country, reinforcing the government’s dedication to creating a stable and fair market environment.
6. Promoting Ethanol Production: The sugar export policy also aligns with India’s ambitions to produce ethanol from sugar-based feedstocks. In the Economic Survey Year (ESY) 2022-23, India diverted approximately 43 Lakh Metric Tonnes (LMT) of sugar for ethanol production. This strategic move is expected to generate revenue of about ₹ 24,000 crores for sugar-based distilleries, thereby facilitating timely payment of cane dues to farmers and bolstering the self-sufficiency of the sugar sector.
7. Cane Dues Clearance: Through appropriate government policies related to sugarcane and sugar, sugar mills have paid approximately ₹ 1.09 lakh crores, clearing over 95% of cane dues for Sugar Season 2022-23. The government is making concerted efforts to clear the remaining dues promptly, resulting in cane dues reaching historically low levels.
8. Domestic Price Control: In pursuit of maintaining domestic food security and stabilizing domestic prices, the Indian government has implemented several proactive measures concerning the export of rice.
9. Prohibition on Broken Rice Export: The export of broken rice was prohibited, and an export duty of 20% was levied on non-basmati white rice on September 9, 2022.
10. Extension of Export Duty: On August 25, 2023, the government extended the export duty of 20% on parboiled rice until March 31, 2024. This duty aims to restrain price increases of this essential staple and ensure ample availability in the domestic market. Consequently, there has been a notable decrease of 65.50% in quantity and 56.29% in value concerning parboiled rice exports.
11. Strict Customs Checks: To prevent the export of other varieties of rice under the guise of parboiled rice, customs authorities have been instructed to perform stricter essential checks.
12. Relaxation for Specific Countries: While non-basmati white rice exports are prohibited, the Indian government has taken a nuanced approach by allowing exports to specific countries. These countries, including Nepal, Cameroon, Malaysia, the Philippines, Seychelles, Côte d’Ivoire, the Republic of Guinea, UAE, Bhutan, Singapore, and Mauritius, have been allocated specific quantities for rice exports. This approach ensures a measured balance between domestic food security and international commitments.

Conclusion

The Indian government’s dedication to both farmers and consumers is unmistakable in its efforts to stabilize essential food commodity prices. Through strategic measures in the sugar and rice sectors, the government ensures not only affordability but also accessibility to these vital commodities. This commitment to striking a balance between domestic interests and global commitments is essential for fostering a sustainable and prosperous agricultural sector, ensuring food security, and enhancing the welfare of the Indian populace. As the festive season unfolds, these measures serve as a testament to the government’s unwavering support for the nation’s agricultural community and its dedication to the welfare of all consumers.