The proposal relating to decentralised procurement has been aimed at providing an enlarged role for the state governments and enhancing efficiency gains. However, the government has shown no intentions to impose a new system on the states without their consent.

This was recently stated by the Ministry of Finance, Government of India. The department has clarified that the present arrangement would continue in states which are unable or unwilling to implement the decentralised system. The responsibility of the centre would not be diluted in these areas and the central government would not withdraw from procurement against the wishes of the state. It is worth mentioning here that states of West Bengal, Uttar Pradesh and Madhya Pradesh have already implemented a decentralised system of procurement with encouraging results and a saving of Rs 141.36 crore in the year 2000-01. For the states who desire to take up procurement operations through their own machinery, the details and modalities would be worked out by the particular ministry.

The finance ministry has notified that in order to make the concept of Minimum Support Prices (MSP) a reality to all farmers everywhere in the country, it was necessary to encourage states to take up procurement operations. The government wants to ensure that the farmers receive at least the MSP for their produce through an appropriate system. It has already been decided that the detailed scheme would be worked out in consultation with the state government to share the efficiency gain of de-centralised procurement operations while ensuring an effective price support mechanism to all farmers.

The proposal for establishing grain banks has been supported by most of the states. It is being felt that this would be particularly useful in areas with scattered population and especially in tribal areas. A detailed scheme will be prepared taking into account the experience of Madhya Pradesh and other states.

There is also emerging a unanimous decision that restrictions on movement of agricultural commodities be removed so that a single trade zone may be created. The various controls and regulations being implemented in the states are required to be reviewed so that they could be progressively dismantled.

Nitish Kumar, the agriculture minister, has stated that a significant shift is needed in our food management policy in order to bring it in line with present realities. He said that the existing Food Management System is primarily directed at mopping up the surplusses of the north-western region, which is the main beneficiary of the green revolution. As other regions too have begun to generate surpluses, farmers in those areas should not be denied fair and equitable remuneration for their efforts. Besides, there are attempts to increase the sanction of assistance for increasing storage capacity to Punjab by 34 lakh tonnes, to Haryana 10 lakh tonnes and to Andhra Pradesh 5 lakh tonnes.

The proposal for decentralisation of procurement operations has evoked mixed reactions from the states. While states with marginal or emerging surplusses are in favour of the proposal in principle, surplus states insisted that the present system of procurement through the FCI should continue. States deficient in foodgrains too have expressed reservations about modifications to the present system.