Pacs: Cabinet approves a mega plan of Rs 1 lakh crore to create grain storage capacity in cooperative sector – Times of India

NEW DELHI: The Cabinet on Wednesday approved a Rs 1 lakh crore plan to create the world’s largest grain storage capacity in India in the cooperative sector through convergence of various existing schemes of the ministries of agriculture, food and public distribution and food processing industries. The plan would be implemented by utilizing the available outlays provided under certain identified schemes of all these ministries.
The move will help reduce crop damage and prevent distress sale by farmers, besides strengthening the country’s food security and creating job opportunities in rural India.
Under the plan, facilitated by an inter-ministerial committee (IMC), the government will create 700 lakh tonnes of grain storage capacity in the cooperative sector over the next five years. The Cabinet also approved setting up IMC.
Calling it a “visionary decision” which will lay the foundation of a prosperous, self-reliant and food grains-rich India, Union home and cooperation minister Amit Shah said lack of agricultural storage capacity leads to wastage of food-grains and farmers are forced to sell their crops at low prices. With this decision, farmers will now get modern grain storage facilities in their blocks through Primary Agricultural Credit Societies (PACS), so that they will be able to get fair prices for their grains, he added.
Information and broadcasting minister Anurag Singh Thakur while addressing media on the cabinet decision said the programme will start “with an expenditure of around Rs 1 lakh crore”. A godown of 2,000 tonne capacity will be established in each block, he added.
The minister noted that the country’s foodgrains production is currently around 3,100 lakh tonne, while the storage capacity is only about nearly 47% (1,450 lakh tonnes) of the total output. Adding 700 lakh tonne storage capacity will take the total capacity to 2,150 lakh tonne, he added.
The multi-pronged plans aims to address not just the shortage of agricultural storage infrastructure in the country by facilitating establishment of godowns at the level of selected viable PACS, but also enable PACS to undertake various other activities such as functioning as procurement centres for state agencies/ Food Corporation of India (FCI), serving as Fair Price Shops (FPS) and setting up custom hiring centers and common processing units.
“Creation and modernization of infrastructure at the level of PACS will reduce food-grain wastage by creating sufficient storage capacity, strengthen food security of the country and enable farmers to realise better prices for their crops,” said a statement of the ministry of cooperation on the Cabinet decision.
The IMC will be constituted under the chairmanship of Shah with agriculture, food and public distribution and food processing industries ministers, and secretaries concerned as members.
In order to ensure time bound and uniform implementation of the plan in a professional manner, the ministry of cooperation will first implement a pilot project in at least 10 selected districts of different states/ UTs. “The Pilot would provide valuable insights into the various regional requirements of the project, the learnings from which will be suitably incorporated for the country-wide implementation of the plan,” said the ministry.
Though there are more than 1,00,000 PACS in the country with a huge member base of more than 13 crore farmers, only 63,000 of them are functional. Setting up decentralized storage capacity at the level of PACS along with other agri infrastructure is expected to enable these primary credit societies to transform themselves into vibrant economic entities.
Once the grain storage capacity is increased as per the plan, farmers will be able sell their crops to PACS by receiving some advance payment at the Minimum Support Price (MSP), and get the balance after the PACS sell the food grains in the market.
Alternatively, farmers can store their crops in the warehouses managed by PACS and get finance for the next crop cycle and sell their crops at the time of their choice, or they can sell their entire crop to PACS at MSP.
Flagging benefits of the plan, Shah said that PACS are an important pillar of the rural economy, and with this plan, the country will get food security and crores of farmers associated with cooperatives will be benefited.