Lok Sabha Question No. 2804 (UNSTARRED), answered on 2018-03-13
Subject: Extending of subsidy to Tamil Nadu
Ministry: CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
Asked by: V. SATHYABAMA, PR. SENTHILNATHAN, R.K. BHARATHI MOHAN, KRISHNAN NARAYANASAMY RAMACHANDRAN

## GOVERNMENT OF INDIA

## MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION

## DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION

## LOK SABHA

UNSTARRED QUESTION NO. 2804

TO BE ANSWERED ON 13 TH  MARCH, 2018

## EXTENDING OF SUBSIDY TO TAMIL NADU

2804.

SHRIMATI V. SATHYA BAMA: SHRI PR. SENTHIL NATHAN: SHRI BHARATHI MOHAN R.K.: SHRI K.N. RAMACHANDRAN:

Will the Minister of CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION miHkksDrk ekeys] [kk| vkSj lkoZtfud forj.k ea=h be pleased to state:

- (a) whether the Union Government is in receipt of any request from the State Government of Tamil Nadu to extend the coverage of subsidized wheat, edible oil, kerosene, rice and pulses to all priority households and to enhance the subsidy given to these essential food items;
- (b) if  so,  the  details  thereof and the details of supply provided monthly and subsidy provided per kgs/unit of each;
- (c) whether it is a fact that the subsidy rates were fixed long back and was not increased for a long time till date;
- (d)
- if so, the details thereof and the reasons therefor; and
- (e) the  measures  taken  by  the  Government  to  increase  the  supply  of these essential food items and kerosene to Tamil Nadu and also enhance the subsidy given on them?

## A N S W E R

MINISTER OF STATE FOR  CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION (SHRI C. R. CHAUDHARY)

- (a) to (e) : Coverage under the National Food Security Act, 2013 (NFSA), for receiving  highly  subsidized  foodgrains  is  under  two  categories,  namely, households  covered  under  the  Antyodaya  Anna  Yojana  (AAY)  and  priority households.  Accordingly,  for  the  AAY  and  priority  households  identified  by the Government of Tamil Nadu, within the coverage determined for the State, monthly  193.22  thousand  tons  of  rice  and  8.89  thousand  tons  of  wheat  is being  allocated  for  eligible  households  at  Rs.3/2  per  kg  for  rice/wheat.  In addition, 99.77 thousand tons of rice and 4.59 thousand tons of wheat is also being allocated, @ Rs.8.30/6.10 per kg for rice/wheat, to Tamil Nadu as 'tide over'  allocation  to  protect  their  average  annual  offtake  under  erstwhile Targeted Public Distribution System (TPDS), as per provisions of NFSA.

The  difference  between  the  Economic  Cost  of  foodgrains  and  the subsidized  prices  under  NFSA  is  borne  by  the  Central  Government  as  food subsidy. With the increase in Minimum Support Price (MSP) of foodgrains and corresponding increase in the cost of procurement incidentals, the economic cost  of  foodgrains  gets  increased,  resulting  in  increase  in  per  unit  food subsidy also. At the current level of Economic Cost, the per unit subsidy for allocation  of  foodgrains  out  of  Central  pool  stocks  for  eligible  AAY  and priority  households, is Rs.29.94 per kg for rice and Rs.21.96 for wheat. For tide  over  allocation,  the  per  unit  subsidy  is  Rs.24.64  per  kg  for  rice  and Rs.17.86 per kg for wheat.

As regards pulses, the stock available in the buffer is being utilized inter-alia for supply to States for distribution through their schemes. During 2016-17,  2587  MT  of  Tur  and  2623  MT  of  Urad  was  released  to  State Government of Tamil Nadu.

Allocation  of  kerosene  is  made  by  Government  of  India  to  various States/UTs,  including  Tamil  Nadu,  for  cooking  and  lighting  purpose  on quarterly basis. Further distribution of PDS Kerosene within the States/UTs under PDS network to various categories of ration card holders/ consumers is made by the concerned States/UTs. Scale and criteria of distribution are also decided by respective States/UTs. Average subsidy per liter on PDS kerosene and  allocation  of  PDS  Kerosene  made  to  the  State  of  Tamil  Nadu  are  as under:

| Year    |   Quantity of Kerosene allocated (in kL) |   Average Subsidy (Rupee per litre) |
|---------|------------------------------------------|-------------------------------------|
| 2015-16 |                                   341724 |                               13.47 |
| 2016-17 |                                   307560 |                               11.39 |
| 2017-18 |                                   204528 |                                8.79 |

As regards sugar under PDS, the Government has reviewed the sugar subsidy  scheme  in  May  2017  and  has  decided  to  continue  it  only  for  AAY families across all States/UTs, as households under AAY are covered under NFSA and are already identified and there is no BPL category under NFSA. Under  the  scheme,  Central  Government  reimburses  a  fixed  subsidy  of  Rs. 18.50 per kg @ 1 kg per month per AAY family to participating States/ UTs. The  States/UTs  are  also  allowed  either  to  absorb  the  additional  cost  on account of handling, transportation and dealer's commission or pass it on to the consumer by adding it to the Retail Issue Price (RIP) of Rs. 13.50 per kg under  PDS.  The  Government  of  Tamil  Nadu  is  participating  in  the  sugar subsidy scheme for AAY families. The annual quota of sugar for Tamilnadu for distribution in PDS for AAY families is 22375 MT.

The  State  Government  of  Tamil  Nadu  represented  to  the  Central Government in June and August, 2017 requesting to extend the coverage of subsidized sugar to all priority households, enhance the sugar subsidy from Rs.  18.50  to  at  least  Rs.  28.50  per  kg  and  assist  the  State  Government  in protecting the current scale of supply of sugar under PDS in the State. The request  of  the  State  Government  was  not  acceded  to  as  there  is  no  BPL category under NFSA. Further, States/UTs are also allowed either to absorb the  additional  cost  on  account  of  handling,  transportation  and  dealer's commission or pass it on to the consumer by adding it to the RIP of Rs.13.50 per kg PDS.

To ensure availability of sugar at reasonable price, duty free import of 5 lakh MT of raw sugar under Tariff Rate Quota (TRQ) was allowed through ports of different zones including 3 lakh MT from South Zone ports. Further, with a view to supplement the availability of sugar mainly in Southern India including Tamil Nadu and to stabilize sugar prices, Government allowed an additional import of 3 lakh MT of raw sugar by sugar mills/ refineries under TRQ, at 25% import duty, exclusively through southern ports of the Country.

Government of India is not implementing any scheme, at present, for distribution of edible oils at subsidized rates through PDS.

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