Lok Sabha Question No. 5143 (UNSTARRED), answered on 2018-03-27
Subject: Irregularities in Procurement and Distribution of Foodgrains
Ministry: CONSUMER AFFAIRS, FOOD AND PUBLIC DISTRIBUTION
Asked by: JAYAKUMAR JAYAVARDHAN, P.R. SUNDARAM, DHANANJAY BHIMRAO MAHADIK, SUPRIYA SADANAND SULE, HEENA VIJAYKUMAR GAVIT, VIJAYSINH MOHITE PATIL, RAJEEV SHANKARRAO SATAV

## MINISTRY OF CONSUMER AFFAIRS, FOOD & PUBLIC DISTRIBUTION

## GOVERNMENT OF INDIA DEPARTMENT OF FOOD AND PUBLIC DISTRIBUTION

## LOK SABHA

UNSTARRED QUESTION NO. 5143

TO BE ANSWERED ON 27 TH  MARCH, 2018

## IRREGULARITIES IN PROCUREMENT AND DISTRIBUTION OF FOODGRAINS

## 5143.   DR. J. JAYAVARDHAN:

SHRI P.R. SUNDARAM:

SHRI DHANANJAY MAHADIK:

SHRIMATI SUPRIYA SULE:

DR. HEENA VIJAYKUMAR GAVIT:

SHRI MOHITE PATIL VIJAYSINH SHANKARRAO:

SHRI SATAV RAJEEV:

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

- (a) the procedure laid down or adopted by the Government for procurement of foodgrains by various agencies;
- (b) the  details  of  the  foodgrains  procured  by  various  agencies  during each of the last three years and the current year, State/UT-wise;
- (c) whether there is any monitoring mechanism to check irregularities in the procurement and the distribution of foodgrains by the agencies involved for the purpose;
- (d) if  so,  the  details  thereof  indicating  the  number  of  irregularities reported therein during the said period along with the action taken thereon, agency-wise;
- (e) the  corrective  steps  taken  to  ensure  smooth  functioning  of  these agencies; and
- (f) whether the Government is encouraging the States to increase their grain  procurement  by  creating  State  agencies  and  financing  them  through bank  credit  and  if  so,  the  details  thereof  and  the  response  of  the  States including  Maharashtra  and  Tamil  Nadu  thereto  indicating  the  number  of agencies  created  and  foodgrains  procured  by  them  during  the  last  three years, State- wise?

## A N S W E R

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

(a):  There  exists  a  transparent  &  Uniform  Policy  for  procurement  by Government agencies across the country. Under this policy, whatever wheat and paddy are offered by farmers within the stipulated procurement period, conforming to the specifications prescribed by Government of India, are

purchased  at  Minimum  Support  Price  (MSP)  by  the  Government  agencies including  Food  Corporation  of  India  (FCI),  for  central  pool.  However,  if  any producer/farmer gets better price in comparison to MSP, he is free to sell his produce in Open market.

Further, the different commodities of coarse grains are procured by State Governments as per their requirement for distribution under National Food Security Act (NFSA) as well as Other Welfare Schemes (OWS).

Before the onset of procurement season a meeting of Food Secretaries of the States is convened at the level of Ministry to decide the estimated procurement, milling period and other issues. Based on production,  expected  procurement,  marketable  surplus  in  the  catchment area, convenience of farmers and availability of other logistics / infrastructure such as storage, transportation  and milling facilities etc., the number  of  procurement  centres  to  be  opened  are  decided  mutually  by various State Governments/its procurement agencies and Food Corporation of  India  (FCI).  Large  numbers  of  temporary  purchase  centres  are  also established for the convenience of the farmers.

In order to ensure quality parameters, before the commencement of each  procurement  season,  detailed  guidelines  /procedure  for  inspection, sampling and analysis procedure to be followed in procurement of paddy and acceptance of rice stocks are circulated.

- (b): State-wise  quantum  of  wheat,  rice  and  coarse  grains  procured  by Government  agencies  during  each  of  the  last  three  years  and  the  current year is attached as Annexure-I, II and III respectively.
- (c): FCI  has  in  place  well  established  Monitoring  Mechanism  to  keep  a check on the procurement and the distribution activities undertaken by its field functionaries, details of which are attached as Annexure-IV.
- (d): During Checks/  Super  checks  at  various  levels,  some  quantity detected as Beyond Rejection Limit (BRL).  Such BRL rice stocks had been got  replaced  from  the  concerned  millers  at  their  cost,  with  sound  stocks confirming to Government of India (GOI) specifications.

Statement showing details of BRL detected during 2014-15, 2015-16, 2016-17 and 2017-18 is at Annexure-V.

(e): The Corrective Steps taken by FCI for smooth  functioning of procurement and distribution of foodgrains are attached as Annexure-VI.

(f): Government of India introduced Decentralized Procurement Scheme (DCP)  in  1997-98  to  increase  participation  of  States  in  procurement  and distribution. Under DCP system, the State Government/its agencies procure, store and distribute rice/wheat within the state under National Food Security Act  (NFSA)  and  Other  Welfare  Scheme  (OWS).  Further,  the  excess  stocks (rice & wheat) procured by the State /its agencies are handed over to FCI for the Central Pool.

As on date 15 States/UTs have adopted DCP mode for procurement of Rice (Jharkhand partially adopted). Further, 8 States have adopted DCP mode for procurement of Wheat (Rajasthan partially adopted).

Maharashtra  and  Tamil  Nadu  are  DCP  State  for  rice.  The  Central Government undertakes to meet the entire expenditure incurred by the State Governments  on  the  procurement  operations  as  per  the  approved  costing. Central Government also provide advance subsidy to State Government.

Further,  Government  of  India  is  not  financing  the  State  Agencies through bank credit.

****

## ANNEXURE-I ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (b)  OF  THE  UNSTARRED

## QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

## PROCUREMENT OF WHEAT FOR CENTRAL POOL

(Figures in LMT)

| STATE/UT         | RMS 2014-15   | RMS 2015-16   | RMS 2016-17   | RMS 2017-18   |
|------------------|---------------|---------------|---------------|---------------|
| Punjab           | 116.41        | 103.44        | 106.49        | 117.06        |
| Haryana          | 64.95         | 67.78         | 67.52         | 74.32         |
| Uttar Pradesh    | 6.28          | 22.67         | 7.97          | 36.99         |
| Uttarakhand      | 0.01          | 0.04          | 0.02          | 0.02          |
| Madhya Pradesh   | 70.94         | 73.09         | 39.92         | 67.25         |
| Gujarat          |               | 0.73          | 0.00          | 0.07          |
| Rajasthan        | 21.59         | 13            | 7.62          | 12.45         |
| Bihar            |               | 0             |               |               |
| Jharkhand        |               |               |               |               |
| Karnataka        |               |               |               |               |
| Delhi            |               | 0.02          | 0.00          |               |
| J&K              |               |               |               |               |
| Maharashtra      |               |               |               |               |
| Odisha           |               |               |               |               |
| Himachal Pradesh |               | 0.11          | 0.00          |               |
| Chandigarh       | 0.05          |               | 0.07          | 0.08          |
| West Bengal      |               |               |               |               |
| Chhattisgarh     |               |               |               |               |
| Andhra Pradesh   |               |               |               |               |
| Assam            |               |               |               |               |
| Telangana        |               |               |               |               |
| Others           |               | 0.04          |               |               |
| All IndiaTotal : | 280.23        | 280.88        | 229.62        | 308.24        |

****

## ANNEXURE-II ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (b)  OF  THE  UNSTARRED

## QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

## PROCUREMENT OF RICE FOR CENTRAL POOL

| STATE/UT          | KMS 2014-15   | KMS 2015-16   | KMS 2016-17   | KMS 2017-18#   |
|-------------------|---------------|---------------|---------------|----------------|
| A&NISLANDS        |               |               |               |                |
| ANDHRA PRADESH    | 35.96         | 43.36         | 37.24         | 26.99          |
| TELANGANA         | 35.04         | 15.79         | 35.96         | 12.23          |
| ASSAM             | 0.15          | 0.42          | 0.47          | 0.19           |
| BIHAR             | 16.14         | 12.23         | 12.34         | 6.64           |
| CHANDIGARH        | 0.10          | 0.16          | 0.13          | 0.14           |
| CHHATISGARH       | 34.23         | 34.42         | 40.22         | 32.07          |
| DELHI             | 0.00          | 0.00          | 0.00          | 0.00           |
| GUJARAT           | 0.00          | 0.01          | 0.01          | 0.01           |
| HARYANA           | 20.15         | 28.61         | 35.83         | 39.67          |
| HIMACHAL PRADESH  | 0.00          | 0.00          | 0.00          | 0.00           |
| JAMMU& KASHMIR    | 0.00          | 0.07          | 0.08          | 0.13           |
| JHARKHAND         | 0.06          | 2.06          | 1.39          | 1.12           |
| KARNATAKA         | 0.88          | 0.55          | 0.00          | 0.00           |
| KERALA            | 3.74          | 3.82          | 3.08          | 1.54           |
| MADHYA PRADESH    | 8.07          | 8.49          | 13.14         | 10.96          |
| MAHARASHTRA       | 1.99          | 2.30          | 3.09          | 1.57           |
| NAGALAND          | 0.00          | 0.00          | 0.00          | 0.00           |
| ODISHA            | 33.57         | 33.69         | 36.30         | 23.96          |
| PUDUCHERRY        | 0.00          | 0.00          | 0.00          | 0.00           |
| PUNJAB            | 77.86         | 93.50         | 110.52        | 118.33         |
| RAJASTHAN         | 0.00          | 0.00          | 0.00          | 0.00           |
| TAMIL NADU        | 10.51         | 11.92         | 1.44          | 4.40           |
| UTTAR PRADESH     | 16.98         | 29.10         | 23.54         | 28.75          |
| UTTRAKHAND        | 4.65          | 5.98          | 7.06          | 0.38           |
| WEST BENGAL       | 20.32         | 15.68         | 19.23         | 0.25           |
| OTHERS            | 0.00          | 0.00          | 0.00          | 0.00           |
| ALL INDIA TOTAL : | 320.40        | 342.18        | 381.06        | 309.30         |

# As on 22.03.2018

***

(Figures in LMT)

## ANNEXURE-III

## ANNEXURE REFERRED TO IN REPLY TO PART (b) OF THE UNSTARRED QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

## STATEMENT SHOWING PROCUREMENT OF COARSEGRAINS

| KMS      | COMMODITY   | ANDHRA PRADESH   | TELANGANA   | BIHAR   | CHANDIGARH   | HARYANA   | KARNATAKA   | MADHYA PRADESH   | MAHARASHTRA   |   RAJASTHAN TOTAL |
|----------|-------------|------------------|-------------|---------|--------------|-----------|-------------|------------------|---------------|-------------------|
| 2014 -15 | JOWAR       |                  |             |         |              |           | 6839        | 1643             | 5867          |             14349 |
| 2014 -15 | BAJRA       |                  |             |         |              |           |             |                  |               |                 0 |
| 2014 -15 | MAIZE       | 4945             | 6438        |         |              |           |             | 301842           | 1619          |            314844 |
| 2014 -15 | RAGI        |                  |             |         |              |           | 135955      |                  |               |            135955 |
| 2015 -16 | JOWAR       |                  |             |         |              |           | 7129        | 4947             | 16569         |             28645 |
| 2015 -16 | BAJRA       |                  |             |         |              | 5053      |             |                  |               |              5053 |
| 2015 -16 | MAIZE       |                  |             |         |              |           |             | 22962            | 11            |             22973 |
| 2015 -16 | RAGI        |                  |             |         |              |           | 203769      |                  |               |            203769 |
| 2016 -17 | JOWAR       |                  |             |         |              |           |             |                  | 3733          |              3733 |
| 2016 -17 | BAJRA       |                  |             |         |              | 6341      |             |                  |               |              6341 |
| 2016 -17 | MAIZE       |                  |             |         |              |           |             | 50000            | 12181         |             62181 |
| 2016 -17 | RAGI        |                  |             |         |              |           |             |                  |               |                 0 |
| 2017-18* | JOWAR       |                  |             |         |              |           |             | 264              | 2668          |              2932 |
| 2017-18* | BAJRA       |                  |             |         |              | 31347     |             | 3789             |               |             35136 |
| 2017-18* | MAIZE       |                  |             |         |              |           |             |                  | 47779         |             47779 |
| 2017-18* | RAGI        |                  |             |         |              |           |             |                  |               |                 0 |

( Figures in Tonnes )

## ANNEXURE-IV

## ANNEXURE REFERRED TO IN REPLY TO PART (c) OF THE UNSTARRED QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

Monitoring Mechanism to keep a check on the procurement and the distribution activities

## Procurement

1. Joint  inspection  of  foodgrain  stocks  undertaken  by  officials  of  FCI  &  State  Govt.  on regular intervals to check irregularities in all aspects of procurement operations.
2. Online  Procurement  Monitoring  System  (OPMS)  module  has  been  developed  to monitor  the  procurement  of  wheat  and  rice.  This  module  enables  FCI  and  DFPD  to view  and  monitor  the  consolidated  report  of  procurement  of  wheat  and  rice  done  by procuring agencies viz. State agencies and FCI.
3. An  Online  Procurement  System  as  part  of  Depot  Online  System  for  procurement  of Food Grains from farmers has been developed by FCI which ushers in transparency and convenience  to  the  farmers  through  proper  registration  and  monitoring  of  actual procurement.  Through  Depot  Online  System,  farmers  get  latest/updated  information regarding nearest purchase centre, date on which the farmer has to bring his produce to the purchase centre etc. This not only reduces the waiting period for delivery of stock by the farmers but also enable the farmer to deliver stock as per his convenience in the nearest  mandi.  MSP  is  released  through  either  electronic  mode  or  Account  payee cheque directly to the bank accounts of the farmers except in Punjab & Haryana where as per APMC Act of the state, payment is made to Arthiyas.
4. Before  the  start  of  each  procurement  season,  Govt.  of  India  prescribes  the  Uniform Specification  for  quality  of  wheat,  paddy,  rice  and  coarse  grains.  FCI/State  agencies ensure procurement of foodgrains in the mandis and at the depots strictly in accordance with quality specifications.

5. For  analysis  of  the  stocks  at  different  levels,  Quality  Control  Laboratories  are  manned  by qualified  and  trained  QC  personnel  working  at  various  levels  viz  Depot/District  /Regional/ Zonal  &Hqrs  level.  Checks/Super  checks  are  conducted  by  various  authorities  to  ensure procurement  of  stocks  as  per  prescribed  specifications.  In  addition  to  above  super  checks, squads are sent from Hqrs.,Zonal Offices & Regional Offices.

## Distribution

FCI ensures distribution of foodgrains in accordance to laid down specifications prescribed by the  Ministry  of  Consumer  Affairs,  Food  &  Public  Distribution  and  Food  Safety  and  Standards Authority of India (FSSAI). FCI releases food grains stocks to the States/UTs authorities and/or their nominees for further issue under NFSA and other welfare schemes as per the allocation formulated by the Government of India from time to time, after their satisfaction about quantity as well as quality and a certificate is also recorded to this effect.

A representative sample is drawn in the presence of the authorised representative of the state agency taking delivery of foodgrains. The Sample is divided in three equal parts and sealed. One of these jointly sealed sample bags is given to authorised representative of State Govt. taking delivery, one  is  sent  to  Area  Manager  of  FCI  and  one  is  retained  in  the  depot  from  where  the  delivery  is affected.

Further, on receipt of the quality complaint regarding foodgrains issued by FCI for distribution under  NFSA  and  other  welfare  schemes,  the  concerned  District  Collector  or  any  other  officer designated by him may call for the concerned sealed samples both from the designated state agency and  Area  Manager  of  FCI  concerned  and  get  the  sealed  samples  tested  from  a  premier  institutions. Also, in order to clear any doubts regarding quality of foodgrains issued by FCI, the Area Manager of FCI  concerned  too  may  on  his  own  initiative  take  steps  for  getting  the  samples  analysed  from  the premier institutions after getting the samples from the designated state agency.

## ANNEXURE-V ANNEXURE REFERRED TO IN REPLY TO PART (d) OF THE UNSTARRED QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

Region-Wise Quantity of stocks detected as Beyond Rejection Limit (BRL) by FCI (Financial Year-Wise)

(Fig. in MTs)

* as on 28.02.2018

# North East Frontier - Meghalaya, Mizoram and Tripura

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| Region                 |   2017-18* |   2016-17 |   2015-16 |   2014-15 |
|------------------------|------------|-----------|-----------|-----------|
| Bihar                  |       0    |       0   |       0   |         0 |
| Jharkhand              |      27    |     296   |       0   |         0 |
| Orissa                 |      27    |       0   |       0   |         0 |
| West Bengal            |       0    |       0   |       0   |         0 |
| Assam                  |       0    |       0   |       0   |         0 |
| NEF#                   |       0    |       0   |       0   |         0 |
| Arunachal Pradesh      |       0    |       0   |       0   |         0 |
| Nagaland &Manipur(N&M) |       0    |       0   |       0   |         0 |
| Delhi                  |       0    |       0   |       0   |         0 |
| Haryana                |       0    |     648   |    1029   |      1582 |
| Himachal Pradesh       |       0    |       0   |       0   |         0 |
| Jammu and Kashmir      |       0    |       0   |       0   |         0 |
| Punjab                 |     844.5  |    1432   |    3220.5 |     10215 |
| Rajasthan              |       0    |       0   |       0   |         0 |
| Uttar Pradesh          |     189    |     553.5 |     324   |       702 |
| Uttrakhand             |       0    |       0   |       0   |         0 |
| Andhra Pradesh         |       0    |     108   |     890   |       135 |
| Kerala                 |       0    |       0   |       0   |         0 |
| Karnataka              |       0    |       0   |       0   |         0 |
| Tamil Nadu             |       0    |       0   |       0   |         0 |
| Gujarat                |       0    |       0   |       0   |         0 |
| Maharashtra            |       0    |     189   |    1620   |        27 |
| Madhya Pradesh         |       0    |       0   |       0   |         0 |
| Chhattisgarh           |     162    |     162   |     783   |       162 |
| Country Total          |    1249.49 |    3388.5 |    7866.5 |     12823 |

## ANNEXURE-VI ANNEXURE REFERRED TO IN REPLY TO PART (e) OF THE UNSTARRED QUESTION NO. 5143 DUE FOR ANSWER ON 27.03.2018 IN THE LOK SABHA.

The Corrective Steps taken by FCI for smooth functioning of procurement and distribution of foodgrains are as under:

1. In  order  to  ensure  acceptance  of  rice  conforming  to  laid  down  specifications  super inspection  are  conducted  by  the  senior  officers.  Besides  10%  and  5%  samples  are drawn by District and Regional Lab to verify the quality of the stocks accepted by Technical Assistant.
2. With a view to introduce mechanized process for quality checking, 30 Computerized Rice Analyzers  (Annadarpan SMART ) developed by Centre for Development  of Advance Computing (CDAC), Kolkata were made available in 07 major procuring regions  namely  Punjab,  Haryana,  Uttar  Pradesh,  Orissa,  West  Bengal,  Chhattisgarh and Andhra Pradesh during KMS 2017-18.
3. In order to eliminate subjectivity and brief clarity in the analysis of samples of rice, a Pictorial  Depiction  of  the  refractions  in  respect  of  Uniform  specifications  of  rice based on the definition of refractions as per BIS(IS2813:1995) has been displayed in all the laboratories as well as to reduce human error in manual analysis.
4. Checks /Super checks are conducted Fortnightly , Monthly and Quaterly by Technical Assistant, Manager(QC) and Asst General Manager(QC) respectively at the time of storage of foodgrains to ensure the health of the grains is maintained all the times .
5. A drive has been launched to carry out effective prophylactic and curative treatment of stocks and regular inspections are being carried out to minimize damage to stocks.
6. Stocks are issued on First In First out (FIFO) Principle.
7. Disciplinary  action  against  the  defaulters  is  invariably  taken  who  were  found accountable for purchase of Sub-Standard Stocks.

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