Problems of Food Storage in India

no picture Santnam Bakshi_GEMConnect_Chennai_India
Member since January 31, 2014
  • 3 Posts

The Food Corporation of India which is responsible for implementing the Public Distribution System Scheme faces immense problems regarding its storage facilities.

The problem can be divided into two parts:

1) Wastage of Food due to poor storage facilities

2) Wastage of money due to lack of storage facilities

1a) One of the reasons for the wastage of food is that grains are not moved out of the warehouses in time and distributed. Due to this inefficiency in transporting grains out of the warehouses and to the ration shops, massive quantities of grains pertaining to years 2008-09 were found in the FCI godowns in March 2012. This storage of old crops has led to considerable depreciation in the quality of food grains. Due to this problem, 1.06 Lac tonnes of wheat under the custody of State Government Agencies in Haryana and Punjab was damaged. If we assume a family needs 30Kg of wheat for a month, this quantity of wheat would have fed 1 lakh families for 3 years.

1b) The Food Corporation of India owns a storage capacity of about 156 lac tonnes including the storage space hired by it. The total storage capacity comes to about 336.04 lac tonnes. However, the Stock of Food grains procured in the year 2011-12 was 667.89 lac tonnes, leading to severe strain on the FCI storage facilities. This led to the use of Stage Government Agencies for the storage of grains and the use of extremely poor storage facilities- such as storing grains in the open, susceptible to damage due to rain, floods and rat infestation. In the Bani Centre alone of the Haryana Warehousing Corporation, during the period of 2008-11, 5128.45 Tonnes of wheat were damaged due to unprecedented floods. Moreover the total loss of food grains in Punjab and Haryana, over this period of time reached to 32,772 Tonnes, amounting to a loss of Rs 42.14 Crores to the Food Corporation of India.

1c) Two of the most disturbing problems in this situation are the inefficiency of the FCI to use available storage space and to get rid of the damaged food grains to make space for the procured grains. It was found that despite the storage constraints in FCI, the utilization of existing storage capacity in various states and Union territories was less than 75% in majority of the months, during the period of 2006-12. Due to the lack of proper maintenance and skilled staff, 3.12 lac tonnes of storage capacity in the form of silos was lying unutilized. Silos at Mayapuri, Delhi of 21000 tonnes capacity were lying unutilized due to non-installation of Thermocouple and Hygrometer. The failure to ensure the early disposal of damaged crops in warehouses in Punjab due to delays in getting the approval from the FCI to dispose of these crops led to losses and 9000 tonnes of storage space blocked by the damaged crops. In simple words, the above paragraph talks about, how we face lack of storage facilities, as we don’t even use all the storage facilities available to us.

2a) Loss of money is incurred due to the damage of crops. In total, the worth of the crops damaged in Punjab and Haryana was worth about 160Crore rupees. The largest drain on the money of the FCI has been on hiring storage space. Due to a substantial increase in the procurement of food grains for various schemes such as the PDS, AAY etc and the owned storage capacity of the FCI remaining constant, there has been a considerable increase in the hiring charges of the FCI. The money spent on hiring charges by the FCI has increased from 321.51 Crore in 2006-07 to 1119.03 crores in 2011-12. This figure is expected to increase even more after the implementation of the Food Security Bill. This expenditure can be decreased if all the storage available with the FCI is used efficiently.

2b) The last but not the least depressing problem, is the money paid by the FCI on carry over charges to the State Government Agencies. According to the state government agencies, the FCI faces shortages if the grains are not taken over by the FCI before the 30th of June each year. The FCI has to pay carry over charges to the agencies until the grains are lifted off by the FCI. The money spent by the FCI on carry over charges in 2006-07 was 175 crores, but has been on the rise since then. In 2010-11 the FCI paid a record sum of Rs 1981 Crores as carry over charges to the State Government agencies. The FCI also had to incur avoidable expenditures of Rs 375 crores in Punjab and Haryana in the form of carryover charges, due to failure in utilizing the storage space available in the regional offices of the FCI in Punjab and Haryana.

The Above mentioned problems of Food Storage in India can summarized as:

1) There is enough food in India to feed everyone, but wastage of large amounts of food prevents this from happening.

2) Considerable amount of Tax-Payers money is wasted due to carelessness and irresponsibility of the FCI officials. This wastage of money leads to an increase in the fiscal deficits of the country. The increase in fiscal deficits contributes to inflation.

The only way to solve this problem would be major reforms in the functioning of the Food Corporation of India, and making officials responsible for grains wasted and money lost. As individuals we can show our support to solve this problem by writing articles about it in the newspaper, making more people aware of the problem and approaching our local leader and maybe even using the help of election candidates in tackling the problem. A detailed documentary of this situation can force the government to take some action.

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