Procurement in details
Procurement - An Introduction
|The Govt. policy of procurement of Food grains has the broad objectives of ensuring MSP to the farmers and also ensuring availability of food grains to the weaker sections at affordable prices. It also ensures effective market intervention thereby keeping the prices under check and also adding to the overall food security of the country.
|FCI, the nodal central agency of GOI, along with other State Agencies undertakes procurement of wheat, paddy and coarse grains under price support scheme and rice under statutory levy scheme. The procurement under Price Support is taken up mainly to ensure remunerative prices to the farmers for their produce which works as an incentive for achieving better production.
|Before the harvest during each Rabi / Kharif Crop season, the Govt. of India announces the minimum support prices (MSP) for procurement on the basis of the recommendation of the Commission of Agricultural Costs and Prices (CACP) which along with other factors, takes into consideration the cost of various agricultural inputs and the reasonable margin for the farmers for their produce.
|To facilitate procurement of food grains, FCI and various State Agencies in consultation with the State Govt. establish a large number of purchase centres at various mandis and key points. The number of centres and their locations are decided by the State Governments, based on various parameters, so as to maximize the MSP operations. For instance for procuring Wheat & Rice, more than 14000 procurement centres were operated for each crop during 2009-10. Such extensive & effective price support operations have resulted in sustaining the income of farmers over a period and in providing the required impetus for higher investment in agriculture sector for improved productivity.
|Whatever stocks which are brought to the Purchase centres falling within the Govt. of Indias specifications are purchased at the fixed support price. If the farmers get prices better than the support price from other buyers such as traders / millers etc., the farmers are free to sell their produce to them. FCI and the State Govt./its agencies ensure that the farmers are not compelled to sell their produce below support price.|