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The Big Dal Soup: why Maha govt can't sell the pulses it's seized

Ashwin Aghor | Updated on: 13 February 2017, 7:16 IST

The hope

  • The Maharashtra government has seized 68,000 metric tonnes of dal being hoarded by traders
  • The public was hoping this dal would be released into the market soon, bringing down prices

The tangle

  • Legal and procedural tangles mean the dal cannot be released for about 90 days
  • State food minister Girish Bapat has given instructions to resolve this within a fortnight

More in the story

  • The 1975 amendment that could hasten the process, which no one seems to know about
  • Why sending the goods directly to fair price shops is also difficult

The super-high price of dal has caused much consternation to the common Indian.

And while the Central and state governments try to bring the prices down and reduce the burden on the people, in Maharashtra, there seems to be no end in sight to this problem. Blame it on procedural tangles.

Prices dropping across India

Governments across the land have cracked down on the hoarding and black marketing of pulses, cereals and oil seeds. In a series of raids, more than 98,000 metric tonnes of pulses have been seized.

The results have been positive. In many areas, the retail prices have come down to Rs 120-140 per kilogram.

The Central government has earmarked 20 centres under the Public Distribution System to distribute pulses at reasonable rates. And at many centres, the prices have dropped.

- In Puducherry, prices have come down from Rs 210 to Rs 170 per kg. This Rs 40 drop in the last 10 days is the maximum recorded in the country.

- In Kanpur, the prices have dropped from Rs 185 to Rs 160 per kg.

- In Ahmedabad, they've dropped by Rs 22 to Rs 138.

- In Jaipur and Purnia, prices have dropped by Rs 20 each.

But amidst all these positive trends, Maharashtra has shown a minuscule decrease of Rs 2 per kg in Nagpur, and Rs 5 per kg in Mumbai.

So what is the state doing wrong?

The 90-day problem

The Maharashtra government has, till date, seized over 68,000 metric tonnes of pulses being hoarded by traders in Thane and Navi Mumbai. However, while the public still hopes for a quick release of this stock, it has got tangled in legal threads.

A senior official at the state food and civil supplies department said: "The pulses have been seized from the traders. We will have to complete a few legal procedures before the stock can be sent to fair price shops and be sold to public."

As per the provisions of the Essential Commodities Act, the traders from whom the stock has been seized must be given proper hearing before taking any decision about disposal of the stock.

The government has already issued notices to traders for hoarding pulses. But the whole process, according to the official, will take a minimum of 90 days.

While prices drop across the country, in Maharashtra, the rates have come down by only Rs 2-5/kg

Ministerial intervention

Anticipating the delay, Girish Bapat, the state minister for food and civil supplies, has issued orders to complete the process within a week.

"The issue of rising prices was discussed in the cabinet meeting held on Wednesday. We have decided to act fast, to complete the necessary legal procedures as early as possible," Bapat said.

Traders had a meeting with Bapat and Deepak Kapoor, principal secretary of the food and civil supplies department, to discuss possible alternatives for the release of the pulses.

Bapat has ordered his officials to decide on the notices and traders' appeals within a fortnight.

The amendment no one knows about

Office-bearers of the Mumbai Consumer Forum also met Bapat and Kapoor to discuss the issue. The forum claims the entire stock seize by government can be released in the market in no time.

"As per the amendment made in the Essential Commodities Act in 1975, the district collector is empowered to fix the price of the seized stock and release it for distribution through fair price shops. We told the minister and principal secretary about it. We were surprised that no one knew about the amendment," said forum president Shirish Deshpande.

Deshpande said the government is not willing to take this step, as it will agitate the traders.

As per the existing practice, after the completion of the procedure, the pulses would be auctioned.

"The government cannot control who will buy the stock in the auction. Once sold, there will be no control on the buyer as to when, where and at what price the pulses would be sold. In that case, the entire stock will fall into the hands of another hoarder, and the government will be again helpless," Deshpande said.

"This will take a minimum of three months, and the process would be further delayed if the traders challenge the decision in court. By the time the matter gets decided in the Court, the entire stock will be rotten and rendered useless."

No end in sight

Bapat said invoking the amendment will warrant the completion of legal procedures, which would again be time consuming.

"We will definitely explore the possibility. But in the meantime, reducing the procedure time to a week from a few months would be the best solution," he said.

According to highly-placed sources in the food and civil supplies department, even the distribution of pulses to fair price shops is not an easy task.

"Even if we decide to send this stock to fair price shops, to be distributed to people below the poverty line, it will cost the government around Rs 1,300 crore. Considering the current financial condition of the state, it is not as easy as it seems," a source said.

First published: 30 October 2015, 8:39 IST
Ashwin Aghor @CatchNews

Journalist based in Mumbai.