Sugary Woes

As New Delhi changes norms for procurement and distribution of sugar across India, J&K government is still indecisive about the Rs 300 crore “business”. The crisis could bruise the credibility of the coalition further as month of fasting and Amarnath yatra traditionally add to sugar appetite, RS GULL reports.


Consumer Affairs and Public Distribution (CAPD) department offers rations to three categories of population; those falling over extreme poverty line covered under Antodaya Anna Yojana (AAY), the below poverty line (BPL) and above poverty line (ABL). All the three categories of population have different rates for the rations they take home every month, but there is only commodity that is sold at the same rate for all the three of rationed: the sugar.

Kashmir has traditionally remained a food deficit state. Off late, as the sprawling green fields were converted into apple orchards and housing colonies, the deficit has significantly increased. While the market is taking care of a section of the population, it is CAPD that is making rations available. It has two different types of outlets that exist across the state and the items it offers include rice, flour, wheat, sugar and kerosene. Protecting consumer rights is also the major activity of CAPD, besides assuring the people use weights and measures properly.

Managing supplies of the rations has evolved over the years. At one point of time, peasantry within the state would sell part of their produce to the government which would be processed to feed the city. Termed Khush-Khareed (purchased happily), it was a slight improvement over the pre-partition practice in which the Maharaja troops would come and take most of the harvest as the state share. Various political leaders had to launch a crusade against the practice asserting that the peasantry is short of its own requirements and forcing them to spare part of the produce was unjust.

It was abolished only after the state government made New Delhi to agree that it will provide the rations. Later, Food Corporation of India (FCI) came to the scene. The practice is that the state government has allocations on basis of the population and it lifts the quantities from FCI on monthly basis. FCI has a huge infrastructure across the state that enables CAPD to manage the distribution.

Off late, there is a change. The central government decided that from June 1, 2013, no state across India will be permitted to lift any sugar from the FCI. The alternative is that the states would make their purchases from open market. They will supply the sugar to consumers at Rs 13.50, a kilogram and the central government will reimburse them Rs 18.50 of subsidy for every kilogram they distribute. Though the plan was announced quite early, J&K state took it lightly. With stocks barely for 15 days, J&K government is desperately working on two fronts to save the face.

“We have taken up the issue at the highest level with the central government with the plea that J&K, unlike other states, lacks any sugar related industry and the transportation is a huge crisis,” CAPD minister Choudhary M Ramzan said. “Creating facilities apart, we have suggested them that if they can not retain the traditional system, they should give us adequate time to create the required infrastructure.”

There has not been any formal response. Right now, however, the government is desperate to manage its requirements because the Muslim month of fasting is round the corner and so is the Amarnath yatra. The sugar consumption shoots up on these occasions.

J&K government has already sent a high level delegation to the sugar producing states with the main task to explore the possibility of having some ready-to-adopt system on emergency basis in case the central government did not agree to offer concessions to the state. “There are positive responses from certain quarters in the open market in Haryana but it will add to a loss of three to four rupees per kilogram,” Choudhary asserted. Under the new system, CAPD is supposed to offer sugar per kg at Rs 13 and the central government will reimburse Rs 31 per kg. “But the crisis is that the open market rates are at around Rs 35 per kg which means a lot of loss.” Transporting the supplies to Kashmir may add to it eventually.

Under the existing set up, J&K supply food grains and sugar to more than 19 lakh families. The overall yearly requirement of sugar is 83544 metric tons of which 45852 mts are consumed in Kashmir and Ladakh and the balance 37852 Mts are consumed in Jammu. “We require 90 truck loads of sugar a day,” Choudhary said, adding, “Given the road connectivity between Srinagar and Jammu, it is a problem for storing stocks because we lack facilities and most of the storage facilities within the state are owned by FCI.”

J&K has 156 CAPD and 18 FCI storage facilities of which Kashmir valley has 95 CAPD (62614 metric tons) and 9 FCI (58340 metric tons). North Eastern states have also requested the central government not to disturb the existing mechanism for logistical reasons. These states have been arguing that a subsidy of Rs 18.50 (including all administrative, transportation, distribution and other expenses) is insufficient as sugar prices are between Rs 35 to Rs 45 per kg in the retail market.

Many people see it interesting that sugar is an order worth Rs 300 crore and Omar Abdullah government is unable to find suppliers.

The panic is so visible that it can be read from the faces of some of the “very important” employees of CAPD. Visibly, they have taken poor man’s problem so seriously that they are thinking of protesting against the delayed decision making. While the efficiency of this policy shift might raise questions in the state, insiders believe the state may have to end up spending more for ensuring that whatever is decided, happens. It is not ruled out that instead of truckloads of sugar, only car-loads of bills might move to Srinagar!


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