With prospects for pulses crop not looking too bright, the Government has to control prices by improving supplies through imports.

When the world’s largest producer, consumer and importer of pulses faces deficient rainfall and crop prospects do not look bright, the market immediately takes notice. Fortunately for India, world pulses prices have edged just a tad higher, except for pigeon pea (tur/arhar) whose rates have risen by a fifth because of tight supplies. Though the acreage for pulses has increased by 13 per cent to 79 lakh hectares for the ongoing kharif season, there is no guarantee that the output will go up proportionately because of the erratic rains and delays in planting. Even assuming an output of 50-52 lakh tonnes (versus 48 lakh tonnes in kharif 2008) the country is sure to face chronic shortage of the protein-rich legumes, mainly tur, urad and moong. Rabi season prospects would depend almost entirely on soil moisture conditions. Relative prices of wheat, rapeseed/mustard and pulses, and expectations of farmers will determine acreage for rabi crops.

Be that as it may, for the Government, the immediate task is to improve supplies and contain prices. While imports through the private sector will continue, pubic sector enterprises will have to play a more proactive role in augmenting supplies. India may need to import about 30 lakh tonnes of pulses in 2009-10. The public sector enterprises need a well-defined roadmap for purchases, inventory and marketing. A centralised planning cell would help them take trading decisions quickly and in a co-ordinated manner. Indeed, public sector enterprises should be asked to work on a no-profit basis rather than compete with the private sector for commercial gains primarily because they have to discharge a social responsibility. At the ports, phyto-sanitary clearances have to be expedited through better coordination with Customs and port officials.

At this point of time, when the crop is getting ready and is known to be not in a great shape, there is little the Government can do except allow markets to function without hiccups. Supply of pulses through the public distribution system is sure to bring some relief to consumers. A procurement program on lines of rice and wheat may be considered. Beyond the upcoming kharif harvest, States will have to begin to plan for the rabi season making sure adequate quantities of seeds, fertilisers and other inputs are available. There is a wide difference between farm-gate and retail prices, and yet the Government has so far done little to strengthen the supply chain. The distributive trade with many layers of intermediaries needs pruning, and the use of technology (e-commerce) cannot but help. The Green Revolution bypassed pulses. It is time this nutritious group of crops received adequate policy attention.

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(This article was published in the Business Line print edition dated August 21, 2009)
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