Policy

Cabinet extends PMGKAY by 4 more months

Our Bureau New Delhi | Updated on November 24, 2021

This would entail an expenditure of ₹53,344 crore

The Cabinet on Wednesday extended the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) – free of cost food grains distribution through the ration shops – by another four months until March 31, entailing an expenditure of ₹53,344 crore. The move, which comes close after Uttar Pradesh Chief Minister’s announcement to continue the scheme, is seen as an effort to continue the goodwill in rural area till next Assembly polls slated in five States, including UP, early next year.

The Centre had launched PMGKAY scheme in April last year, which continued for eight months, to ease the hardships faced by the poor due to economic disruptions caused by the Covid pandemic. The scheme was re-launched this fiscal from May and was valid till November 30.

“It is a good use of excessive stocks in the central pool and it will also address, to some extent, the distress caused by the pandemic, loss of employment and income especially in the informal sector,” said Siraj Hussain, former Union Agriculture Secretary. Of the 8 crore workers in informal sector registered on e-shram portal, about 92 per cent have a monthly income of less than ₹10,000, Hussain said adding this section will be benefitted. The Central Pool has currently 61.6 million tonnes (mt) of rice and wheat stock.

Under PMGKAY, 80 crore beneficiaries covered through the National Food Security Act (NFSA) are eligible to avail free of cost additional foodgrains of same quantity they are entitled under the law. The NFSA beneficiaries are provided 5 kg of rice or wheat every month at highly subsidised prices of ₹3/kg (rice) and ₹2/kg (wheat). Some poorest of the poor under the Antyodaya Anna Yojana (AAY) also get 35 kg per family per month even if they have less than 7 members in each family.

Total food subsidy

The total food subsidy on account of PMGAY since its launch has been estimated at about ₹2.60 lakh crore, information and broadcasting minister Anurag Thakur said after the cabinet meeting. So far, the government has incurred ₹1.87 lakh crore on account of PMGKAY since April 2020.

Of the 60 mt of foodgrains allocated under PMGKAY between April 2020 and November 2021, States have lifted 57.1 mt (95.2 per cent) and distributed 54.1 mt (90.2 per cent), Union Food Secretary Sudhanshu Pandey said. The rice and wheat allocation is at 55:45 ratio.

“This is good for the people as the government wants to continue the support when they are in a state of recovery,” Pandey said. Food Ministry officials said that there was no “direct request” came from any State for the extension of the scheme beyond November.

On the occasion of 'Deepotsava' celebrations in Ayodhya early this month, UP Chief Minister Yogi Adityanath had announced that PMGKAY) would be extended till Holi. He had also said that not only rice and wheat, but pulses, salt and edible oil would also be distributed. It would have been difficult to implement the free foodgrains scheme on its own for UP as the entire costs would have fallen on its shoulder.

If any State which distributes free foodgrains, just waive off the selling prices of rice and wheat at ration shops whereas the Centre bears the entire difference between economic costs and selling prices, Pandey said. Based on the current difference between the two prices, the Centre bears about ₹23.48/kg subsidy on wheat and ₹33.46/kg on rice. The monthly offtake under NFSA is about 1.9 mt of wheat and 2.3 mt rice.

Published on November 24, 2021

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