Punjab likely to suffer ₹600-cr revenue loss
Sudden heatwave has resulted in dip in overall yield, say officials; purchase by pvt traders has also contributed to low procurement by state agencies
CHANDIGARH: The Punjab government is staring at a revenue loss of up to 600 crore against accruals on wheat procurement following a “big” yield loss that has led to a sharp fall in the purchase of the foodgrain by state agencies.
The state government has set a target of procuring 135 lakh tonnes of wheat this season.
“We are expecting to wind-up procurement at 90-100 lakh tonnes, a shortfall of 35-45 lakh tonnes, and it means a straight revenue loss of Rs. 500 to Rs. 600 crore which is a huge amount, if we consider state’s dependence on the crop sale revenue particularly when it is passing through acute fiscal crunch,” said a senior officer of the state food and civil supplies department on condition of anonymity.
The state government charges 3% each as rural development fund (RDF) and mandi fee on sale of the produce to food corporation of India (FCI). It comes out to a tentative Rs. 1,776 crore on the total estimated value of the procurement which was pegged at Rs. 29,600 crore at the onset of the procurement that started on April 1.
“Both, loss of quality which includes shriveled grain higher than the permissible limits and overall yield fall due to sudden
The state government is not likely to meet its target of procuring 135 lakh tonnes of wheat this season.
Total arrivals so far
Thursday's arrival Total purchase so far Purchase by private traders
heat wave is a big loss,” said Ravi Bhagat, secretary mandi board, that collects the taxes.
“The board has around 70,000 kilometers of rural roads to be maintained. We make new roads also, and there are many other things which are serviced from the tax generation from the RDF and mandi fee such as funding of smart schools, supporting the villages dispensaries, and maintenance and modernisation of
mandis. Fall in revenue will adversely impact these works,” he added.
Four state procurement agencies – Punsup, Pungrain, Markfed and state warehousing corporation procures on behalf of the Centre and hand over the produce to FCI for further distribution to the consuming states under public distribution system. As per crop cutting experiments conducted by the state agriculture department, there is an average fall of five quintals per hectare - from 48.68 quintals in the last season to 43.72 quintals in the current wheat harvest as depicted in the results of 1,200 tests reports so far (out of 2,238 samples taken).
“This is a big (yield) loss. Exact picture will be known when all experiment reports will come but for sure we are going to suffer heavily,” said director, agriculture, Gurvinder Singh.
Also, purchase of wheat by private traders, which has crossed an eight years high and is expected to touch 10 lakh tonnes, is also one of the factors contributing to the low procurement by state agencies.
The private purchase by traders through mandis will come with revenue generation. However, as per the reports, a large number of traders are buying directly from the farmers.
The state government has issued a warning that incase any such trader is caught, a penalty of ten times of the applicable taxes will be imposed.