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Prices of Essential Food Commodities to Remain Stable During Festival Season

These measures by the Indian government are a testament to its commitment to stabilizing food prices during the festival season and ensuring the availability of essential food commodities for its citizens.

Shivam Dwivedi
Prices of Essential Food Commodities to Remain Stable During Festival Season (Photo Source: Pexels)
Prices of Essential Food Commodities to Remain Stable During Festival Season (Photo Source: Pexels)

In a significant move to provide stability in food prices and ensure the well-being of Indian consumers, the Secretary of the Department of Food and Public Distribution, Sanjeev Chopra, recently announced a series of measures that will keep the prices of essential food commodities stable throughout the festival season.

Sugar Sector

One of the key steps taken by the Indian government to maintain price stability is the continued restriction on sugar exports. The decision to prolong these restrictions, as detailed in the DGFT's notification No. 36/2023 dated 18 Oct 2023, extends the ban on sugar exports beyond the initial October 31, 2023 deadline until further notice. This move has a dual purpose: ensuring ample sugar availability for domestic consumers at affordable prices and supporting the country's efforts in the Ethanol Blended with Petrol (EBP) Program.

The government's commitment to prioritize the interests of its 140 crore domestic consumers is evident in its policies. Despite the current 12-year high in international sugar prices, India continues to offer some of the world's most reasonably priced sugar. The retail sugar prices in the country have seen only nominal increases, in alignment with the Fair and Remunerative Price (FRP) of sugarcane for farmers. Over the last decade, the average annual inflation in retail sugar prices has been approximately 2%.

To further ensure the availability of sugar in the domestic market, the government is closely monitoring the monthly dispatches of sugar mills. Additionally, all traders, wholesalers, retailers, big chain retailers, and sugar processors are mandated to report their sugar stock positions, which will help the government monitor sugar stocks across the nation. These measures are aimed at promoting better oversight of the sugar sector and ensuring an adequate supply of sugar in the market.

The government's dedication to preventing hoarding and speculation in the sugar market underscores its commitment to maintaining a balanced and equitable market environment, where sugar remains affordable for all consumers.

The sugar export policy also supports the production of ethanol from sugar-based feedstocks. In the Energy Year 2022-23, India directed around 43 LMT (lakh metric tonnes) of sugar towards ethanol production, generating an expected revenue of Rs 24,000 crores for sugar-based distilleries. This revenue has played a crucial role in helping the sugar industry clear the dues owed to farmers promptly, making the sugar sector more self-sufficient.

Due to appropriate government policies on sugarcane and sugar, sugar mills have paid about Rs 1.09 lakh crores and cleared over 95% of cane dues for the Sugar Season 2022-23. Efforts are ongoing to clear the remaining dues as well.

Rice Sector

To safeguard domestic food security and maintain affordable prices for essential food items, the Indian government has implemented various measures in the rice sector. Notably, the export of broken rice was prohibited, and a 20% export duty was imposed on non-basmati white rice on September 9, 2022. Subsequently, the export of non-basmati white rice was also prohibited on July 20, 2023.

In the fiscal year 2022-23, India exported 17.8 million tonnes of non-basmati rice and 4.6 million tonnes of basmati rice. Out of the non-basmati rice exports, around 7.8-8 million tonnes consisted of parboiled rice. From August 25, 2023, a 20% export duty was imposed on parboiled rice, initially until October 15, 2023, and now extended until March 31, 2024. This move aims to control the price rise of parboiled rice, a staple food, and maintain its adequate availability in the domestic market. As a result, there has been a significant decline in the export of parboiled rice.

To provide relief while ensuring compliance with export restrictions, the government has decided to relax restrictions on the export of specific quantities of non-basmati white rice to certain countries. These countries include Nepal, Cameroon, Malaysia, the Philippines, Seychelles, Ivory Coast, the Republic of Guinea, the UAE, Bhutan, Singapore, and Mauritius.

By extending restrictions on sugar and rice exports and closely monitoring these sectors, the government is taking proactive steps to maintain food security and affordability for its people.

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