Measures Taken by Government to Protect Consumers from Price Rise

The Government has undertaken various measures to insulate the vulnerable sections of society from price rise.

·         The central issue prices(CIP) for rice (at Rs. 5.65 per kg for below poverty line(BPL) and Rs. 3 per kg for Antodaya Anna Yojana (AAY) families) and wheat (at Rs. 4.15 per kg for BPL and Rs. 2 per kg for AAA families) have been maintained since 2002.

·         Under the targeted PDS(TPDS), allocation of food grains is being made to 6.52 crore AAY and BPL families at 35kg per family per month at a highly CIP.

·         The government has allocated rice and wheat under the Open Market Sales Scheme(OMSS).

·         The scheme for imports of pulses which envisaged imports for distribution of BPL households through the PDS with a subsidy of Rs. 10 per kg operated from November 2008 to June 2012. The government has decided to implement a varied form with a subsidy element of Rs. 20 per kg per month for BPL cardholders for the residual part of the current year.

·         The Scheme for Distribution of Subsidized Imported Edible Oils has been implemented since 2008-09 through state/union territory(UT) governments for distribution of 1 litre per ration card per month with a central subsidy of Rs. 15 per kg.  The scheme has been extended up to 30 September 2013.

Fiscal measures

·         Import duties for wheat, onions, pulses and crude palmolein were reduced to zero and 7.5 per cent for refined vegetable and hydrogenated oils respectively.

·         Duty-free import of white/raw sugar was extended up to 30 June 2012. Presently the import duty has been fixed at 10 per cent.

 Source : PIB Release, 27 Feb, 2013

Administrative Measures

·         Ban on exports of onions was imposed for short periods of time whenever required.  Exports of onions were calibrated through the mechanism of minimum export prices(MEP).

·         Future trading in rice, urad, tur, guar, gum and guar seed was suspended.

·         Exports of edible oils (except coconut oil and forest-based oil) and edible oils in blended consumer packs up to 5kg with a capacity of 20,000 tons per annum and pulses (except Kabuli chana and organic pulses and lentils up to a maximum of 10,000 tones per annum) were banned.

·          Stock limits were imposed from time to time in the case of select essential commodities such as pulses, edible oil, and edible oilseeds and in respect of paddy and rice up to 30 November 2013.

 Budgetary and other measures

·         The government launched a National Mission for Protein Supplements in 2001-12 with an allocation of Rs. 300 crore.  To broaden the scope of production of fish to coastal aquaculture, apart from fresh water aquaculture, the outlay in 2012-13 was stepped up to Rs. 500 crore.  Recently the government permitted FDI in multibrand retail trading.  This will help consumers and farmers as it will improve the selling and purchasing facilities.

Monetary measures

·         The RBI had also taken suitable steps to contain inflation with 13 consecutive increases by 375 basis points(bps) in policy rates from March 2010 to October 2011.

Source : PIB Release, 27 Feb, 2013