Shanta Kumar Committee on Restructuring of FCI submits report to PM

The High Level Committee (HLC) for Restructuring of Food Corporation of India (FCI) chaired by Shanta Kumar has submitted its report to the Prime Minister Narendra Modi.

Some Recommendations of Shanta Kumar Committee

On procurement related issues:  

• FCI should hand over all procurement operations of wheat, paddy and rice to Andhra Pradesh, Chhattisgarh, Haryana, Madhya Pradesh, Odisha and Punjab as they have sufficient experience and reasonable infrastructure for procurement.
• FCI procurement should focus on eastern belt, where farmers do not get minimum support price.

On stocking and movement related issues:

• FCI should outsource its stocking operations to various agencies such as Central Warehousing Corporation (CWC), State Warehousing Corporation (SWC), Private Sector under Private Entrepreneur Guarantee (PEG) scheme.
• It should be done on competitive bidding basis, inviting various stakeholders and creating competition to bring down costs of storage.
• Movement of grains should be containerized in order to reduce transit losses. While, railways should have faster turn-around-time by having more mechanized facilities.

NFSA and PDS related issues

• Restructuring the National Food Security Act (NFSA) by virtually diluting its scope and coverage from 67 per cent of population to about 40 per cent population.
• In order to curtail leakages in PDS, government should defer implementation of NFSA in states that have not done end to end computerization.

End to end computerization:

• It recommends end to end computerization of the entire food management system, starting from procurement from farmers, to stocking, movement and finally distribution through PDS.
• It will help for real time basis monitoring in order to curb leakages.

Background

In August 2014, Union government had set up 8 members High Level Committee (HLC) on FCI restructuring. It was restructuring chaired by Shanta Kumar.

Other members are: FCI Chairman-cum-Managing Director C Viswanath, Electronic and IT Secretary Ram Sewak Sharma, Former Chairman of Commission for Agricultural Costs and Prices (CACP) Ashok Gulati, Chief Secretaries of Punjab and Chhattisgarh; and Academicians G Raghuram and Gunmadi Nancharaiah of IIM-Ahmedabad.