Paddy Procurement: The Perennial Scam

By Sandeep Sahu

Scams may come and scams may go, but there is one scam that goes on forever in Odisha: the scam in paddy procurement. It has got to a stage where irregularities (read pilferage) of huge sums of money running into hundreds of crores by the well-entrenched miller-supply official-politician nexus every single year have stopped raising eyebrows. One just has to witness the lukewarm response to the revelation in the report of the Comptroller and Auditor General (CAG) laid in the state Assembly on Monday about massive bungling in the procurement of paddy in the 2013-14 and 2014-15 fiscal to realize it. It is as if everyone – the government, the millers, the people and even the media – has come to accept it as a fact of life about which nothing can be done.

Ironically, the CAG report came just a day after Food Supplies minister Sanjay Dasburma went through the charade of holding a ‘consultation’ with farmers from all 30 districts where suggestions were invited from them on how to streamline the procurement process in the coming kharif season beginning in November next. A new procurement policy taking these suggestions into consideration would get the cabinet nod soon, Dasburma told the farmers at the meeting assuring them that mandis will be opened and farmers paid their dues in time.

A few nuggets of information from the CAG report would bring out the extent of the scam in all its damning details. The state lost out on central subsidy worth Rs 581 crore between 2010 and 2015 because of its failure to settle the accounts in time. Failure to open mandis in time forced farmers to sell their produce for Rs 700-800 instead of the minimum support price (MSP) of Rs 1310 in the procurement year 2013-14. Millers in five districts – Bargarh, Jharsuguda, Sambalpur, Sunargarh and Kalahandi – procured 9.48 lakh tonnes of paddy instead of the 5.75 lakh tones they were entitled to – excess procurement of 3.73 lakh tones worth about Rs 496 crore. At the other end of the supply chain, millers failed to supply 61, 561 tonnes of rice they were duty bound to – resulting in a loss of Rs 126 crore. An average of 3-4 kg was deducted from every quintal of paddy sold by the farmer on the ground that it did not meet the standards of fair average quality (FAQ), but the full 100 kg was shown in the records resulting in windfall gain of Rrs 305 crore for the millers. And last but not the least, an incredible 1914 quintals of paddy was procured from 19 landless farmers!

Variations of these figures are mentioned in virtually every single report of the CAG. But the fate of all these reports has proved that these ‘revelations’ are not worth the paper they are written on.

There is plenty that does not make it into any CAG report but is true nonetheless. An RTI query brought out the startling revelation that an incredible 77, 000 tonnes of paddy was procured from the farmers of Nuapada in 2008, a year in which this poorest of poor district was reeling under the impact of a severe drought and more than half the farmers had migrated out of the state in search of work. An inquiry ordered by the collector following the RTI revelation found that more than 50% of the farmers, who had supposedly sold their paddy to the millers, just did not exist! In other words, the procurement of 77, 000 tonnes was a complete lie. As if that was not bad enough, the RTI answer also revealed that the millers had supplied 44, 000 tonnes of rice to the Supplies department against the paddy procured – as they were obliged to under the rules.

So, where did this rice come from if the paddy was never procured in the first place?

This brings us to the next layer of the scam that operates with clinical efficiency; the recycling of subsidized rice supplied to ‘ghost’ BPL beneficiaries. In reality, much of the BPL rice finds its way to the rice millers through the well oiled network of miller-dealer-storage agent, only to be supplied to the government as what is not known as ‘levy’ rice (the rice supplied by millers to the government in lieu of the paddy procured by them).

The scale of this perennial scam is mind-boggling and unraveling its intricate, multi-layered labyrinth is a task that not many people are ill equipped to handle. Perhaps that is the reason this scam has gone on for so long even as farmers continue to commit suicide in hundreds because of their failure to sell their produce and get timely payment for it when they do manage to ‘sell’ it.

Meanwhile, an uncaring government continues to boast about winning the ‘krishi karman’ award year after year to prove its pro-farmer credentials!