The recent controversy in Tamil Nadu over paddy procurement during the short-term kuruvai season has only strengthened the need for a relook at the procurement system of foodgrains as a whole. In this case — as in many States — the Tamil Nadu Civil Supplies Corporation (TNCSC), which procures paddy on behalf of the Food Corporation of India (FCI), found itself in a spot because of time overruns and charges of corruption. One of the reasons cited is the rise in the coverage of the crop during the season, by about two lakh acres, which was known as early as mid-August. This is because farmers feel it is a safe bet to grow paddy rather than other crops due to minimum assured returns.
Paddy procurement data
The glut is not restricted to Tamil Nadu. Going by the data of the Union Ministry of Consumer Affairs, Food and Public Distribution, the procurement of paddy (in terms of rice) all over the country was nearly 119.86 lakh tonnes as on October 31, 2025 compared to 82.08 lakh tonnes on the corresponding day last year. In the last three years, with regard to rice and wheat, the quarterly opening stock position, as on October 1, was consistently higher than what is prescribed under the norms for the central pool. In the case of rice, the quantity is at least two times more than the requirement. In October this year, the stock was 356.1 lakh tonnes against the norm of 102.5 lakh tonnes.
Compared to wheat, rice is still abundant, if one goes by the Union government’s data for the last three years on procurement and offtake under the National Food Security Act (NFSA) and other schemes. Between April 2022 and March 2025, the procurement of rice at the all-India level hovered around 525 lakh tonnes-547 lakh tonnes every year, whereas annual offtake under the Public Distribution System (PDS) was in the range of 392 lakh tonnes- 427 lakh tonnes.
Significantly, in the case of wheat, the utilisation under the PDS exceeded the quantity of procurement in two of the last three years (barring 2024-25). At the same time, it must be noted that the Union government spends around ₹2 lakh crore every year in food subsidy.
While, on the one hand, the country is grappling with surplus stocks of rice, on the other it is incurring a huge expenditure in the import of pulses and oilseeds, which are two essential commodities that are central in every Indian household. Ironically, in the case of pulses, India is the largest producer in the world — 252.4 lakh tonnes in 2024-25. The two years, from 2023-24, saw a substantial fall in the procurement of notified pulses at minimum support prices (MSP) through agencies which included the National Agricultural Cooperative Marketing Federation of India.
Edible oil imports
According to the annual report of the Union Ministry of Agriculture and Farmers Welfare for 2024-25, the country imported edible oil (₹1.2 lakh crore) and pulses (₹30,000 crore) during 2023-24. In the case of edible oil, about 55% of the demand is met only through imports. Needless to say, the Russia-Ukraine war, which began in February 2022, is a factor that contributed to the steep rise in the cost of edible oil imports which was around ₹82,000 crore in 2020-21, though the quantity imported remained between 135 lakh tonnes-157 lakh tonnes a year in the last six years.
Ironically, the country’s production of oilseeds, since 2014, crossed the 400-lakh-tonne mark only once, despite there being no large change in the area covered, which was around 25 million hectares. For about 25 years, experts and the media have been holding the government’s decision in the 1990s to allow the import of cheaper edible oil responsible for the adverse effect on domestic production. Yet, the response to counter the impact has not been adequate.
The situation raises a fundamental question: whether the country, in the name of ensuring food security, is following a sustainable policy of procurement at least with regard to rice. It also raises other pertinent questions. Is paddy cultivation being encouraged at the cost of crop rotation? Also, why is it that the country’s efforts to improve pulse and oilseed production have not been spectacular unlike in the case of paddy and wheat about 55 years ago? And, should India continue to have the existing arrangement of one or the other central agency in the procurement, storage, transportation and allocation of foodgrains in bulk to the States?
The authorities may protest, if any study is conducted with regard to leakage in the PDS (which was originally meant for managing food supplies during scarcity), as they did about a year ago when an Indian Council for Research on International Economic Relations (ICRIER) report had stated that there was about a 28% loss of rice and wheat during distribution. It is also well known that the system is far from perfect.
Incentivise crop diversification
To wean paddy-growing farmers from the cereal, crop diversification can be tried out after carrying out area-specific market studies of demand and supply with the involvement of every stakeholder. . One reason why farmers have not taken to diversification in a big way is uncertainty about success if there is a crop switch. Their apprehension can be allayed only by offering financial support and proper guidance. As it is clear that the country is producing more rice than required, the government should allow farmers to freely export rice and not resort to restrictions in a knee-jerk manner.
Many a time, primary procurers of agricultural products are in the dark about the suppliers. For instance, papad manufacturers getting to tie-up directly with farmers who raise blackgram or have the means to do so, will result in a win-win situation for both. If such farmers are able to organise themselves as farmers producers’ organisations (FPOs), the results will be more durable. The Centre and the States can facilitate such an arrangement.
As an institution, FPOs are still in a nascent stage. Their services can be tapped by the authorities for a range of purposes — educating farmers about soil health; sensitising them to go in for crop diversification; preparing the groundwork for market studies, and establishing the supply chain.
As in West Bengal, FPOs can be utilised for paddy procurement to reduce the load on existing players. Self-help groups and cooperative societies should also be encouraged more in this respect. Wherever required, all such new entrants should be covered under capacity building programmes.
Changes in such a complex system cannot happen overnight but a beginning can be made. It is time that agriculture experts, farmers, food security specialists, policy makers and planners collectively deliberated on ways to plug the loopholes in the system, if not reform it.
Published – November 19, 2025 12:16 am IST
