Pulse Prices Issue

Retail prices of all major pulses have crossed Rs 100/ kg. In the case of tur/ arhar (pigeon pea), they have crossed the double-century mark of Rs 200/ kg in several places.

Tur prices in markets like Rajkot, Bangalore, Puducherry and Chennai have touched Rs 200/ kg (and even higher) — an annual increase of 100, 163, 147 and 141 per cent, respectively. Urad is following the lead closely.

Who in the government is accountable for the present situation in pulses?

-pulse production falling by more than two million tonnes (about 11 per cent) in 2014-15 over 2013-14.

-The effect of the 2015 drought on the major pulse-growing states — Maharashtra, Karnataka and Madhya Pradesh — meant that future supply pressures were near-certain. While traders had their ears to the ground.

POSSIBLE SOLUTIONS

  • First, the government should create a buffer stock of around two to three million tonnes from domestic production and/ or imports, and release it whenever pulse prices spike. Given that domestic consumption of pulses is around 23 million tonnes, this level of stocking is the minimum that is needed to stabilise prices.
  • Second, the government needs to create a crop-neutral incentive structure for farmers, which is at present skewed in favour of rice, wheat and sugarcane. Much of the subsidies on fertilisers, power, and irrigation go to these crops. These subsidies amount to more than Rs 10,000/ hectare. If the same amount were given to pulse growers, they would be incentivised to produce more.
  • Third, diversify and enhance the pulse basket. While yellow pea and lupins can be imported from Canada and Australia, respectively, we need to use soya flour, along with rice, wheat and other pulse flours, and re-constitute these into pulses. We are surplus in soya, and soya flour has a very high protein content — more than 40 per cent compared to 20-25 per cent for most other pulses. Technology to do this exists and can be tailored to Indian tastes. Innovations like this and incentives to produce more pulses are the way to go.
  • The MSP of tur, for instance, is now Rs 4,350 per quintal. There is no harm raising this to, say, Rs 5,000. At that price, and taking 70 per cent dal recovery — the costs of de-husking and splitting the raw grain can be recovered from sale of the balance 30 per cent by-products (husk and brokens) — the milled final product could be sold within Rs 75 per kg. Consumers won’t mind that, when tur dal is already retailing at Rs 100-plus.

Bridging the domestic demand-supply gap — India’s pulses imports were valued at $ 2.79 billion in 2014-15 — is, however, not the sole reason why MSPs need to be substantially hiked to boost production. Being leguminous plants whose root nodules harbour bacteria that naturally “fix” atmospheric nitrogen, pulses can save roughly one bag of urea per hectare for the succeeding crop. Promoting pulses cultivation is, therefore, good both from the standpoint of soil rejuvenation and correcting nutrient imbalance through reduced consumption of over-subsidised urea.

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