Price of rice nosedives in Kerala due to Rs 2 per KG scheme

By Rajiv Sinha (Khabrein.Info)

Trivandrum: Many businessmen dealing in agricultural products including rice had invested huge amount of money on procuring rice. But they seem to have been hit hard –in fact very hard- by the Kerala government decision to supply rice at Rs 2 per kilogram.

The agri-businessmen who are hardest hit by the Left Front government’s decision to sell rice at rs 2 per kg are those who bought a huge amount of low quality rice.

The prices of the rice in the state have fallen steadily in the last more than a month since the talk of rice for rs 1 per KG or Rs 2 per KG started.

The common people in Kerala won a great price-cut in rice market. On the heels of election offers from both LDF and UDF, the price of rice has come down to the lowest of last few months. The rice was too hot in the market along with other commodities since the beginning of 2011.

The major political fronts in the state had offered 1 kilo rice for mere 1 rupee once they get in to the office after Assembly elections. LDF had already launched the scheme of Rs 2 per Kg, just before the election procedures started. Election commission banned the move accusing it as the violation of election norms.

However, the government got the green light from High Court to go on with the low price rice policy. Once the strategy got wide popularity UDF put a step ahead offering Rs 1 per Kg for those who are Below Poverty Line (BPL). Congress led front also included APL card holders in the Rs 2 per Kg policy.

Once the rice took the top seat in the election offer list the whole salemarketers were compelled to cut the price from 27-35 to 16-24. The price of rice was highest ever in last few months thanks to the trend in commodity market. Since the state has to import huge amounts of rice from the rest of the country the price had been sky rocketing according to the market trend nationally.

And now the wholesalers realize that the high price of the rice will affect the market too badly if the people return to the public distribution system. They fear the availability of rice at cheap price under government scheme will hit the private market too gravely.

Meanwhile, the public distribution shop owners have declared that they can provide the recently declared Rs 2 per Kg for BPL, from the first of April. They noted that the scheme became possible once the HC removed the blockade and SC didn’t put any stay yet for the program.

The government has offered every support, including paying their debt of 26 crores, to the public distributers. This will speed up the ration distribution in coming days. At the first phase the distributers are asked to give away the rice in stock.

The low priced rice will remain as the top issue in ongoing election campaign and both fronts will highlight their price lists. As of now the LDF has won the popular support for launching such a scheme even in their outgoing days.