BJP demands ban on Futures in rice, wheat, pulses

New Delhi, July 2: Finding that the Futures trading in the foodgrains were being misused by the unscrupulous elements for hoarding and price manipulations, the Bharatiya Janata Party today urged the Government to ban the trading in essential commodities like wheat, rice and pulses.

Mr Jagadish Shettigar, a former member of Prime Minister's Economic Council and the BJP think tank, said in view of the 'bad experience' of working of the Futures, it would be proper to ban the Futures from trading in wheat, rice and pulses to save the farmers and consumers as well. He said the this trading is supposed to function under the National Commodities Exchange but obviously the regulatory mechanism was not working effectively, resulting in farmers and consumers being fleeced by the system.

He said the Futures can work in European environment where the farmers were informed and united unlike in India where they did not decide prices of inputs or outputs and hence were not active players at all. If the system had functioned properly, the country would not have witnessed so many suicides by farmers.

Mr Shettigar said although the Future trading was introduced during the NDA regime with a good intention of helping the farmers and regulating the trade, but since the system doesn't seem to be working to the benefit of either farmers or consumers, it is better to have a rethink about the system.

The food storage situation was totally different during the NDA regime when the granaries used to be full and there was no short supply of foodgrains in the country. Today, the goverment had deliberately allowed manipulations by private operators to jack up the prices leaving both farmers and consumers high and dry. The policy to allow private imports would only help them to rub salt on the farmers wounds, he said.

The economist said the agricultural production for 2005-06 was not at all insufficient to endanger the food security as the overall grain production in the country was almost comparable to the production achieved in the previous year. Only the wheat production was marginally less whereas the sugar and pulses production had in fact surpassed last year's figures. The FCI wheat procurement was deliberately kept low to enable private operators to mop up the produce by pegging down the Minimum Support Price at Rs 650 and hiked the MSP by Rs 50.

He said the total FCI procurement this year was 7.2 M T tonnes as against 18 M T of requirement for various ongoing government run welfare schemes like food for work, mid-day meals programmes.

UNI