THIRUVANANTHAPURAM: The finance department sanctioned Rs 250 crore to Supplyco for market intervention and supply of paddy procured from farmers at a time they have to pay Rs 4200 crore in several ways.

Rs 1200 crore rupees is due to Supplyco as the state government's share only for procurement of paddy from farmers. Rs 3000 crores to be paid by the government for the sale of food items at subsidized rates and market intervention. Thus a total of Rs 4200 crores. This amount is not even 6% of what Supplyco is getting. This indicates that market intervention from the Civil Supplies Corporation will be a daydream.

It is known that Rs 180 crores of the current allocation is in the form of State Incentive Bonus (SIB) for paddy procurement and Rs 70 crores for market intervention. SupplyCo owes Rs 450 crore to the farmers as the price of paddy procurement.

In the past one year, the government had not released even a single rupee towards the paddy stock. That is how the arrears came to Rs.1200 crores. About Rs 500 crore are to be received from the Centre as support price of paddy. The amount will be received from the central government once in three months based on the submission of the account of the stocked rice and distributed to the ration shops. In the state, paddy is procured at Rs 28.20 per kg, of which Rs 20.40 is the central support price and Rs 7.80 as state incentive bonus.

Due to the increase in the arrears of the state share, Supplyco is forced to take loans from banks and pay the arrears. Although Kerala Bank has expressed its willingness to provide a loan of Rs 400 crore, the final decision will be taken in the discussions held on 7th of next month. Only after receiving this loan can the farmers pay their dues before Onam. More arrears are due on paddy stored after May 15.

Supplyco has now been allocated Rs 70 crore for market intervention out of a budget of Rs 190 crore this financial year. Earlier, in a meeting held in the presence of the Chief Minister and Ministers of Food and Finance, the Finance Department had stated that Rs 800 crore could be given to Supplyco, but due to financial crisis, the amount was not allocated.