Entrustment of Decentralised Procurement for KMS 2012-13 to the AP State Civil Supplies Corporation Limited

Government  of  India  had  written  to  the Government of Andhra Pradesh to adopt decentralized procurement of paddy, become a Decentralised Procurement State and also increase direct procurement of paddy from farmers instead of depending heavily on levy route.   According to the Decentralised Procurement Scheme  of  the  Government  of  India  (i)  the  State Government  through  its  agency shall procure paddy/rice from the farmers/millers at Minimum Support Price/at levy rate, utilize it for the PDS and other schemes as per the allotment made by the Government of India and deliver surplus rice, if any, to the FCI for the Central pool; ii) the Central Government undertakes to meet the entire expenditure incurred by the State Government towards the procurement (acquisition)  cost  and  distribution cost  as  per  the  approved  costing by the Government of India; iii) release provisional subsidy, 100% of fixed incidentals such as MSP, taxes and statutory levies including VAT, Milling charges, driage (for raw rice only) and  balance incidentals which are variable at 95%; and iv) release of  the advance quarterly subsidy  at 90% of admissible claim at the beginning of the quarter and provisional quarterly subsidy at the end of a quarter at 95% of admissible claim on receipt of their claims. Balance 5% subsidy shall be released after finalization of accounts and fixation of final economic cost on the basis of audited accounts and supporting documents furnished for the year in question by the State.

The advantages in the decentralized procurement are :i) ensures MSP to famers due to direct involvement of State agencies; ii) timely payment of MSP to farmers ; iii) self-reliance in procuring rice for PDS distribution;  and iv) increase in the employment in the State due to huge man power requirement for smooth operation of procurement process etc.

Government   of   Andhra   Pradesh,   after   careful   consideration   of   the   issue, communicated to the Government of India that Andhra Pradesh will undertake the decentralized procurement from Kharif Marketing Season 2012-13 – vide reference. Government of India vide reference , communicated their principle approval for adoption of Decentralised procurement system for paddy procurement in Andhra Pradesh starting from KMS 2012-13 and desired that the signed MoU shall be sent by the Government of Andhra Pradesh at the earliest for taking further action.

Government of Andhra Pradesh hereby issues orders that the Andhra Pradesh State Civil Supplies Corporation shall undertake the Decentralised procurement of paddy/rice during KMS 2012-13, from farmers/millers and utilize the resultant rice for its PDS and other welfare schemes as per the DCP scheme and hand over the surplus rice to the Food Corporation of India.  The Government of Andhra Pradesh shall review the situation in due course and take a decision on the need of any exclusive Corporation for the procurement of rice under Decentralised Procurement.

The VC & Managing Director of A.P. State Civil Supplies Corporation Ltd. shall take necessary action to ensure that all arrangements are made to accept the paddy from the farmers and also the levy raw rice from the rice millers under the decentralized procurement during KMS 2012-13.

The  Commissioner  of  Civil  Supplies  shall  send  the  costing  sheet  consisting  of acquisition cost and distribution cost for approval of the Govt.of India at the earliest. He shall also sign the Memorandum of Understanding and send it to the Government of India duly following the procedure laid down and keeping in view the costing sheet.

The Commissioner of Civil Supplies shall ensure that the paddy procurement under Decentralised procurement at MSP is done throughout the State.

Since Decentralised procurement is being taken up for the first time in the State, the VC & Managing Director of AP State Civil Supplies Corporation shall be permitted to take on deputation the required Officers and staff from the FCI for implementation of the scheme. He is requested to come up with proposal for the additional required staff required for quality check, maintenance of godowns, accounting procedures etc. from various sources for the implementation of the scheme.

1.   Lr.No.16(13)/2010-PY.I dated 10.1.2011 of the Ministry of Consumer Affairs, Food and Public Distribution, Department of Food and Public Distribution, New Delhi.

2.   Lr.No.5  (2)/2011-PY.I dated  29.8.2011  of  the  Ministry of  Consumer  Affairs, Food and Public Distribution, Department of Food and Public Distribution, New Delhi.

3.   Lr.No.10(1)/2012-PD.I(Vol.I)  dated  22.5.2012  of  the  Ministry  of  Consumer Affairs,   Food   and   Public   Distribution,   Department   of   Food   and   Public Distribution, New Delhi.

4.   Lr.No.PI(1)/1078/2012 dated 3.7.2012 of the Commissioner of Civil Supplies & Ex-Officio Secretary to Govt., Department of Consumer Affairs, Food and Civil Supplies, AP, Hyderabad.

5.   Lr.No.16(13)/2010-Py.I  dated  9.8.2012  of  the  Ministry  of  Consumer  Affairs, Food and Public Distribution, Department of Food and Public Distribution, New Delhi.

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