The Tamil Nadu government under the TVK has procured tur dal for the Public Distribution System (PDS) at an average price of ₹77.89 per kg, around ₹31.26 or 29% lower than the ₹109.15 per kg paid under the previous DMK government, resulting in savings of ₹187.56 crore over the last three months, as reported in The New Indian Express.
The Tamil Nadu Civil Supplies Corporation (TNCSC) procured 60,000 tonnes of tur dal for distribution through fair price shops between July and September at a total cost of ₹467.34 crore.
In comparison, the previous DMK government had spent ₹654.9 crore every three months to procure the same quantity of tur dal with identical quality and specifications, according to official procurement documents.
If the TNCSC manages to secure the current procurement price in its next three tenders covering another nine months, the annual savings to the state exchequer could rise to around ₹750 crore.
Tur Dal Procurement Price Drops 29%
The latest procurement price is reflected in work orders issued by the TNCSC to six contractors for supplying tur dal from September. The documents reportedly show an average procurement price of ₹77.89 per kg.
The previous procurement price of ₹109.15 per kg is also recorded in official documents, including the policy note tabled during the recently concluded Assembly session. Ration shop bills issued since July last year also reportedly show the same rate.
The latest tender was the first one floated after the TVK government assumed office.
TNCSC Managing Director Shilpa Prabhakar Satish said the specifications and quality parameters for tur dal had remained unchanged in the latest procurement. She said the tender had been conducted in accordance with the existing procedures and suggested that the lower price could have resulted from greater participation by suppliers.
A Food Department official said the decline was significant because procurement costs would ordinarily be expected to rise amid inflation and increases in food commodity prices.
According to the official, tur dal procurement prices should ideally have increased by around 5% to 10% under prevailing market conditions. Instead, the procurement price fell by 29%, which the official said indicated that a higher price had been paid under the previous regime.
The official added that the government would have to decide whether any further action was warranted.
20,000 Tonnes Distributed Every Month
Under the special PDS scheme, around 20,000 tonnes of tur dal is allocated every month for distribution to ration cardholders, with each eligible card receiving one kg.
Around 86% to 88% of cardholders reportedly purchase the commodity at the subsidised rate of ₹30 per kg.
The new procurement price will soon be reflected in ration shop bills, allowing consumers to compare the procurement costs every three months, according to the Food Department official.
The special PDS scheme was introduced by former Chief Minister M. Karunanidhi on 14 April 2007, with the stated objective of controlling the prices of essential commodities in the open market. Under the scheme, one kg of dal and one litre of cooking oil are sold at subsidised rates of ₹30 and ₹25 respectively.
The scheme entails an annual expenditure of around ₹5,600 crore to ₹6,000 crore. The state government has been funding the scheme in recent years through bank loans.
According to the white paper released in June, the outstanding debt of the TNCSC stood at ₹27,181 crore as of March this year.
DMK Regime’s Higher Procurement Cost Raises Questions
The latest procurement figures have raised questions over why the state paid ₹109.15 per kg for tur dal under the previous DMK government when the same commodity, with no change in specifications or quality parameters, is now being procured for ₹77.89 per kg.
The last tender under the DMK government was finalised on May 2, two days before the announcement of the election results, with the stocks procured under that tender continuing to be distributed until the end of August.
A comparison of procurement prices also shows that the TVK government has spent ₹467.34 crore for 60,000 tonnes of tur dal between July and September, against ₹654.9 crore spent by the previous government for the same quantity over a three-month period.
If the current price is maintained over the next three tenders covering nine months, the state could potentially save around ₹750 crore over a year.
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