Telangana to pay additional Rs 500 per quintal above MSP for cultivating 'Sannarakam' paddy variety

Hyderabad: The Telangana government has decided to pay an additional Rs 500 per quintal above the Minimum Support Price (MSP) for cultivating the 'Sannarakam' variety of paddy.

Briefing Cabinet Sub-Committee on Paddy Procurement during the 2024-25 Kharif season, Civil Supplies and Irrigation Minister Capt N Uttam Kumar Reddy highlighted the government's intention to encourage farmers to cultivate 'Sannarakam' variety by offering an additional Rs 500 per quintal above MSP for paddy delivered to designated Paddy Procurement Centres (PPCs).

Deputy Chief Minister Bhatti Vikramarka Mallu, Industries Minister D Sridhar Babu, Civil Supplies Principal Secretary and Commissioner DS Chauhan, Principal Secretary of Agriculture Raghunandan, Director of Marketing Uday, and other senior officials attended the meeting.

The committee deliberated on various logistical aspects, including hiring godowns, securing bank guarantees from rice millers, milling charges, and addressing the drying loss issues related to paddy. The meeting aimed to ensure a well-structured system is in place to facilitate smooth procurement.

Uttam Kumar Reddy emphasized that the government has devised a detailed plan for the procurement of 'Sannarakam' paddy, a fine variety, during the Kharif 2024-25 season. He highlighted the government's intention to encourage farmers to cultivate this variety by offering an additional Rs 500 per quintal above the Minimum Support Price (MSP) for paddy delivered to designated Paddy Procurement Centres (PPCs). The procurement will ensure the availability of fortified ‘Sannabiyyam rice, which will be distributed through the Public Distribution System (PDS) starting in January 2025, depending on availability.

To streamline the procurement process, the Agriculture Department will share crop data with the Online Paddy Management System (OPMS), ensuring accurate information on the paddy varieties grown in the state. This system will enable efficient procurement, making payments directly to farmers' accounts. Uttam Kumar Reddy also stated that the Civil Supplies Department would run a comprehensive awareness campaign to educate farmers about the Rs 500 per quintal incentive for 'Sannarakam' paddy. In addition, training sessions will be conducted for PPC staff to ensure the correct identification of the 'Sannarakam' paddy, following the guidelines set by the Agriculture Department.

Separate PPCs will be established for the procurement of 'Sannarakam' and 'Doddurakam' paddy varieties, with locations decided by the respective District Collectors. Special equipment such as digital grain calipers and husk removers will be provided to assess the quality of 'Sannarakam' paddy at these centers. Bags containing 'Sannarakam' paddy will be stitched with red thread for easy identification, while bags of 'Doddurakam' will be tied with green thread. Both varieties will be transported separately from the PPCs to the mills, where rice millers will store them in designated sections to avoid any mixing of varieties.

To resolve disputes, the state government has set up committees at the Revenue Divisional and District levels to handle any issues related to paddy variety identification. Payments to farmers, including the additional incentive, will be processed through the e-Kuber platform managed by the Finance Department.

Addressing the millers, Uttam Kumar Reddy assured that the Civil Supplies Department has been functioning transparently over the last nine months. He encouraged rice millers to be honest in their dealings, assuring that the government would be fair and just in its approach. "In the interest of farmers, millers, and the general public, all decisions are being made to do justice to all stakeholders," he said. He also assured millers that their concerns would be addressed and that the government was serious about resolving their issues. He highlighted the potential for the rice milling industry to grow in Telangana, especially in rural areas. He promised the government's support in helping millers obtain pending dues from the Centre.

However, the minister warned that the state government would not tolerate any diversion of PDS rice. He noted that while the government views millers as partners in progress, it will ensure no damage to Telangana’s exchequer through any malpractice.

In the same meeting, the Rice Millers Association of Telangana presented a detailed report to the Cabinet Sub-Committee, outlining the critical challenges currently facing the industry. The association highlighted the reduced availability of paddy, with the paddy milling percentage having dropped to 14% this year. Large mills have witnessed a 55% to 60% decline in their operations due to reduced paddy procurement. The association also noted that inflation has increased production costs to Rs 300 per quintal. At the same time, the industry continues to grapple with the 1% levy imposed by the Department of Food and Public Distribution (DFPD). Additionally, millers are facing severe financial strain due to delayed payments from the government, with dues pending since the 2016-17 procurement operations, causing cash flow disruptions that have hampered their ability to manage daily operations. The imposition of penalties for non-compliance with Fair Average Quality (FAQ) standards has compounded the financial pressures on millers.

The association laid out a future roadmap for the industry and requested government support to sustain operations. Their goals include achieving 100% paddy milling by 2025, ensuring timely procurement, and implementing fair pricing mechanisms. The association also called for the clearance of pending dues and reduced levies to alleviate the sector's financial burden.

The Rice Millers Association appealed for immediate financial and regulatory relief from the Cabinet Subcommittee, stating that the future of the rice milling industry—and the broader agricultural sector—could be at risk without government intervention. They reaffirmed their commitment to working with the government to achieve full-capacity milling by 2025, strengthening Telangana’s position in the national rice production landscape.

In response, Deputy Chief Minister Bhatti Vikramarka Mallu assured the millers that their issues would be discussed at the highest levels of the state government. He said the Cabinet Sub-Committee would submit a report with recommendations to Chief Minister A Revanth Reddy for final approval.

Industries Minister D Sridhar Babu also acknowledged the importance of cooperation between the state and the rice milling industry, stressing that the state government is willing to offer full support to millers in achieving its paddy procurement objectives. He praised the revival of the Civil Supplies Department in the last ten months under the leadership of Uttam Kumar Reddy. He expressed confidence in the state’s approach to ensuring all stakeholders benefit from the government’s initiatives.