Augmenting capacity – on setting up decentralised grain storage facility

Source: The post is based on an article “Augmenting capacity” published in Business Standard on 8^th June 2023.

Syllabus: GS 3 – storage, transport and marketing of agricultural produce

News: Rs 1-trillion programme approved by the Union Cabinet in India to create the world’s largest decentralised grain storage capacity in the cooperative sector.

The godowns will be built at the block level and run by cooperatives.

Cooperative societies would provide various utilitarian services to farmers. Which will include grain procurement, fair price shops, custom hiring centers for farm machinery, and common facilities for grading, sorting, assaying, and preliminary processing of the farm produce.

How will the grain storage facility benefit farmers?

Saving on transportation costs, as they would not have to take the produce to distant mandis (markets).

Realization of better prices by keeping their produce in safe custody and selling them in the lean season at higher prices.

The post-harvest losses for perishable commodities like fruit and vegetables are as high as 25 to 30 per cent.

The receipts issued by the warehouses for the stored stuff would serve as legally valid collateral for institutional loans.

On a broad level, it will tackle the paucity of grain storage space by increasing capacity by 70 million tonnes.

Lastly, the scheme will not create an extra burden on the exchequer. It would be implemented by the Ministry of Cooperation by leveraging the funds available under various existing schemes of different ministries