New Delhi: An Empowered Group of Ministers (EGoM) on Monday approved the draft Food Security Bill, which will provide highly subsidised wheat and rice to the poor as a matter of legal right.

The ministers' panel headed by Finance Minister Pranab Mukherjee cleared the flagship proposal of the UPA government which will provide foodgrains at a cheap rate to 75 per cent of the rural population and 50 per cent of those living in cities. Thus 68 per cent of the country's total population will have the food security.

The states which have a crucial role in implementation of the programme will also be taken on board. The bill after being vetted by the Law Ministry would be before the chief ministers and after that will go to Parliament.

"Our intention is to place it before Parliament in the Monsoon Session," a source said after the EGoM meeting.

Under the Bill which will give legal right to the beneficiaries for food, a quantity of 7 kg per month per person will be given to the 'priority sector' (Below Poverty Line). It will be provided at Rs 3 per kg for rice and Rs 2 per kg for wheat.

For the general category (Above Poverty Line) the food quantity will be 3-4 kg per person. The rate will be half of the minimum support price which the government pays to farmers.

The Food Security Bill, requiring 51 million tonnes of foodgrains will involve an additional subsidy outgo of Rs 13,000 crore, taking the total food subsidy to Rs 95,000 crore.

Export of non-basmati rice allowed

The government has allowed exports of one million tonnes of non-basmati rice, lifting an over three-year old ban, in the wake of overflowing godowns.

"The EGoM has decided to allow exports of one million tonnes of non-basmati rice but a decision on allowing wheat exports has been deferred," a source said after the meeting.

The ban on non-basmati rice was imposed in April 2008 because of high food inflation. Wheat exports have been prohibited since 2007.

Sources said the export of the staple rice has been allowed as the country's godowns are overflowing with the bumper crop. There is also an acute shortage of storage facilities.

While food inflation still remains high at 7.61 per cent, the prices of wheat and rice have remained stable. Currently, the government godowns are overflowing with over 65 million tonnes of foodgrains, while the storage capacity is only 62.23 million tonnes.

The Agriculture Ministry has pegged total foodgrains output at 245 million tonnes for the 2011-12 crop year, as against 235.88 million tonnes last year. The EGoM has also approved export of five lakh tones each of wheat and rice through diplomatic route. The Ministry of External Affairs will, however, decide on the quantity and countries it would be shipped to, sources said.

EGoM to consider LPG

An Empowered Group of Ministers (EGoM) is likely to consider limiting supply of subsidised domestic LPG cylinders to 4-6 per household in a year.

The EGoM meeting is slated for Tuesday to consider recommendation of the Task Force on Direct Transfer of Subsidies on Kerosene, LPG and Fertiliser.

Sources said if approved, every household will get only 4-6 LPG cylinders at subsidised price of Rs 395.35 in Delhi and they will have to pay market price of about Rs 710 per bottle for any requirement beyond that.

The limited supply of subsidised LPG would be for those who own a car, two-wheeler, house or figure in the income-tax list.

Each 14.2-kg bottle of LPG normally lasts a household 45-60 days and based on this calculation a maximum of six cylinders are considered enough to see a family through the year.

Currently, records of LPG distributors of public sector companies shows that a vast number of households are taking as many as 20 to 30 cylinders per household each year.

In the second phase, the difference between the current retail price and the actual market price will be paid directly to BPL cardholders. This would be delivered through the unique identification number, Aadhar, as it is commonly known.

For kerosene, the Task Force has suggested direct subsidy transfer to the poor and market prices for others.

Sources said the EGoM may approve launch of pilot projects to test direct transfer of cash subsidy to the targeted populations in few states.

Seven states -- Tamil Nadu, Assam, Maharashtra, Haryana, Delhi, Rajasthan and Orissa -- have been identified for launch of the pilot projects from October, according to the road map suggested by the Unique Identification Authority of India (UIDAI).

(JPN/ Agencies)