Rice prices drop in Telangana, courtesy PDS sop

By P Krishna

The state government’s decision to distribute fine rice through the Public Distribution System (PDS) is impacting prices of that variety of rice in the open market.

Prices have fallen sharply—fine rice that until recently was being sold at Rs 5,500 per quintal is now available for as low as Rs 4,000 per quintal. Retailers believe prices could fall further if the current trend continues.

Under the state government’s scheme, each beneficiary in a family receives six kg of fine rice per month.

Previously, beneficiaries would sell their coarse rice allotment to retailers and buy fine rice by paying the difference. Retailers then transported the coarse rice to states like Maharashtra and Gujarat to sell to local traders. The government has now stopped supplying coarse rice under the PDS and replaced it with fine rice, in line with the election promise by the Congress.

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This has brought an immediate and visible change in behaviour among the beneficiaries. Long queues are being seen at ration shops since the distribution of fine rice began. Beneficiaries are now consuming the rice received through the PDS instead of selling it, affecting the retail market.

Srinu, a retailer, told TNIE that rice mills have also been affected and that business could decline by half.

“In the past, we used to sell four to five quintals of fine rice daily. Now, selling even one or two quintals is difficult. The price has dropped from Rs 5,500 to Rs 4,000 per quintal. Those with large stocks are worst affected. This might also put a stop to smuggling of non-PDS rice to other states,” said another trader, Ramesh.

This article has been republished from The New Indian Express.