'Food security ordinance will affect 1.7 pc of GDP'

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SME Times News Bureau | 20 Jul, 2013
Food security ordinance, which will benefit 82 crore Indians, will affect 1.7 percent of India's Gross Domestic Product (GDP) Industries and Commerce Minister of Haryana, Randeep Singh Surjewala Friday said.

"Some economists in the country have been giving figures that 3.8 percent of the GDP will be eaten away by this scheme. I want to respectfully tell them that they are wrong. Even if you take the entire expenditure of the scheme, it comes to about 1.7 percent of GDP," Surjewala told journalists here in Meghalaya.

However, there were others who said the fiscal impact of the United Progressive Alliance government's flagship social welfare scheme will not exceed 0.1 to 0.15 percent of GDP in 2013-2014, most of which has been factored into the budget.

The Congress leader, who was in the Meghalaya capital to explain the ordinance as part of a Congress campaign, said that at current prices, the existing food subsidy bill of the centre is about Rs.1.3 lakh crore.

"So you are only adding about Rs.22,000 crore and taking the security net from 6.5 crore families to 82 crore Indians. I think it is a valid price to pay," he said

Stating that the ordinance was "not a welfare measure", but a "statutory right", Surjewala said that the entire bill will be footed by the centre and there will be no burden passed on to the state governments.

"This life-changing and often life-giving piece of legislation has risen from a deep-rooted commitment to the cause of the poor, women and children as also an unfathomable quest to hit at and eradicate hunger and poverty," he said.

The ordinance, which will have to be implemented by all state governments within 180 days from July 5, seeks to provide 5 kg of subsidised food grains per person per month to 82 crore Indians at a cumulative cost of Rs.1,24,747 crore by supplying 72.6 million tonnes of food grains annually.

"If state governments fail to implement the scheme within the stipulated 180 days, then the beneficiaries have every right to claim the food security allowance," he said.

Congress supremo Sonia Gandhi, who recently met all chief ministers of Congress-ruled states, wanted that the UPA's national food security ordinance be rolled out in all Congress-ruled states Aug 20, the birthday of former prime minister Rajiv Gandhi.

The right to food scheme is aimed at being a "game changer", ahead of the five assembly polls this year and the 2014 general elections.