SANGAM

Pre-Dashain Import Curse

SANGAM PRASAIN
KATHMANDU, SEP 06 -
The government is importing 20,000 tons of rice, 50,000 tons of wheat and 25,000 tons of sugar from India to meet the increased demand during the Dashain festival.

Demand for foodstuffs usually doubles during festivals with shortages leading to price hikes.

“The move is to intervene in the market with the private players who have a monopoly role in supply, as during the festive time there is high chances of creating an artificial shortage to increase the price,” said Ganesh Dhakal spokesman at the Ministry of Commerce and Supplies (MoCS).

According to him, government distribution will be a hedge against the monopoly of private distributors and also to ensure the real price and quality of food items,” Dhakal added.

Although the government has 19,000 tons of food as a buffer stock, the import is to make the supply side smooth as the festive period requires big chunk of foodstuffs, he said.

As a buffer stock, 15,000 tons are reserved for domestic consumption while 4,000 tons are for the SAARC Food Bank that could be distributed to any neighbouring country if a food crisis occurs there.

Of the total food import, wheat and sugar delivery will be on time, however, due to some procedures to follow regarding the price and quality of rice, shipment of rice will take some time, he said. Distribution of wheat and sugar will be entrusted to Salt Trading Corporation while distribution of rice will be assigned to Nepal Food Corporation. Earlier, the private sector used to import food items, however, after the Indian government banned export of food (except basmati rice), the Nepal government started the shipment process through a diplomatic channel, he said.

Nepal had requested the Indian government to provide 200,000 tons of food grain to Nepal from Indian state entities during Prime Minister Madhav Kumar Nepal’s New Delhi visit.

Following the request, the Indian government had approved the supply of 50,000 tons of wheat and 25,000 tons of rice at the market price for Nepal for 2010. The Ministry of Agriculture and Cooperatives (MoAC) estimates that the food deficit in Nepal mounted to 500,000 tons in 2009/10 from its earlier deficit estimate of 316,000 tons. The MoAC’s last fiscal year’s production report revealed

that overall grain production

dropped to 7.76 million tons. In the previous fiscal year, overall grain output was recorded at 8.11 million tons. Paddy production declined by about 11 percent to 4.02 million tons. In the previous year, paddy production was 4.52 million tons.

However, wheat output has increased by 16 percent in the last fiscal year compared to the previous year. Wheat production was about 1.56 million tons in 2009/10 compared to 1.34 million tons in 2008/09. The share of paddy production in the total grain output is 45 percent, followed by wheat (24 percent), maize (26 percent), millet (5 percent) and barley (1 percent). With the estimated deficit, over 1.7 million people are estimated to face food unavailability, according to the ministry. The fall in grain production has been attributed to lack of modern irrigation facilities, increasing plotting of productive land for housing

construction and traditional agricultural methods.