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Grain Storage Plan in Cooperative Sector

  • 07 Dec 2023
  • 9 min read

Source: PIB

Why in News?

Recently, the Ministry of Cooperation has shed light on the "World's Largest Grain Storage Plan in Cooperative Sector."

  • This initiative is aimed at addressing the persistent shortage of storage capacity for food grains in the country.

What is the Grain Storage Plan in the Cooperative Sector?

Primary Agricultural Cooperative Societies (PACS)

  • PACS are the grassroots level arms of the short-term co-operative credit structure headed by the State Cooperative Banks (SCB) at the state level.
    • PACS deals directly with rural (agricultural) borrowers, gives those loans, collects repayments of loans given and also undertakes distribution and marketing functions.

What are Initiatives Taken by Ministry of Agriculture to Address Food Grain Shortage?

  • Agriculture Infrastructure Fund (AIF):
    • AIF envisages the creation of post-harvest management infrastructure and community farming assets through incentives and financial support.
    • It includes interest subvention of 3% for a loan up to Rs. 2 Crore per project location for 7 years and reimbursement of credit guarantee fee if the project has credit guarantee cover under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) Scheme.
  • Pradhan Mantri Annadata Aay SanraksHan Abhiyan (PM-AASHA):
    • PM-AASHA aims at providing Minimum Support Price (MSP) to farmers for produce of notified oilseeds, pulses & copra.
    • It comprises the Price Support Scheme (PSS), Price Deficiency Payment Scheme (PDPS) and Private Procurement and Stockist Scheme (PPSS).
      • Price Support Scheme (PSS):
        • Implemented at the request of the concerned State Government.
          • Exempts procured pulses, oilseeds, and copra from mandi tax.
        • Central nodal agencies undertake procurement directly from pre-registered farmers at MSP when prices fall below MSP.
      • Price Deficiency Payment Scheme (PDPS):
        • Involves direct payment of the difference between MSP and the selling/model price.
        • Pre-registered farmers selling oilseeds of prescribed Fair Average Quality (FAQ) norms benefit through a transparent auction process in notified market yards.
      • Private Procurement and Stockist Scheme (PPSS):
        • States have the option to implement PPSS for oilseed procurement.
        • Procurement is conducted on a pilot basis from pre-registered farmers in selected districts or APMC(s).
  • Market Intervention Scheme (MIS):
    • MIS entails procurement of agricultural and horticultural commodities that are perishable and for which MSP is not announced, to protect the growers of these commodities from making distress sales in the event of a bumper crop when prices tend to fall below economic level/cost of production.
  • Bhartiya Beej Sahakari Samiti Limited (BBSSL):
    • Under the Multi-State Cooperative Societies Act, 2002, BBSSL has been set up as an Umbrella organization for the cultivation, production and distribution of improved seeds under a single brand name.
    • This Society will increase the availability of improved seeds to the farmers, boost the productivity of crops and enhance the income of the farmers.

UPSC Civil Services Examination Previous Year Questions (PYQs)

Prelims

Q1. Consider the following statements: (2020)

  1. In terms of short-term credit delivery to the agriculture sector, District Central Cooperative Banks (DCCBs) deliver more credit in comparison to Scheduled Commercial Banks and Regional Rural Banks.
  2. One of the most important functions of DCCBs is to provide funds to the Primary Agricultural Credit Societies.

Which of the statements given above is/are correct?

(a) 1 only
(b) 2 only
(c) Both 1 and 2
(d) Neither 1 nor 2

Ans: (b)

Q2. With reference to ‘Urban Cooperative Banks’ in India, consider the following statements: (2021)

  1. They are supervised and regulated by local boards set up by the State Governments.
  2. They can issue equity shares and preference shares.
  3. They were brought under the purview of the Banking Regulation Act, 1949 through an Amendment in 1966.

Which of the statements given above is/are correct?

(a) 1 only
(b) 2 and 3 only
(c) 1 and 3 only
(d) 1, 2 and 3

Ans: (b)


Mains

Q. In the villages itself no form of credit organisation will be suitable except the cooperative society.” – All India Rural Credit Survey. Discuss this statement in the background of agricultural finance in India. What constraints and challenges do financial institutions supplying agricultural finance face? How can technology be used to better reach and serve rural clients? (2014)

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