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Procurement: Punjab had agreed to DBT for farmers in February | Chandigarh News – Times of India

CHANDIGARH: The Punjab government is opposing the Centre’s instructions on the direct bank transfer of money to farmers directly for their produce sold at minimum support price (MSP) and wants to route the payment through arhtiyas (commission agents), but the state itself had agreed in February this year to transfer the payment directly to farmers’ bank accounts.
On February 9, the Punjab government through its principal secretary, department of food and supply, had signed a MOU having specific clauses with regard to the payment of MSP directly to farmers’ bank accounts through online procurement system besides other terms and conditions.
The MOU, on “decentralized procurement for procurement of wheat for Rabi Marketing Season 2020-21 onwards,” signed between Punjab and the FCI stated that wheat shall be procured by state government or its agencies at MSP declared by the GOI from time to time.
Repeated relaxations given for direct online payment to farmers
Any bonus/financial incentive in direct or indirect form declared by the government of Punjab, over and above the MSP declared by GOI, shall be borne by the state government.
“The payment of MSP and bonus, if any, is to be made directly to farmers’ bank accounts online only through online procurement system by the state government/its agencies preferably within 48 hours of the purchase of wheat. The state agencies shall ensure the use of EAT module of PFMS while making the payment, as mandated by the ministry of finance, Government of India. The state government may take action to integrate their online payment system with PFMS, wherever applicable. The Online Procurement System shall necessarily have the features of online registration of farmers and online payment to them; and all other features as mandated by the Government of India,” according to Clause-5 of the MOU.
Clauses 25 and 26 of the MOU state, “In case of any dispute arising out of the operation of the scheme or interpretation of the terms of the MOU, the decision of the central government taken, shall be final. The MOU will be applicable for the RMS 2020-21 onwards for procurement operations of wheat.”
An examination of various official communications between the Centre and the Punjab government on procurement has been revealed that repeated relaxations were given for the implementation of online direct payment to the farmers, right from 2019. However, Punjab had only sought time to implement the direct transfer scheme every time and had made no other objection.
In a letter dated August 21, 2019, the Centre had directed that an online procurement system has to be put in place by the middle of September 2019 and directed FCI to accept custom milled rice (CMR) and make payment to the state agencies only if the payments are made online directly to the accounts of registered farmers by the agencies. The states were also asked to make changes in their APMC Acts in line with the Centre’s instructions on utilization of subsidy and tracking it till the end beneficiary.
However, the Centre vide letter dated December 2, 2019 considered the request of the state government as a special case and Punjab was informed that no further relaxation will be accorded in future and it will have to implement direct online payment to farmers from RMS 2020-21onwards without fail.
The FCI in letter dated January 3, 2020, requested Punjab to make necessary changes in APMC Act in line with GOI directions. Accordingly, the state government amended the relevant clause of the APMC Act in January 2020.
However, vide notification dated April 8, 2020, Punjab again made amendments for making payments through arhtiyas. Thereafter, it requested for relaxation during RMS 2020-21 after which the Centre vide letter dated April 24, 2020, said that in view of the ongoing Covid-19 pandemic and associated lockdown conditions requiring observance of social distancing norms, there can be risks associated with the registration of farmers and it was decided that the payment to farmers through arhtiyas was permitted subject to certain conditions. This relaxation was applicable only to RMS 2020-21. Thereafter, at the time of Kharif Marketing Season (KMS) 2020-21, Punjab informed that owing to pre-ponement of procurement season, agitation by farmers due to three agriculture laws, the state could not complete KYC of farmers for ensuring direct online payment from state agency through Anaaj Kharid portal and accordingly requested the Centre to continue with existing arrangements of payment of MSP in KMS 2020-21through arhtiyas temporarily.
Again vide letter dated October 6, 2020, Punjab’s request was considered by the Centre in the public interest, and it was decided to allow online MSP payment to the farmers through arhtiyas in Punjab only for KMS 2020-21subject to certain conditions. Thereafter, Punjab was asked to ensure implementation of direct online payment from RMS 2021-22 instead of through intermediaries or arhtiyas in compliance with PFMS mandate.

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