State mulls launching ‘Kerala Rice’ by revamping paddy procurement system

The Kerala government is exploring the possibility of launching the State’s own rice, Kerala Rice, by revamping the current paddy procurement system.

The new system envisaged by the State government also plans to give the price of the procured paddy to farmers at the time of procurement itself. As part of the new system, the State government has decided to implement a cooperative-farmer-centric alternative to paddy procurement.

A high-level meeting chaired by Chief Minister Pinarayi Vijayan on Monday decided to implement a two-tier procurement model using primary agricultural cooperative societies. The Chief Secretary and the Secretaries of the departments concerned have been entrusted with the task of implementing the new system of paddy procurement in the coming season itself.  Primary agricultural cooperative societies that are ready for paddy procurement will procure paddy directly from farmers. The price of paddy will be paid to the farmer without delay after procurement, avoiding dependence on existing Paddy Receipt Sheet (PRS)-based loans.

In the PRS-loan system, the farmers will get bank loans for their harvested paddy from the selected banks, with the State government repaying the principal and interest to the banks. However, the payment is often delayed due to delay in getting the Central share of procurement funds and also banking issues.  

Nodal society

As part of the new system, a nodal cooperative society will be formed with the participation of cooperative societies, Padashekara samitis (farmers’ collectives) and farmers at the district and taluk levels. Paddy in the respective areas will be procured through these cooperative societies. Later, the procured paddy will be processed in mills owned by the nodal societies, in rented mills or private mills. The paddy will be processed as per the prescribed out-turn ratio and supplied to the public distribution system.

The nodal groups will get the processing charges along with the broken rice, paddy husk, rice bran and so on, currently available to private mills. The main nodal agency for paddy procurement will be Supplyco. A special financial assistance loan scheme of Kerala Bank will be arranged for cooperative societies that are unable to procure paddy due to insufficient funds. The working capital loan required by the nodal cooperative societies will be provided through the Kerala Bank, the meeting decided.

Digital portal

For the successful implementation of the scheme, a district-level coordination committee comprising representatives of the Cooperative department, Food and Civil Supplies department, Agriculture department, Padashekhara samiti, representatives of paddy farmers, Kerala Bank and nodal cooperative societies will be formed under the chairmanship of the District Collector. A digital portal system will also be set up to monitor paddy procurement and disbursement of funds.

The new system also ensures that farmers will receive the procurement amount of paddy at the time of procurement. By avoiding delays in paddy procurement, it will be ensured that the procured paddy will not be damaged. In the future, price stability and value addition can be ensured through cooperative branding. Agricultural infrastructure for procurement will be created, and this model puts forward the possibility of launching Kerala’s own rice ‘Kerala Rice’, it was decided at the meeting.