CHENNAI: The Tamil Nadu government has requested the union government to release pending dues amounting to Rs 2,670.64 crore. These dues relate to expenses incurred by the state for paddy procurement, rice fortification, and subsidies for ragi and sugar.
Of the roughly 2.25 crore ration cards in Tamil Nadu, the cost of supplying rice through the Public Distribution System (PDS) to 1.12 crore cards (covering 3.6 crore beneficiaries) is fully borne by the centre under the National Food Security Act (NFSA).
Of the total outstanding dues of Rs 2,670.64 crore, a sum of Rs 2,181.88 crore has been carried over from the financial years 2016-17 to 2020-21. Additionally, Rs 431.55 crore is pending as subsidy for ration cards that were migrated within Tamil Nadu during the same period.
In relation to the supply of fortified rice, the state government incurred an expenditure of Rs 244.06 crore, of which the centre has released only Rs 197.26 crore, leaving a balance of Rs 46.80 crore. Food and Civil Supplies Minister R Sakkarapani submitted a memorandum on this matter to Union Minister for Consumer Affairs, Pralhad Joshi, on Wednesday.
According to official sources, the centre disburses funds to the state at regular intervals under various heads, including procurement, milling, and distribution of rice through the PDS. These disbursals are based on claims submitted via the online portal annavitran.nic.in.
However, subsidy is generally not released for paddy that fails quality inspection by teams that include officials from the Food Corporation of India (FCI). Such rejected quantities typically account for 0.2% to 0.5% of total procurement costs. Funds are also often withheld due to discrepancies in online data entries or categorisation of expenditures. These are usually released once the data is updated and validated.
In 2020-21, the state government raised a claim of Rs 5,782.02 crore. However, due to mismatches in paddy/rice quantities recorded in the annavitran portal, the centre released only Rs 4,617.29 crore and withheld Rs 1,164.73 crore. The discrepancies have since been rectified and communicated to the union government, sources added.
The state government has also requested the centre to finalise the economic cost of rice for the Kharif Marketing Seasons for 2010-11, 2013-14, and 2014-15. The economic cost comprises the minimum support price for paddy, along with expenses related to milling, transportation, labour, and other charges involved in converting paddy into rice. However, the centre did not fully accept the proposals submitted. Similarly, the union government had reduced the final economic cost for paddy procurement in 2011-12, prompting the state to seek a revision.