Open Market Sale Scheme

Context: Recently the Government of India has approved a proposal for the sale of 30 Lakh Metric Tonnes of wheat under the Open Market Sale Scheme.

About the Open Market Scheme:

• It refers to selling of foodgrains by Government / Government agencies at predetermined prices in the open market from time to time.
• It aims to enhance the supply of grains especially during the lean season and thereby to moderate the general open market prices especially in the deficit regions.
• In addition to maintaining buffer stocks and making a provision for meeting the requirement of the Targeted Public Distribution Scheme and Other Welfare Schemes (OWS), Food Corporation of India (FCI) on the instructions from the Government, sells wheat and rice in the open market from time to time.
• For transparency in operations, the FCI has switched over to e- auction for sale under Open Market Sale Scheme (Domestic).
• The FCI conducts a weekly auction to conduct this scheme in the open market using the platform of commodity exchange NCDEX (National Commodity and Derivatives Exchange Limited).
• The State Governments/ Union Territory Administrations are also allowed to participate in the e-auction, if they require wheat and rice outside TPDS and OWS.

The present form of OMSS comprises 3 schemes as under:

• Sale of wheat to bulk consumers/private traders through e-auction.
• Sale of wheat to bulk consumers/private traders through e-auction by dedicated movement.
• Sale of Raw Rice Grade ‘A’ to bulk consumers/private traders through e-auction.

About Food Corporation of India:

• Food Corporation of India (FCI) is a Public Sector Undertaking, under the Department of Food and Public Distribution, Ministry of Consumer Affairs, Food and Public Distribution.
• FCI is a statutory body set up in 1965 under the Food Corporations Act 1964.
• It was established against the backdrop of major shortage of grains, especially wheat.
• Simultaneously, Commission for Agricultural Costs and Prices (CACP) was created in 1965 to recommend remunerative prices to farmers.
• It has primary duty to undertake purchase, store, move/transport, distribute and sell food grains and other foodstuffs.
• FCI coordinates its functions through a country-wide network of offices with Headquarters at New Delhi with five Zonal Offices, twenty-five Regional Offices and 170 District Offices under its control.

Source: NewsOnAir