CHANDIGARH – Prices of new varieties of basmati — PUSA 1121 and PUSA 1509 — have had a free fall, sending the farmers and state Agriculture Department in a tizzy.
With the price falling much below the price of non-basmati varieties, the state government is likely to enter the market to salvage the basmati growers by offering to withdraw certain taxes.
This year, PUSA 1121 is getting Rs2,000 per quintal for farmers and the recently introduced basmati variety PUSA 1509 is fetching the growers just Rs950 to Rs1,200 per quintal.
Comparatively, the price of non-basmati paddy —which is procured on a minimum support price — is fetching growers Rs 1,450 per quintal.
The reason for low basmati prices in India is that prices in the export market have fallen drastically – from $1,800 three years ago to $650 to $700 now. This is because exporters have been selling their basmati on direct advance to West Asian buyers and now their payments have been stuck, mostly in Iran.
In the wake of this and fall in basmati exports, the prices in local markets have taken a beating.
Sources in the state Agriculture Department have told The Tribune that considering the seriousness of the issue, a meeting was held between Chief Minister Parkash Singh Badal and Agriculture Minister Tota Singh yesterday, wherein the poor price fetched by basmati and its impact on the already stretched rural economy because of successive poor returns fetched by farmers on almost all crops — wheat, cotton, sugarcane and now basmati — since last year was discussed.
Agriculture Minister Tota Singh said the government was apprised of the grave situation and necessary steps were being initiated to salvage the situation. “We have also called a meeting with the arhitiya association (commission agents) and rice industry tomorrow to discuss the way forward,” he said.
