THE WAREHOUSING CORPORATIONS (AMENDMENT) BILL, 2015
Even after 68 years of Independence India suffers from high levels of malnutrition and chronic hunger. Food Security and Public Distribution System
are important weapons in tackling these problems. For an efficient and effective Food Security and PDS, a well developed network of Warehouses is
therefore crucial. As the Bill constrains the ability of the Warehouse Corporations to borrow, the current government is obstructing the
expansion of public sector warehouses in India at a time when it needs to be expanded.
The removal of Central/State government as a sovereign guarantor for Warehousing Corporations limits their potential to access capital investments,
thus hampering their expansion. This would create a vacuum which will in all likelihood be filled in by the Private sector. The private sector will
obviously be driven by motives of profit and revenue maximisation and a larger role of the private sector will drive up the costs of renting
warehouses, making them inaccessible to a majority of farmers in India. This would in turn drive up input costs of food items resulting in higher food
inflation. The pro-market initiatives sought by the current government will burden the common man and have a detrimental effect on the poor and
In fact as per M.S. Jairath, director National Institute of Agricultural Marketing, Rajasthan, the total storage capacity available at the end of 2010 for
CWC, SWC and FCI is about 75 million tonnes. Keeping in view the agricultural production of the country the available storage capacity is
insufficient and assuming current production trends an additional capacity of 150 MTs is needed (refer Table1 IN Annexe). As the warehousing
capacity of most states is dismally below the national average, the 2011 Bill of the UPA government rightly suggested that states need be more
proactive. But, the present amended bill of the NDA government removes the role of both the central and state government and is an attempt to create
space for private entities in the warehousing arena.