Hyderabad: The government is planning to introduce a new policy for the delivery of Custom Milling Rice (CMR). However, rice millers are opposing one major part of the policy, which requires them to provide a ‘bank guarantee’ as a precondition for getting paddy.
The new policy includes detailed guidelines for the procurement of paddy and the delivery of CMR. One of the main rules that millers are against is the requirement to provide a bank guarantee that equals 25% of the value of the paddy they are allocated. Rice millers argue that this rule would hurt their business. “Millers are not ready for this because it will cause huge losses. The 25% bank guarantee will severely affect our operations, and the guidelines do not address other technical issues in the tender process,” said B Bhaskar, a leader of a Rice Millers Association in the State.
In the past, this bank guarantee was not needed to get CMR work done. However, the current government is introducing this rule because some millers have delayed the delivery of CMR for more than a year, leading to losses for the State. Other states, such as West Bengal, Andhra Pradesh, and Odisha, have already implemented similar measures. Even the Comptroller Auditor General of India (CAG) recommended this policy many years ago, saying it serves as ‘collateral security’ to protect the government from millers who do not deliver the rice on time.
Another important condition in the new guidelines is that only mills with blending or sortex machines will be allowed to process fortified rice for the Food Corporation of India (FCI) or the Civil Supplies Corporation. The deadline for mills to install these machines is set for December 31.
In addition, on October 16, after a meeting of the cabinet sub-committee on paddy procurement, it was decided that millers who have defaulted on the delivery of CMR will not receive any paddy allocations for the current Kharif season. The committee stressed that these strict measures are necessary to ensure accountability.
