What are the implications of discontinuing sale of rice and wheat to states under OMSS

Discuss the move by the center to discontinue the sale of rice and wheat to states under OMSS and its impact on the prices of these commodities.
The central government has decided to discontinue the sale of rice and wheat to states under OMSS (Open Market Sale Scheme). This move can have significant implications, and some of them are:
  • The prices of these commodities may increase due to a decrease in the supply of rice and wheat in the market.
  • Some states that were dependent on buying rice and wheat under OMSS may find it challenging to meet their requirements and have to buy them at higher prices from the open market.
  • In the long run, this move can encourage state governments to focus on increasing their agricultural production and reducing their dependence on the central government for procurement.
  • The central government can save some money by discontinuing this scheme, which can be used for other developmental activities.
The impact of this move is likely to be felt differently by different states, depending on their dependence on the scheme and their agricultural production capacity. Nevertheless, it highlights the need for effective policy interventions to address the issues of agricultural production, procurement, and distribution, which are critical for ensuring food security and rural livelihoods.
Answered a year ago
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