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What is the impact of discontinuing the sale of rice and wheat on price rise in States under OMSS

The Centre has checked price rise by discontinuing the sale of rice and wheat to States under OMSS. Evaluate the impact of this move.
The government decision to discontinue the sale of rice and wheat to states under OMSS has significant impact on the price rise. Here are some of the key factors which have fueled this impact:
  • The decision to stop the sale has resulted in a rise in demand for rice and wheat in the open market. As a result, prices surged due to scarcity and increased demand.
  • This also led to a surge in the prices of rice and wheat in various states, especially those that relied heavily on this program by the government.
  • There has been an overall increase in the prices of these grains due to the increase in transportation costs, storage costs, and market speculation on the shortage of supply.
  • Since the discontinuation of the sale, some state governments have also been left without food supplies, leading to further price increase.
  • This decision is also likely to impact the overall prices of staple food items, and may trigger an inflationary trend in the economy.
In conclusion, the decision to discontinue the sale of rice and wheat to States under OMSS has created a situation of shortage of supply and has led to a surge in prices.
Answered 2 years ago
Amrita Aspirants