The Reserve Bank of India (RBI) has urged the government to take steps to arrest falling prices of pulses triggered by a supply glut.
Prices of pulses prices, specially tur, have fallen sharply to below the government-mandated minimum support price of Rs 5,050 per quintal due to a record crop this year.
“The prices of pulses are clearly reeling under the impact of a supply glut caused by record output and imports. Policy interventions, including access to open trade, may be envisaged to arrest the slump in prices,” the RBI said in its latest bi-monthly policy statement.
Supply of pulses has risen sharply because of expansion in acreage last year, imports and buffer stocking after two straight years of drought created a huge shortfall in the country and sent prices soaring.
The government has created a bufer stock of about 2 million tonnes of pulses, of which more than 1.6 million tonnes of pulses has been brought directly from local farmers.
Pulses output is estimated to be a record 22.40 million tonnes in the 2016-17 crop year ending June, as against 16.35 MT previous year, on account of good monsoon, higher MSP and procurement arrangement, according to the agriculture ministry.