The Government on Wednesday said it would not hesitate to regulate prices of food commodities as it expects rice production to fall by 10 million tonnes due to a weak monsoon this year.

“In the wake of expectations of reduced production of rice and wheat, the government will not hesitate to undertake open market intervention and release wheat and rice under the Open Market Sale Scheme to the state governments,” said the Agriculture Minister Sharad Pawar at a conference of state food ministers here.

According to Mr. Pawar, the total area under paddy cultivation could come down by about 5.7 million hectares.

Raising concerns about a shortage in sugar supply, he said: “We are also looking at increasing the percentage of levy sugar to make it more (easily) available through the public distribution system.”

The government, Mr. Pawar said, was also contemplating raising the quantity of sugarcane that mill owners have to sell to the government at regulated rates. Currently, the mills are required to sell 10 percent of their output.

According to government data, the sugar stocks dropped to six million tonnes July 31, down 21 per cent from the stocks available June 30.

India is the world’s second largest sugar manufacturer after Brazil, and the news that Indian production would be low this year has already sent world prices to a 28-year high.

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