The State, which ranks seventh in the infrastructure development index in the country, is facing severe shortage of warehousing capacity for storage of foodgrains.

In 2012-13, the demand for storage capacity in the State was 19.48 lakh tonnes, while the storage capacity was 13.24 lakh tonnes, leaving a gap of 6.24 lakh tonnes. The State requires an additional storage capacity of 2.18 million tonnes for public distribution system (PDS) and non-PDS commodities by 2016-17. The investment required to build the capacity has been estimated at Rs. 1,077 crore.

A study on “Warehousing in Karnataka: assessment of gap and potential (2014)” by National Bank for Agriculture and Rural Development (NABARD) has revealed that the effective storage capacity for PDS commodities in the State was only 1.05 million tonnes in 2012-13, against the total requirement of 1.94 million tonnes.

NABARD has been encouraging private sector investment in warehousing. “We are ready to give as much funds as the State government requires,” said G.R. Chintala, chief general manager, NABARD.

He said that the strategic locations for the storage of PDS commodities would be at the taluk/hobli level. Major commodities considered for storage were rice, wheat, coarse cereals, pulses and oilseeds.

The study was conducted in eight districts — Mysore, Shimoga, Davangere, Dakshina Kannada, Bijapur, Raichur, Gulbarga and Bellary — to understand different operational issues relating to warehouses and farmers’ participation in storage of agricultural produce.

“Warehouses built before 2000 were not constructed scientifically, and they are not capable of preventing rodent entry and fire accidents,” the study said.

For non-PDS commodities, the State had surplus storage capacity in 2012-13. Based on the past trend, the study has projected that by 2016-17, the State required an additional storage capacity of 2.18 million tonnes, of which 1.79 million tonnes will be PDS commodities and 3,85,000 tonnes non-PDS commodities.

Reach of PACS

“As storage and distribution of PDS commodities are critical factors for reducing poverty and inequality, the government may take suitable initiatives for the construction of additional warehouses for the storage of PDS commodities. Keeping in view the wide reach of PACS (Primary Agriculture Cooperative Societies), it appears prudent to explore the possibility of expanding the storage capacity through PACS,” Mr. Chintala said.

PACS may also explore the possibility of extending pledge loan to farmers. However, the resource base, local demand for storage and other requisite capabilities with PACS need to be examined before taking such a decision. Distress sale of produce would decline, once PACS start giving pledge loan based on stocks in godowns, the study said.

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