Govt needs to have its finger on the 'pulse' of black marketers

Raveena Singhmoneycontrol.comFor pulses hoarders, it doesn't get any worse. The Maharashtra government today announced that it was going to enact a law fixing a maximum cap on the prices of the kitchen staple. Hopefully, this latest move would put an end to the illegal hoarding of pulses that has been raging on for some time now. And the government hasn’t been sitting idle either.Last Thursday, the Income Tax (I-T) department raided pulses traders in Indore and Mumbai and filed prosecution cases against them for artificially hiking prices.This development comes after the government, committed to tackling the after-effects of two consecutive drought years, took notice of dal (urad, tur, chana) prices moving northwards. While several essential kitchen staples have shown moderation in rates since the crackdown, prices of pulses still went up by 34 percent in March over the year-ago period. In November last year, tur dal was trading at over Rs 200 per kilogram. Two things contributed to it. One, poor monsoon led to lesser sowing of pulses, and two, traders were stocking up on supplies. And this was despite the fact that over 35,000 tonnes of pulses had been seized from 10 states after state governments implemented stricter measures to tidy up the pulses black market last October.However, raiding alone would not be enough to put an end to the hoarding menace. And, no half-hearted attempts would do either. After the raid last year, the Maharashtra government decided to auction the seized stocks back to the traders. This would only have returned the hoarded pulses to a market where the pulses, according to the government, were artificially inflated by the traders. The problem that grips the country, one that is heavily dependent on pulses, remains low agricultural productivity as sowing is largely undertaken on un-irrigated lands.Hence, the government, as pointed out in the Macro Economic Survey 2016-17, will not only have to ensure a favourable minimum selling price (MSP) for the farmers, but it will also have to release funds to incentivise them wherever needed.