Telangana: Now, bank guarantee must for millers receiving paddy

By Roushan Ali

The state govt has decided to make bank guarantee mandatory for millers to prevent them from selling the paddy given to them for custom milling.

The state cabinet meeting two days ago approved the bank guarantee clause for rice millers. This was earlier opposed by millers during talks with officials and later with the cabinet sub-committee headed by deputy CM Mallu Bhatti Vikramarka.

But officials claimed to have convinced them that a bank guarantee was necessary, considering that 2,500 crore worth of paddy given for custom milling rice was sold by some rice millers in the past.

As per the new rule, millers have been divided into three categories. First, the millers who have never defaulted will have to pay for only 10% of the total paddy given to them as a bank guarantee or security deposit.

The second category of millers are those who have defaulted but returned the custom milled rice along with the penalty. They need to deposit 20% of the value as a bank guarantee.The third category of millers have been defined as those who defaulted but returned the rice later without paying the penalty. Such millers would need to make a bank guarantee of 25%.”We have decided not to give paddy to millers who defaulted and did not give the custom milled rice back to the govt,” Civil supplies chairman DS Chouhan told TOI.

The bank guarantee would be returned to the millers after return of the custom milled rice to the Food Corporation of India (FCI) and the Civil Supplies Corporation.

Earlier, millers were providing rice to FCI as per its specifications and dumping lesser quality rice with the corporation. Consequently, it has now been made mandatory for rice millers to follow a 2:1 ratio, i.e., for every two bags of rice given by millers to the FCI they have to supply one bag to the corporation. This has resulted in quality of rice being delivered to the corporation, he said.

This article has been republished from The Times of India