Why is Punjab CM Asking for the Release of Rs 9,000 Crore from the Rural Development Fund?

New Delhi, July 16 (NationPress) The Chief Minister of Punjab, Bhagwant Mann, on Wednesday appealed to the Union Food Minister, Pralhad Joshi, for the release of the state’s overdue share exceeding Rs 9,000 crore related to the Rural Development Fund (RDF) and Market Fees.

During a discussion at the residence of the Union Minister, the Punjab CM highlighted the issue of the non-release of RDF since the 2021-22 fiscal year and the inadequate allocation of market fees since 2022-23.

He underscored that the primary goal of RDF is to enhance agriculture and rural infrastructure, which includes the development of rural roads, marketing facilities, storage capabilities in mandis, as well as automation and mechanization efforts in these areas. Despite modifying the Punjab Rural Development Act, 1987 to align with the guidelines of the Department of Food and Public Distribution (DFPD), the RDF has remained unreleased since 2021-22.

The Chief Minister pointed out that Rs 7,737.27 crore under RDF and Rs 1,836.62 crore under Market Fees are still pending from the central government.

Mann noted that this lack of reimbursement has significantly hindered the development and upkeep of rural infrastructure and adversely affected the rural economy.

He mentioned that the Mandi Board and Rural Development Board are facing difficulties in repaying loans, maintaining existing infrastructure, and establishing new facilities for rural development.

In light of these challenges, Mann urged the Union Minister to expedite the release of the outstanding funds in the interest of the public.

The Chief Minister also pointed out the ongoing shortage of covered storage space in the state over the past two years.

During the 2023-24 period, this shortage resulted in extending the delivery timeline for milled rice until September 30, 2024.

Mann expressed that this issue raised concerns among millers during the last Kharif season, causing initial hesitation in their willingness to lift and store paddy; however, this was later resolved with cooperation from both state and central authorities.

For the 2024-25 season, out of 117 LMT (lakh metric tonnes) of rice designated for delivery to the FCI, only approximately 107 LMT had been delivered by June 30, 2025, leaving 10 LMT still outstanding.

Mann stated that merely 80 LMT of rice has been transported out of the state in the last 12 months, averaging 6.67 LMT monthly. Although the FCI aimed to transport 14 LMT in June 2025, only 8.5 LMT was actually lifted.

The Chief Minister emphasized the necessity for the movement of at least 15 LMT of rice in July to ensure that milling is completed by July 31.

He warned that delays might incite unrest among millers and impede paddy procurement for 2025-26. Given the storage constraints, Mann requested ongoing allocation of rice to bio-ethanol manufacturing units at reasonable prices, liberal lifting under OMSS, rice exports, and other avenues.

The Chief Minister highlighted that the state is projected to store around 145-150 LMT of rice by the conclusion of 2024-25, and to accommodate an additional 120 LMT anticipated in 2025-26, Punjab requires a consistent movement of 10-12 LMT monthly to guarantee at least 40 LMT of available space by December.

To optimize storage, he urged the Union Minister to take a proactive stance in identifying, approving, and leasing covered godowns. Mann suggested implementing a strategy to convert covered godowns from wheat to rice to free up seven LMT of capacity for rice storage in 2025-26, advocating that this model should be adopted nationwide to alleviate space shortages.