With the introduction of negotiable warehouse receipts system, there would be following advantages: -
Increased liquidity in rural areas.
Encouragement of scientific warehousing of goods.
Lower cost of financing.
Shorter and more efficient supply chains.
Enhanced rewards for grading and quality.
Better price risk management.
Higher returns to farmers and better services (quality) to the consumers.
Brief note on achievements of Warehousing Development and Regulatory Authority during 2011
For the first time in the country, the Government of India had introduced a negotiable warehouse receipt system in the country by enacting the Warehousing (Development and Regulation) Act, 2007 from 25th October, 2010. As per the provisions of the Act, the Warehousing Development and Regulatory Authority (WDRA) had been setup by the Government from 26th October, 2010.
The important achievements of WDRA during 2011 are as follows:
1. Notification of Agricultural Commfies for Negotiable Warehouse Receipt: Initially the Authority had approved 40 agricultural commodities including cereals, pulses, oil seeds and spices to be notified for issuing Negotiable Warehouse Receipts. Most of these commodities have been approved by various commercial banks for loan against pledge to the farmers. Further, 75 more agricultural commodities including cereals, pulses, oilseeds, vegetable oils, spices, edible nuts and miscellaneous items like rubber, tobacco, tea coffee and makhana have also been approved for issuance of NWRs.
2. Finalization of format of Negotiable Warehouse Receipt: The format of Negotiable Warehouse Receipts has been finalized by the Authority in consultation with Indian Banks’ Association (IBA), warehousemen and banks and the Negotiable Warehouses Receipt books have been issued to the registered warehouses. The Negotiable Warehouse Receipt has unique features such as Anti copy, endless text, fine line patterns micro printing with rainbow coloring.
3. Receipt of Application from Warehouses for Registration: for commodity such a Turmeric, Raw Cashew Nut, Paddy, Chillies, Green Gram, Maize, Barley, Rice, Wheat and Pulses etc. 40% of NWRs have been financed by commercial and co-operative banks. PNB and Urban Co-operative Bank have taken lead in this regard.
4. Regional Conferences: Regional conferences in association with FICCI, ASSOCHAM and PHD Chamber have been organised at New Delhi, Chandigarh, Bangalore, Thiruvanathapuram and Mumbai by the WDRA to create awareness about the negotiable warehouse receipt system the country.
5. Awareness programme for farmers: Awareness programmes for farmers in collaboration with CWC In additions to this IGMRI and NIAM have also organised awareness programmes, training farmers in UP and Rajasthan.
6. Training programme for warehouse manager: A 5 day training programme for warehouse managers of CWC, RSWC and private warehouses has also been organised at NIAM.
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7. Rural Godown Scheme (RGS): The RGS scheme has been revised as follows:
For godowns up to 1000 tonnes capacity- Project cost as appraised by financing Bank or actual cost or Rs. 3,500/- per MT of storage capacity, whichever is lower. For godowns exceeding 1000 MTs capacity- Project cost as appraised by Bank or actual cost or Rs. 3,000/- per MT of storage capacity, whichever is lower. For NE region/hilly areas, normative cost will be Rs. 4,000/- per MT or as appraised by bank/financial institution, whichever is lower irrespective of godown capacity. However, the revised cost estimates would need to be based on the rates of CWC and CPWD, wherever applicable.For godowns exceeding 30,000 MTs capacity (25,000 MTs for the NE States, Sikkim and hilly areas), the subsidy would be restricted to that admissible for capacity of 30,000 MTs (25,000 MTs for the NE States, Sikkim and hilly areas) only, excluding the cases of cooperatives. For renovation of godowns by cooperatives with assistance from NCDC- Project cost as appraised by Bank/NCDC or actual cost or Rs. 750/- per MT of storage capacity, whichever is lower.
8. RIDF Scheme: The scheme has opened up for the first time for private sector in the country. An allocation of Rs. 2000 crores has been announced by the Government of India for the setting up of warehousing infrastructure in the country under the scheme for Financing Warehousing Infrastructure under Rural Infrastructure Development Fund (RIDF). Loans to Government entities and private sector would be given for the construction of warehouses, @ 8% with rebate of 1.5% for timely payment of the loan.
9. Extension of Crop Loan Facility with interest subvention to Post – harvest loan on NWRs to Farmers: At present concessional crop loan @7% with interest rate subvention is available to farmers as pre-harvest loan. In case of post-harvest loan against the negotiable warehouse receipts, the farmers are granted loan at commercial rates. In order to discourage distress sale of agriculture produce by farmers and to encourage them to store their produce in warehousing against the warehouse receipt, the benefit of interest subvention has been extended to small and marginal farmers having Kisan Credit Card (KCC) for a further period of up to six months post-harvest on the same rate as available to crop loan against negotiable warehouse receipt for keeping their produce in the warehouses.
10. Working Group on Warehousing Development & Regulation for the 12th Plan Period (2012-17): The Planning Commission constituted a Working Group on Warehousing Development & Regulation for the 12th Plan Period (2012-17) on 18th July, 2011 under the Chairmanship of Chairman, WDRA with representatives from Department of Agriculture and Cooperation, Food and Public Distribution, Department of Financial Services, FCI, CWC, Banks, KSWC and NCMSL to suggest the approach towards orderly growth of the warehousing business and regulation thereof during the 12th Plan Period. The Working Group has submitted its report to the Planning Commission on the 12th Oct, 2011. Some of the important recommendations like revamping of Rural Godown Scheme, extension of crop loan facilities to the post-harvest loan on NWRs, allowing RIDF funding to Private parties for construction of warehouses have already been implemented by the Government.
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11. Infrastructure status to post-harvest storage and cold chain sectors: The Authority directly and through Planning Commission has taken up issue of according infrastructure status to post-harvest storages and cold chain sectors. Thereafter, the Committee of Secretaries (COS) has taken a decision to accord infrastructure status to post-harvest storage and cold chain. This will boost the development of warehousing and cold storages in the country.
12. Introduction of NWR system in cold storages: The WDRA in consultation with National Horticulture Mission (NHM) and National Horticulture Board (NHB) is soon going to introduce the NWR system in cold storages so that the growers /farmers producing horticulture produce may store these commodities in cold storages and may avail the benefits of loan on NWRs issued by the registered cold storages. Perishable commodities such as Potato, Dehydrated Onion, Garlic, Ginger, Turmeric, Apple and Resins etc. are being notified.
13. Integration of PACs with NWR: The WDRA plans to integrate the primary Agriculture Credit Societies (PACS) warehouses under the negotiable warehouse receipt system so that the small and marginal farmers may get benefited from this scheme. The WDRA has requested NABARD to chalk out a detailed programme in this regard. The Maharashtra State Warehousing Corporation (MSWC) has also a plan to link PACs godown with larger capacity MSWC warehouses for introducing the electronic negotiable warehouse receipt in their warehouses. It has requested to relax the accreditation norms for these warehouses and also for exemption of accreditation and registration money. The matter is examined in the WDRA.
Authority had been able to achieve some of these goals in the short period of one year and stands committed to outperform in due course.
Increased liquidity in rural areas.
Encouragement of scientific warehousing of goods.
Lower cost of financing.
Shorter and more efficient supply chains.
Enhanced rewards for grading and quality.
Better price risk management.
Higher returns to farmers and better services (quality) to the consumers.
Brief note on achievements of Warehousing Development and Regulatory Authority during 2011
For the first time in the country, the Government of India had introduced a negotiable warehouse receipt system in the country by enacting the Warehousing (Development and Regulation) Act, 2007 from 25th October, 2010. As per the provisions of the Act, the Warehousing Development and Regulatory Authority (WDRA) had been setup by the Government from 26th October, 2010.
The important achievements of WDRA during 2011 are as follows:
1. Notification of Agricultural Commfies for Negotiable Warehouse Receipt: Initially the Authority had approved 40 agricultural commodities including cereals, pulses, oil seeds and spices to be notified for issuing Negotiable Warehouse Receipts. Most of these commodities have been approved by various commercial banks for loan against pledge to the farmers. Further, 75 more agricultural commodities including cereals, pulses, oilseeds, vegetable oils, spices, edible nuts and miscellaneous items like rubber, tobacco, tea coffee and makhana have also been approved for issuance of NWRs.
2. Finalization of format of Negotiable Warehouse Receipt: The format of Negotiable Warehouse Receipts has been finalized by the Authority in consultation with Indian Banks’ Association (IBA), warehousemen and banks and the Negotiable Warehouses Receipt books have been issued to the registered warehouses. The Negotiable Warehouse Receipt has unique features such as Anti copy, endless text, fine line patterns micro printing with rainbow coloring.
3. Receipt of Application from Warehouses for Registration: for commodity such a Turmeric, Raw Cashew Nut, Paddy, Chillies, Green Gram, Maize, Barley, Rice, Wheat and Pulses etc. 40% of NWRs have been financed by commercial and co-operative banks. PNB and Urban Co-operative Bank have taken lead in this regard.
4. Regional Conferences: Regional conferences in association with FICCI, ASSOCHAM and PHD Chamber have been organised at New Delhi, Chandigarh, Bangalore, Thiruvanathapuram and Mumbai by the WDRA to create awareness about the negotiable warehouse receipt system the country.
5. Awareness programme for farmers: Awareness programmes for farmers in collaboration with CWC In additions to this IGMRI and NIAM have also organised awareness programmes, training farmers in UP and Rajasthan.
6. Training programme for warehouse manager: A 5 day training programme for warehouse managers of CWC, RSWC and private warehouses has also been organised at NIAM.
Cont-2-g
-2-
7. Rural Godown Scheme (RGS): The RGS scheme has been revised as follows:
For godowns up to 1000 tonnes capacity- Project cost as appraised by financing Bank or actual cost or Rs. 3,500/- per MT of storage capacity, whichever is lower. For godowns exceeding 1000 MTs capacity- Project cost as appraised by Bank or actual cost or Rs. 3,000/- per MT of storage capacity, whichever is lower. For NE region/hilly areas, normative cost will be Rs. 4,000/- per MT or as appraised by bank/financial institution, whichever is lower irrespective of godown capacity. However, the revised cost estimates would need to be based on the rates of CWC and CPWD, wherever applicable.For godowns exceeding 30,000 MTs capacity (25,000 MTs for the NE States, Sikkim and hilly areas), the subsidy would be restricted to that admissible for capacity of 30,000 MTs (25,000 MTs for the NE States, Sikkim and hilly areas) only, excluding the cases of cooperatives. For renovation of godowns by cooperatives with assistance from NCDC- Project cost as appraised by Bank/NCDC or actual cost or Rs. 750/- per MT of storage capacity, whichever is lower.
8. RIDF Scheme: The scheme has opened up for the first time for private sector in the country. An allocation of Rs. 2000 crores has been announced by the Government of India for the setting up of warehousing infrastructure in the country under the scheme for Financing Warehousing Infrastructure under Rural Infrastructure Development Fund (RIDF). Loans to Government entities and private sector would be given for the construction of warehouses, @ 8% with rebate of 1.5% for timely payment of the loan.
9. Extension of Crop Loan Facility with interest subvention to Post – harvest loan on NWRs to Farmers: At present concessional crop loan @7% with interest rate subvention is available to farmers as pre-harvest loan. In case of post-harvest loan against the negotiable warehouse receipts, the farmers are granted loan at commercial rates. In order to discourage distress sale of agriculture produce by farmers and to encourage them to store their produce in warehousing against the warehouse receipt, the benefit of interest subvention has been extended to small and marginal farmers having Kisan Credit Card (KCC) for a further period of up to six months post-harvest on the same rate as available to crop loan against negotiable warehouse receipt for keeping their produce in the warehouses.
10. Working Group on Warehousing Development & Regulation for the 12th Plan Period (2012-17): The Planning Commission constituted a Working Group on Warehousing Development & Regulation for the 12th Plan Period (2012-17) on 18th July, 2011 under the Chairmanship of Chairman, WDRA with representatives from Department of Agriculture and Cooperation, Food and Public Distribution, Department of Financial Services, FCI, CWC, Banks, KSWC and NCMSL to suggest the approach towards orderly growth of the warehousing business and regulation thereof during the 12th Plan Period. The Working Group has submitted its report to the Planning Commission on the 12th Oct, 2011. Some of the important recommendations like revamping of Rural Godown Scheme, extension of crop loan facilities to the post-harvest loan on NWRs, allowing RIDF funding to Private parties for construction of warehouses have already been implemented by the Government.
-3-
11. Infrastructure status to post-harvest storage and cold chain sectors: The Authority directly and through Planning Commission has taken up issue of according infrastructure status to post-harvest storages and cold chain sectors. Thereafter, the Committee of Secretaries (COS) has taken a decision to accord infrastructure status to post-harvest storage and cold chain. This will boost the development of warehousing and cold storages in the country.
12. Introduction of NWR system in cold storages: The WDRA in consultation with National Horticulture Mission (NHM) and National Horticulture Board (NHB) is soon going to introduce the NWR system in cold storages so that the growers /farmers producing horticulture produce may store these commodities in cold storages and may avail the benefits of loan on NWRs issued by the registered cold storages. Perishable commodities such as Potato, Dehydrated Onion, Garlic, Ginger, Turmeric, Apple and Resins etc. are being notified.
13. Integration of PACs with NWR: The WDRA plans to integrate the primary Agriculture Credit Societies (PACS) warehouses under the negotiable warehouse receipt system so that the small and marginal farmers may get benefited from this scheme. The WDRA has requested NABARD to chalk out a detailed programme in this regard. The Maharashtra State Warehousing Corporation (MSWC) has also a plan to link PACs godown with larger capacity MSWC warehouses for introducing the electronic negotiable warehouse receipt in their warehouses. It has requested to relax the accreditation norms for these warehouses and also for exemption of accreditation and registration money. The matter is examined in the WDRA.
Authority had been able to achieve some of these goals in the short period of one year and stands committed to outperform in due course.
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