Kerala’s state government has announced a significant policy shift that will impact the pricing of 13 essential items sold through Supplyco outlets, potentially affecting the daily lives of the common people. Under the new policy, the government will provide subsidies of up to 35% of the open market rates, resulting in changes to the prices of these essential goods based on market fluctuations.
The decision, made by the state cabinet, marks a departure from the fixed-rate system introduced in 2016 to curb price hikes. Instead, the government has reverted to the subsidy rate system that was in place before 2016. Initially, the Left government in 2016 had opted to maintain stable prices for essential items to combat inflation by fixing rates at 26% less than market prices prevailing in 2014. However, faced with significant market price increases, the cabinet approved the policy change.
The decision to raise prices of essential items through Supplyco outlets sparked controversy in the assembly, with the Leader of Opposition criticizing the government’s lack of transparency in announcing the decision. However, Civil Supplies Minister G R Anil defended the move, stating that consumers would still benefit from significant subsidies, with the specified 13 items priced at Rs 940 at Supplyco outlets compared to Rs 1,446 in the open market. He emphasized the need for a sustainable subsidy mechanism to address Supplyco’s financial burden, which currently amounts to Rs 425 crore annually due to market intervention measures.
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