The central government on Monday advised the rice industry to ensure that the retail price of cereal is reduced with immediate effect.

To review the domestic price scenario of non-basmati rice, Department of Food and Public Distribution secretary Sanjeev Chopra convened a meeting today in New Delhi with the rice processing industry representatives.

"The rice industry needs to ensure that the prices in the domestic market need to be brought down to optimal levels and efforts at profiteering dealt with strictly," the Centre says.

The directive comes at a time when domestic prices of rice are increasing despite a good crop this Kharif season, ample stocks with FCI (Food Corporation of India ) and various regulations in place on rice exports.

The annual inflation rate of rice has been hovering around 12% for the past two years and is cumulating over the years, which is a cause of concern, the Ministry of Consumer Affairs, Food & Public Distribution says.

In July, India banned the export of non-basmati white rice – a variety that contributes 25% to the country's rice exports.  The export curbs were expected to soften rice prices for Indian consumers. India is the biggest exporter of rice in the world.

"During the meeting, it was discussed that the benefit of lower prices has to be passed on expeditiously to the end consumers. The leading rice industry associations were advised to take up the issue with their members and ensure that the retail price of rice is reduced with immediate effect," the food ministry says.

"There are reports of a sharp increase in the margins being availed by wholesalers and retailers which needs to be tempered. Besides, it was suggested that where there exists a wide gap between the MRP and actual retail price, the same needs to be brought down to a realistic level in order to safeguard the interest of the consumers," it explains.

Government-run FCI informed the rice processing industry that sufficient stock of good quality rice is available which is being offered under OMSS (Open Market Sale Scheme) at a reserve price of ₹29/Kg. It was also suggested that manufacturers and traders may consider lifting FCI rice under OMSS which may be sold to the consumers with a reasonable margin.

The Department of Food & Public Distribution closely monitors and reviews the prices of Rice in the country and steps in whenever any intervention is required to ensure the affordability of Rice which forms an important part of the diet.

"The Indian consumers thus can expect to pay less for rice in the coming days," the ministry says.

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