The Punjab government is in middle of decision to allow traders from outside to lift the basmati crop. A conference with the merchants from Haryana was held and they insisted tax releases on parity with the traders in Punjab. While the Punjab traders in the conferences earlier carried that it would be unfair of state government to permit tax discharges to traders from outside.

Agriculture minister Tota Singh said, “When we knew that area under basmati cultivation had increased and production was going to be an all time high, we should have taken steps on lifting much earlier.”

Fronting resistance from the Punjab merchants, the state government says traders in Haryana proposed better rate Rs. 3,200 to 3,500 per quintal for stimulating the basmati, although the Punjab dealers proposed a exciting rate of up to Rs. 2,500 per quintal, on which Tota Singh added  “So why not invite Haryana traders as we want more buyers for our crop so that the rate gets a boost.”

Whole basmati production of 22 lakh tonne beside last kharif season’s is expected to dash 35 lakh tonne. Total basmati in the state is expected to be worth Rs.12,000 crore, while traders in the state have the ability to lift crop worth Rs. 5,500 crore.

In the previous season, Punjab traders were given a tax exemption of about 11%, which included 2% market fee, 2% rural development fund, 3% infrastructure development tax and 4% purchase tax. But, there was no exemption for traders from other states.

The state government is forecasting to levy 1% each as market fee and rural development fund on Punjab traders. Punjab is arranging a offer to impose taxes on Haryana farmers on par with their home state. Punjab plans to impose Haryana traders 2% each as rural development fund and market fee, 2% as central sales tax and 1% infrastructure development cess and give exemption from paying 5% VAT.

Basmati production expected to touch all time high of 35 lakh tonne in Punjab, and the state is not geared to procure and process the crop. So it decided to involve traders from Haryana to bring in more buyers for the basmati produce.

Notwithstanding obstruction from the state traders, state will simplify traders from outside, particularly Haryana, as they offer higher price for basmati, more buyers for basmati processes better price. With outside traders approaching in to boost crop, Punjab is assuming higher price for basmati.