Thiruvananthapuram: The revision in prices of the subsidized commodities in the Supplyco outlets was done to ensure the continued operation of these retail supermarkets, said Kerala Minister for Food and Civil Supplies, GR Anil. 

The adjustment marks the first change since 2014, as prices were maintained untouched during the tenure of the first Left Democratic Front (LDF) government. 

Minister Anil highlighted that prices remained stable during the first two years of the second Pinarayi Vijayan administration, contrasting with the previous United Democratic Front (UDF) government, which had increased prices on four occasions.

Even when the last price hike came into effect, the prices were still 26 per cent below the open market rates. Now, the prices have been kept down 35 per cent from open market rates. This means the consumer who buys essentials for Rs 1,447 would be able to get them for Rs 933 from Supplyco outlets. This amounts to a subsidy of Rs 514, the minister said. 

The state government has been able to keep prices at this level despite frequent increases in fuel prices, which spur inflation, thereby hiking the price of essential commodities, Anil added.

According to the minister, when subsidies are provided, Supplyco incurs monthly losses of Rs 35 crore. Annually, the additional expenditure incurred by Supplyco on this count is Rs 420 crore.

The government had intervened through Supplyco in times of crises like two floods and the COVID-19 pandemic to ensure essential supplies to the common man, putting a huge burden on the company. 

The union government, on its part, sought a refund of the Rs 205.81 crore it spent on rice during Covid from the state government, which had to repay it. The Supplyco’s market intervention had bled its coffers to the tune of Rs 1,526 crore of which Rs 347 crore were the arrears during the UDF regime.

As the government, which is battling a severe financial crisis, cannot fully refund the entire losses suffered by Supplyco, the prices of essentials had to be revised, the minister clarified.