Despite record central-pool stocks, India repeatedly resorts to stock limits and disclosure orders. Examine the efficacy of supply-side versus regulatory tools in controlling cereal inflation.

In July 2025, India's central pool held 377.83 LT of rice against a buffer norm of 135.40 LT, nearly 2.8 times the requirement [2]. Yet in November 2026 the Centre doubled the OMSS (D) rice target to 50 LMT. It also made weekly stock disclosure mandatory, and States are imposing stock limits [1]. This shows that full godowns do not guarantee that grain reaches every market.

Supply-side tools: efficacy

• OMSS (D) e-auctions add open-market supply directly. 25 LMT was sold by 31.10.2026, against 11 LMT a year earlier [1].
• Bharat Rice, sold through NAFED, NCCF and Kendriya Bhandar, holds down retail prices. Extra quantities go to the rice-eating Southern States [1].
• Offloading also lowers FCI's carrying cost on surplus stock.

Supply-side tools: limits

• Uptake depends on price. Only 1.62 LMT of rice sold in 2023-24, against 71.01 LMT of wheat [3].
• Fiscal cost: FCI's economic cost of rice is about ₹39.8/kg [4], but the reserve price is ₹28/kg. The gap adds to the food subsidy bill.
• Leakage: Parliament was told of two cases where FCI rice meant for ethanol was diverted [6].

Regulatory tools: efficacy

• Weekly disclosure on the Food Stock Portal, across six rice categories, shows private stocks almost in real time [1].
• Sections 6 & 7 of the Essential Commodities Act, 1955 add penal deterrence. Time-bound limits, in force until 31.01.2027, curb speculative hoarding [1].

Regulatory tools: limits

• Disclosure has been mandatory since February 2024 [5], yet limits are back in 2026. Regulation alone did not stop the price pressure.
• Traders report their own stock, and checking it depends on State enforcement, which varies from State to State.
• Long-running limits can discourage private investment in storage and trade.

Assessment

• Supply tools treat the cause: not enough grain reaching the market. Regulatory tools treat a symptom: hoarding.
• Regulation works only as a short-term complement where supply does not reach markets fast enough.

Controlling cereal inflation therefore needs both tools, applied by rule rather than reaction. The Shanta Kumar Committee called for proactive sales whenever stocks exceed buffer norms [7]. To put this into practice, DFPD should:

• adopt an OMSS calendar linked to stock levels;
• publish State-wise data from the portal;
• meet food demand before allocating rice for ethanol.

This would advance SDG-2 (Zero Hunger) at a sustainable fiscal cost.