Telangana Procurement Battle Deepens as CM Revanth Corners Centre Over MSP Support

Telangana Chief Minister Revanth Reddy has escalated the state’s confrontation with the Centre over paddy procurement, arguing that Telangana is being forced to carry an unsustainable financial and logistical burden despite the Union government controlling India’s Minimum Support Price (MSP) system and food grain distribution network.

Addressing separate meetings with leaders of the Communist Party of India (CPI) and Communist Party of India (Marxist) (CPM), the Chief Minister said Telangana would procure “ every grain ” produced by farmers even if it imposed massive expenditure on the state exchequer.

The dispute comes amid Telangana’s transformation into one of India’s biggest rice-producing states after rapid irrigation expansion under projects such as the Kaleshwaram Lift Irrigation Project. Over the last five years, the state’s procurement figures have surged dramatically, exposing deep structural pressure on procurement, storage and transportation systems.

Official figures show Telangana procured nearly 70.2 lakh metric tonnes (LMT) in 2020-21, which jumped to 110.35 LMT in 2021-22 and further rose to 131.86 LMT in 2022-23 — among the highest procurement levels in the country. Procurement stood at 95.32 LMT in 2023-24, while the ongoing 2025-26 season has already witnessed a record 70.82 LMT procurement during Kharif alone , surpassing previous state records.

According to state estimates, Telangana produced nearly 148.03 LMT of paddy during the kharif season and another 140.81 LMT during the ongoing rabi season. The Congress government is now targeting procurement of nearly 80 LMT this season.

For 2025-26, the Centre fixed MSP for common paddy at ₹2,369 per quintal and ₹2,389 per quintal for Grade-A paddy. Telangana additionally announced a ₹500 bonus per quintal for fine varieties. At current MSP rates, procurement of 80 LMT alone could cost nearly ₹19,000 crore , while the overall burden including bonuses, transport, milling, storage and handling charges could exceed ₹23,000 crore .

At the core of the confrontation is the functioning of India’s procurement mechanism itself. While the Centre announces MSP and procures rice through the Food Corporation of India (FCI) for the national Public Distribution System, states carry out the actual ground-level procurement operations through civil supplies agencies and cooperative networks.

After paddy is procured from farmers, it is milled into rice under the Custom Milled Rice (CMR) system before being supplied to FCI. Telangana, however, argues that FCI is not lifting rice stocks quickly enough, resulting in severe storage bottlenecks. Huge quantities of rice are currently being stored in government godowns, rice mills and private warehouses while fresh procurement continues simultaneously.

The state has sought enhancement of procurement limits from 54 LMT to 80 LMT , release of nearly ₹1,468 crore in pending subsidy dues, expansion of storage capacity by around 15 LMT , additional railway rakes for transportation and faster rice lifting by FCI.

Revanth Reddy also blamed labour shortages and severe heatwave conditions for delays at procurement centres. He said many hamalis working in Telangana had returned to West Bengal during recent elections there, disrupting procurement logistics.

The procurement issue has now snowballed into a major political flashpoint in Telangana. K. T. Rama Rao demanded a white paper on procurement figures, while Union Minister Bandi Sanjay Kumar accused the Congress government of failing to provide adequate facilities to farmers waiting at procurement centres.

Apart from procurement, Revanth Reddy also highlighted the proposed Musi River rejuvenation project , reforms through “ Telangana Public Schools ,” and revised minimum wages for workers recommended by a Cabinet sub-committee headed by Deputy Chief Minister Mallu Bhatti Vikramarka.