The Kerala government is planning to formulate a scheme in association with Kerala Bank from the next procurement year for the prompt payment of procurement price to farmers as soon as paddy is collected.

This was decided at a meeting called by the Chief Minister, along with the Food, Agriculture, Power and Cooperation Ministers, here on September 16, Minister for Food and Civil Supplies G.R. Anil said in the Kerala Assembly on Monday (September 29, 2025).

Replying to a submission by C.C. Mukundan on the difficulties faced by paddy farmers because of the “inordinate delay” in the government’s payment of procurement price, Mr. Anil said the support price for paddy is fixed by the Centre and then disbursed to States, which often takes anywhere from eight months to a year. The government adds its share of incentive bonus for farmers to this amount, which is then disbursed to farmers as procurement price.

The Centre owes the State ₹1,206 cr, as its share of the support price from 2017-18 to 2024-25, which is to be distributed to farmers, he said.

He said there is a massive misinformation campaign that the Centre has not released this amount because of the State’s inability to furnish the audited accounts of the nodal agency for procurement, the Supplyco.

However, the audited statements of only about 2% of the total money owed by the Centre to the State is pending at present, and the State is in the process of expediting the audit submission.

In the 2024-25 procurement year, the State government procured 5.80 lakh metric tonnes of paddy from 2,07,143 farmers at ₹1,645 cr. Of this, ₹1,574.5 cr has already been paid to 1,96,913 farmers.

What is remaining is the payment of ₹70.5 crore to 10,230 farmers and the government has already initiated the process.

Mr. Anil said the government could disburse the procurement price only because of the allocation that the Finance Minister had made ahead towards incentive bonus for the year 2025-26 in the State Budget and that the Centre had not contributed even a rupee to this.