Telangana Books 12 Rice Traders Over PDS Fine Rice Diversion and Price Hikes
Joint enforcement teams in Telangana have registered 12 cases against rice traders and seized substantial quantities of grain following widespread raids in wholesale trading hubs, including Begum Bazaar, Nampally, and Maharajgunj in Hyderabad. The crackdown was launched in response to illegal diversion of fine rice distributed through the Public Distribution System, unauthorized stockpiling, and soaring open-market prices that have reached up to Rs 95 per kg.
The enforcement drives were carried out jointly by officials from the Civil Supplies, Police, GST, and Legal Metrology departments. In addition to the wholesale centres in Hyderabad, extensive inspections covered Rangareddy and Medchal-Malkajgiri districts, along with seizures from mills and outlets in Karimnagar, Nalgonda, Miryalguda, and Devarakonda.
Investigators found that fortified rice supplied through the PDS was being purchased from ration beneficiaries at Rs 20 per kg. Millers and traders subsequently polished the grain, mixed it with other varieties, and packed it into branded sacks to sell at steep retail markups. Inquiries also revealed that consignments of this diverted grain were being smuggled out of Telangana to neighbouring states, including Maharashtra, Karnataka, and Chhattisgarh.
The Telangana government introduced the supply of fine rice through the PDS in March 2025, allocating nearly Rs 14,000 crore annually to the initiative. The state provides six kilograms of rice per beneficiary each month across 1.06 lakh ration holders and roughly 3.42 crore beneficiaries, distributing over 2.05 lakh metric tonnes monthly. The illicit trade has undercut the scheme while market rates for fine varieties jumped between Rs 80 and Rs 95 per kg, partly driven by traders anticipating reduced yields due to El Nino.
Civil Supplies Minister N. Uttam Kumar Reddy issued a stern warning to traders against black marketing, hoarding, and price gouging, stating that stringent legal action would follow any violations. Department officials confirmed that inspections across mills, wholesale shops, and retail outlets will continue, alongside meetings with trade representatives to rein in escalating consumer prices.
