The cabinet committee on prices (CCP), which reviewed the availability and prices of essential commodities on Tuesday, also reduced the price of palmolein oil sold in 15 kg tins from Rs 33,000 per tone to Rs 24,000 tonne with immediate effect.

The CCP has directed that more than four months old palmolein stocks be disposed off by open tender if such stocks remain unlifted in spite of reduction in issue prices.

Briefing newsmen about the CCP meeting, information and broadcasting minister Pramod Mahajan said that as on July 7, 1999 STC had a stock of 50,000 tonne of oil. The government has ordered import of 2.5 lakh tonne of palmolein in 1998 of which 70,000 tonne was yet to be procured.

Lifting of stocks has gone down from over 13,000 tonne in January 1999 to less than 500 tonne inJune. Mahajan added that as the stocks were likely to deteriorate, immediate disposal has become necessary either by reducing CIP or by selling through open tenders. The landed price of oil was approximately Rs 26,000 per tonne and for old stock it was Rs 36,000 per tonne. The subsidy requirement for implementing the decision would be about Rs 45 crore.

The prices of pulses have also gone up during the last three months (Rs 28 to 32 in Delhi and Rs 30 to 35 in Chennai). Mahajan pointed out that the government in June 1999 ordered an import of 1 lakh tonne of pulses of which 11,000 tonne were expected by the end of July. The rest, he said, would be imported on suitable intervals to keep the prices under check.

The prices and supply of other essential commodities like wheat, onions, sugar etc, he added, were within "very reasonable limits."

The CCP, Mahajan added, also approved the disposal of 7250 tonne of old stocks of rubber procured by STC on government account in the domestic market at the bestavailable price. The sales realisation in this exercise is expected to be in the range of Rs 20 per kg thereby rendering a total deficit of about Rs 13.70 crore on 7250 tonne of rubber.

He added that the old stock was likely to deteriorate if not disposed off urgently.

Meanwhile, the cabinet decided to increase the authorised share capital of the Cotton Corporation of India from Rs 25 crore to Rs 75 crore. This would help the corporation in raising extra funds for its price stabilisation operations and also improving its access to the international market.