It is reported that the rice in the stock was not ordinary but was fortified rice, which is enriched with essential vitamins and minerals and is meant for children, pregnant women and adolescent girls to prevent anaemia and malnutrition. Ethanol plant operators, rice millers and government officials are suspected of being involved in the scam. Four people have been arrested in connection with the scam so far.
The scam came to light after three truckloads of government rice dispatched from the Nawegaon warehouse in Balaghat to the AVJ Ethanol Plant in Borgaon, Chhindwara, on 2nd June failed to reach their intended destination. Official records showed the consignment was meant to be used for ethanol production. A day later, one of the trucks was traced to Sancheti Rice Mill in Balaghat instead of the ethanol plant. But the remaining two trucks also never reached the facility in Chhindwara.
The police formed a Special Investigation Team (SIT) to probe the matter. Over 40 people, including rice millers, ethanol plant operators, and transporters, have been questioned by the SIT. The investigation covered several ethanol plants and rice mills in the state, including Chhindwara, Balaghat and Seoni. 12 trucks have been seized so far.
The investigators discovered that ethanol plant operators obtain fortified rice from the government at a subsidised rate of ₹2,320 per quintal. In the open market, ‘broken rice’ for ethanol production is available at around ₹2,100 per quintal. Therefore, it is alleged that instead of producing ethanol from fortified rice, it is sold to rice millers at around ₹2,800 per quintal.
The investigation revealed that rice millers buy this rice from ethanol plants and pack it in new gunny bags. It is then deposited in government warehouses as custom-milled rice. This is done to save the cost of processing paddy into rice. It was also found that they also receive milling charges from the government and earn extra profit by selling the paddy allocated for milling in the open market.
The rules reportedly require the old rice already available in warehouses (FIFO) to be allocated for ethanol production. However, the rules were not followed by some officers, and they allocated new fortified rice. According to investigators, confidential information about rice allocation was passed on to concerned parties in advance through brokers. The investigators also found a dysfunctional monitoring system. Regular checks were not conducted on paddy given for milling, electricity bills of mills, and labour records. As a result, the irregularities could not be detected in time.
