The Kerala government has decided to raise the pricing of 13 staple foods that are supplied through Supplyco stores after careful consideration. These products' low prices were maintained by up to 70% in subsidies. The state cabinet's most recent resolution, however, states that the maximum subsidy will be 35% of market rates.

Additionally, the government has chosen to adjust prices in response to market movements. This move is seen as a break from the previous Pinarayi Vijayan ministry's policy, which prohibited raising the cost of goods that were subsidized.

The Cabinet rejected the price increase recommendation from the Civil Supplies Department because of the impending parliamentary elections. The approval was granted, nevertheless, after it was noted that Supplyco's financial status would deteriorate if the goods were sold at the current rates since the government was unable to provide further funding for a subsidy in light of the state's financial crisis.

The price increase was approved during a Left Democratic Front (LDF) conference last year, and in December of the same year, a panel of experts constituted by the Food and Civil Supplies Department provided the required recommendations. The Food and Civil Supplies Department's request for a maximum subsidy of 35 percent was approved by the government, despite the fact that LDF had proposed a 25 percent cap on subsidies.

According to sources, Supplyco owes suppliers over Rs 1000 crore and spends Rs 350 crore annually on subsidies. Nearly 40 lakh ration card holders buy discounted goods from public distribution locations each month. Nonetheless, over the past six months, the majority of these ration shops have experienced supply shortages.