Managing the food economy

By Bhanu Pratap Singh

ENSURING ADEQUATE nutrition for all is as important as ensuring the country's defence. Even `Swaraj' loses its meaning for those who have to go to bed on an empty stomach. That is why it has been laid down in our Constitution, ``The State shall regard the raising of the level of nutrition, and the improvement of public health, as among its primary duties''. To what extent the state has failed in providing adequate nutrition to our people is evident from the fact that the percentage of underweight children below the age of five is the highest - 53 per cent - in India, except for Bangladesh, where it is 56 per cent. From this one can conclude that nearly half of our nation is underfed.

Food security depends mainly on domestic production of grain. While our policy-makers have been extolling the achievement of about six per cent annual growth in our GDP during the 1990s they have hardly taken note of the fact that during the same period there has been a sharp decline in growth rate of grain production. The growth rate in availability of grain per capita during the 1990s came down by 0.28 per cent per annum, as compared to a rise of 1.2 per cent per annum during the 1980s. The Ninth Five Year Plan has proved a flop as far as achieving its target of foodgrain production is concerned. The target set for the terminal year of the Ninth Plan, 2001-2002, was 234 million tonnes. But taking into account the dismal performance of the farm sector during the first four years of the Ninth Plan, the Union Government reduced the target to 212 million tonnes. Even if this new target is achieved, the average per capita availability of grain during the Ninth Plan will be significantly lower than what it was during the Eighth Plan. The failure to achieve the grain production target during the Ninth Plan cannot be attributed to any wrath of nature. During the last 12 years, monsoons have been satisfactory, ranging between 119 and 91 per cent of the normal.

It needs to be noted that though we have been claiming self- sufficiency in foodgrain, the reality is that during the last 30 years, after the advent of the Green Revolution, we have produced enough grain only in five years for adequate nutrition of our total population at the rate of 180 kg per capita per annum. We should also take note of the fact that our average annual per capita availability of cereals has been no more than two-thirds of the world average.

Compared to China, we have more area under cereals production, and also more irrigated land. Yet, our per capita availability of cereals is less than two-thirds of that in China, as well as in the world as a whole. The reason is our low per hectare productivity, which is only 75 per cent of the world average and less than half of that already achieved in the U.S. and China.

We do not lack natural resources. Our potential is at least twice as much as we are currently producing. What we lack is political will. None of our politicians has ever set the target of achieving the full potential of our agriculture. Their thinking is still feudal. Agriculture and agriculturists are not their main concern. They should ponder why farming and farmers are still receiving so much attention from the Governments in the U.S., the European Union and China, which are all self- sufficient in grain.

The indifference of our politicians towards agriculture is evident from the sharp decline in the Government's own contribution to capital formation in the sector. Expenditure on agriculture research in India is only 0.2 per cent of the GDP, whereas in the world as a whole this percentage is 0.8, and in countries such as the U.S. between two and three per cent. Our Government should realise that compared to information technology, biotechnology in no less important for a country like India, where two-thirds of the population is still dependent on agriculture for its livelihood.

Management of the food economy should have two objectives; first, to increase grain production; and, second, to ensure its proper distribution. We have seen how our system has failed - both in the long run and the short term - to achieve higher productivity and production of grain. Now let us take a quick look at the Public Distribution System, which was established mainly to ensure a fair distribution of grain. Some of its disturbing features are as follows:

Its sky-rocketing cost, reflected in the ever-increasing subsidy paid to Food Corporation of India (FCI). Though the amount of grain distributed by the FCI has not materially changed, the subsidy paid to it has gone up from Rs. 2,800 crores in 1992-1993 to Rs. 12,125 crores in 2000-2001.

Last year its cost of delivery from producers to consumers was 30 per cent in the case of wheat, and 43 per cent in the case of rice, averaging no less than 36.5 per cent of the price received by farmers. Any marketing system of which the margin between producers and consumers is more than 25 per cent cannot be considered efficient.

Nearly one-third of whatever is despatched from Government godowns to different parts of the country, is pilfered on the way.

Most State Governments being bankrupt, they are unable to take advantage of the Targeted Public Distribution System for poor families. Hence the mounting stocks in Government godowns.

Because of its high economic cost, and the Government decision not to sell its grain at less than the economic cost to families above the poverty level (APL), such families are buying their requirements from the open market where prices are lower. This is indeed surprising since the FCI was established to restrain private traders from excessive profiteering. The result is that most of our people, who are above the poverty level, do not derive any benefit from the PDS on which the Government is now spending fabulous amounts.

Yet another intriguing feature of our PDS is that it is willing to sell grain at half the economic cost for consumption by foreigners but not by our own people, unless they are below the poverty level.

To sum up, the management of our food economy is in a mess. It is likely to worsen after the removal of quantitative restrictions (QRs) on the import of farm products. To improve the situation, the Government should take prompt and radical reform measures. The first step towards such reforms would be to withdraw all restrictions on free trade of farm products within the country. In the words of the Planning Commission, ``Trade in agriculture is besieged with a plethora of restrictions that continue to hamper its health and competitive potential. These, in turn, adversely affect the efforts of raising production and productivity. Therefore, all restrictions on movement, stocking, trading, credit by financial institutions, monopoly buying, processing and exports have to be removed to enable the farmers to take advantage of free market.'' It is not only illogical, but also immoral on the part of the Government to plead, on the one hand, for globalisation of trade and, on the other, fail to create one unified national market for farm products within the country.

(The writer is a former Union Food Minister.)

Send this article to Friends by E-Mail

Section  : Opinion
Previous : Fact and fiction about AIDS
Next     : Doctors and reservations