How Expensive is Food Security?

Sep 9th 2009, Jayati Ghosh
The poor monsoons and prevailing drought conditions in large parts of the country have once again turned the attention of policy makers to the problems of agriculture and food security. But they have also created tendencies to postpone some important decisions and commitments which are now more necessary than ever.

The UPA government promised us a new Food Security Bill, which was to be part of its 100 days agenda. The need for food security is obvious, even though it was underplayed in the last decade. As a nation, we have become uncomfortably aware of the difficulties of entering the global market to purchase food in periods of highly volatile prices, when even talk of imports by India can itself cause an immediate spike in price. This has created all sorts of anomalies: on more than one occasion the government has had to purchase imported food grain or sugar at prices higher than those at which they have procured from Indian farmers.

Meanwhile food security of households is in a parlous state. Inadequate and even worsening conditions of nutrition have been a concomitant feature of recent economic growth. India already had among the worst nutrition indicators in the world (with those in some states like Bihar and Madhya Pradesh well below even the average of Sub-Saharan Africa), even before the persistent increase in food prices reduced the ability of many more households to access sufficient food.

Yet the version of the proposed ''Right to Food'' bill that has been circulated by the central government to the states is a travesty of the original promise, and a negation of the spirit of ensuring genuine food security. While the Bill is still under discussion, the Note that has been sent to state governments makes several suggestions that are quite unacceptable, such as confining the provisions to the Below Poverty Line population (which itself is to be pruned according to central estimates rather than relying on states’ own estimates) and ensuring only 25 kg per month per household instead of the current 35 kg.

And now the Food and Agriculture Minister has declared that in view of the drought, even this pathetic attempt at legal intervention has to be postponed for a year. Yet it is precisely in drought conditions, when both production and livelihoods are affected, that it is most important to ensure that food consumption among the population is maintained through public intervention.

There are some important points that need to be noted in any discussion of food security. First, a targeted approach that seeks to restrict food security to some defined poor households is cumbersome, expensive and ineffective. There are the well known errors inherent in targeting, of unjustified exclusion of the genuinely poor and unwarranted inclusion of the non-poor. The proportion of the population that is nutritionally deprived is significantly larger than the ''poor'' population, and in many states they are not completely overlapping categories either. And in any case, households – and people within them – can fall in or out of poverty, however defined, because of changing material circumstances. Similarly they can also go from being food-secure to food-insecure in a short time. The reasons can vary: crop failures, sharp rises in the price of food, employment collapses, health issues that divert household spending, the accumulation of debt, and so on. Monitoring each and every household on a regular basis to check whether any of these or other features has caused it to become food-insecure is not just administratively difficult, it is actually impossible.

Second, the notion that a universal scheme that provides subsidised food to all households is too expensive is not tenable either. Consider the maximal possible estimate of such spending. If all households in the country are provided 35 kg of foodgrain per month, that would come to around 90 million tonnes. At current levels of subsidy this would cost around Rs 120,000 crore. This may seem like a lot, but the current food subsidy already amounts to around Rs 50,000 crore, so this is an additional Rs 70,000 crore – or around 1.5 per cent of GDP.

Surely this is not too much to allocate to ensure that no one goes hungry in what should be a civilised society? In any case, compare the amount of Rs 70,000 with the huge amounts (nearly Rs 300,000 crore) that have been given away as tax benefits and other concessions to corporate over the past year, and it becomes a trivial amount.

Third, any programme of national food security must be combined with a concentrated focus on improving food grain production in the country, so that we are not dependent upon imports in a volatile global market. This requires much more attention to the requirements of farmers, and speedy implementation of the many reforms that have already been suggested by the Farmers’ Commission to improve the productivity and financial viability of farming, particularly of food crops.

Fourth, to make this successful it is also necessary to avoid instability in domestic prices of food grain and curb speculative tendencies. This does not simply mean cracking down on hoarders, which is part of the official publicity around any period of price rise. It also requires preventing speculative activity in futures markets, which means that there must be a ban on futures markets in all essential commodities.

These are all necessary and also eminently doable measures – but only if the central government is actually serious about ensuring real food security on the country.
 

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