The traditional mandis will soon be busy, as farmers bring in their winter crop. These summer months will likely see important challenges to the food economy --- thanks to a bumper crop, lack of storage capacity and a growing food subsidy bill, even as law makers will later this year begin work on a new law to guarantee food to Indians.
There should be no legal objections to this change, since the law governing the jobs scheme specifically allows the government to pay up to three-fourths of the payments in kind. The bigger problem seems to be policy incoherence. This move comes from a government that is very keen on moving to a system of conditional cash transfers modeled on the very successful policies in countries such as Brazil and Mexico. So India seems to be moving at the same time towards a greater role for cash transfers in its social security system as well as a reduced role for cash in one of its flagship social schemes. It’s confusing.
The more immediate problem is this. Indian farmers are expected to have a record harvest this year. The latest estimates from the agriculture ministry put the total food grain output during 2011-12 at 250 million tonnes, or almost 19 million tonnes more than the average harvest over the previous three years. The government will have to buy more food at a time when the granaries are already bursting at their seams.
The latest data available on the website of the Food Corporation of India website shows that the warehousing company holds 61 million tonnes of rice and wheat, far in excess of the buffer stock of 27 million tonnes and the strategic reserve of 5 million tonnes that it needs to maintain in its silos. The buffer stock norms are based on calculations about how much grain is needed to meet three goals: supply grain to ration shops under the public distribution scheme, have enough food in stock when farm production is below demand in bad agricultural years, and for use in open market sales to stabilize prices during episodes of high food inflation. Besides this, FCI has been asked since 2008 to hold a strategic reserve of 2 million tonnes of rice and 3 million tonnes of wheat.
The recent agreement between the food ministry and the rural development ministry to pay wages under the jobs scheme is most likely an attempt to reduce the food mountain so that there is capacity for fresh procurement and storage. Another short-term measure would be to increase storage capacity. FCI has this week signed agreements to build ten new warehouses that are expected to create capacity for another two million tonnes.
But there are also some fundamental challenges. The traditional thinking on national food security was shaped by humbling experiences of the 1960s, when India lived a ship-to-mouth existence, as vessels carrying American grain would land at Indian ports. The grain was then quickly moved to those parts of the country that were staring at famine. Such an arrangement was not only fragile but also led to pressure on India to compromise on foreign policy issues such as the Vietnam War. The Green Revolution – with its winning combination of new technology and price incentives – helped bolster food security.
The old framework should be considered a success, despite its growing flaws. The global thinking on food security is now changing. The focus has moved from nations to individuals. Our own experience of hunger amid massive food stocks shows that success at the level of the country may not necessarily ensure food security for all citizens, a fact that people across the ideological spectrum recognize. The Right to Food legislation --- that proposes to provide heavily subsidized food to three out of every four Indians --- that is due later this year is based on such thinking as well.
What the food minister and the rural development minister are now trying to do could be seen as an attempt to marry the goals of the rural jobs scheme and the food security scheme, even though the immediate problem is reducing the food mountain that is growing faster than the FCI can handle. But the idea that workers on public programmes should be paid in kind is an old one, going back to the pioneering food for work programme launched by Maharashtra after the 1973 drought. Neither does the new proposal tackle a pressing issue. What if the poor sell the food they get? Will their food security then be compromised?
None of these questions have easy answers, a fact that is rarely revealed in the heated debates on food security for the poor.
Niranjan Rajadhyaksha is Executive Editor of Mint
