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Ensuring food security

The sharp rise in the prices of wheat and other staple crops in the global markets over the past two years poses a grave threat to food security in India and other developing countries. In December last year, the Food and Agriculture Organisation, in a grim warning, pointed out that fewer people, especially in the developing world, will be able to get food. The FAO’s food price index rose by 40 per cent in 2007 on top of an already high 9 per cent jump during the previous year. The food bill of the neediest countries has been rising sharply; it touched $107 million in 2006. Between December 2005 and December 2007, wheat prices in the international markets climbed from $165 to $381 a tonne and the price of maize from $103 to $180. Rice prices have registered a 40 per cent increase during the same period. In fact, the prices of not only staples but of oil seeds, milk, and meat — practically every other agricultural produce — have gone up. Ominously for India and other developing countries, the present rise in food prices does not follow previous cyclical patterns and is likely to remain high over the medium term. Along with the price rise, there has been an equally worrisome depletion of food stocks.

An exporter of food grains till a few years ago, India is on the verge of becoming a net importer. Food grain production in recent years has not kept pace with demand. Realising the gravity of the situation, the Centre last year launched the National Food Security Mission to raise food grain production by 20 million tonnes — 10 mt of rice, 8 mt of wheat, and 2 mt of pulses — during the Eleventh Plan. However, even that modest target — an annual growth rate of 2 per cent over the base period — looks unattainable. For instance, despite a good monsoon, the winter wheat crop is not likely to yield much more than in 2007. India’s food policy is increasingly conditioned by the global environment. This was reflected in the record minimum support price for wheat at Rs.1,000 a quintal, announced before the sowing season for the winter crop. At harvest time, however it may prove inadequate. The real challenge before India and other developing countries is to get the U.S. and European governments to stop giving incentives for biofuel cultivation, a policy that leads to a significant shift in land use away from growing food crops. Unlike in the case of subsidies related to cross-border agricultural trade, which are governed by the WHO rules, the developed countries are free to offer such incentives.

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