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Rising prices and issues of governance

The prices of essential articles and commodities have been rising over the last several months, and the life of the poor people, the common person and the middle classes has become miserable. The government has initiated certain steps to control prices, but their impact is insufficient to compensate for the suffering.

Price rise is now a global issue. But with efficient management it is possible to control considerably the price line, particularly of essential commodities and articles, in our country. Foodgrains, cereals, edible oils, pulses, milk, sugar, tea, coffee, clothes and raw materials such as steel and cement are essential requirements for the common person. For a massive country like India with a population of more than 112 crores, ensuring the supply of essential articles and commodities at reasonable prices is a Herculean task. However, with proper vision and an efficient management and distribution system, it is possible to make available such articles and commodities at reasonable prices to consumers. This requires a massive Public Distribution System (PDS).

Many people presume that the PDS relates only to the distribution system. Production, procurement, storage, processing and distribution are its important components. During 1973-74, the Planning Commission constituted a committee under the chairmanship of this writer to consider the issue of the PDS. Its report, known as the Dharia Committee Report, explains all aspects of the PDS.

The production of wheat, rice, jowar, pulses, edible oils and ‘janata’ cloth has to be done in a planned manner to meet the people’s requirements. Irrigated lands, degraded or wastelands, as well as rain-fed lands will have to be effectively used for the production of essential crops.

Through scientific micro-watershed management, rainwater conservation and prevention of soil erosion it is possible to produce more than 400 million tonnes of foodgrains in India. Since Independence, determined efforts have not been made by the government to make all land productive and to attain self-reliance in agriculture and agro-based products. The National Rural Employment Guarantee Scheme (NREGS) has been made applicable to the whole country from April 1, 2008, and it could be effectively used on a priority basis for this purpose.

The support prices provided by the government are inadequate to take care of all costs incurred by the producing farmers. If a substantial increase is effected in support prices, producers will willingly come forward to supply their produce. Of course, private traders must be eliminated and cooperatives or companies of producers should be encouraged to manage all procurement along with government agencies. No forward trading should be allowed at the cost of the producers or purchasers.

The government has not bothered to create storage facilities at the village or tehsil level systematically. For want of an effective storage system, 20 per cent of our foodgrains are lost, eaten by rats and moths. Nearly 30 per cent of the perishable goods, such as vegetables and fruits, are lost for want of cold storage systems and processing facilities. A well-organised programme to construct storage facilities in cooperation with producers should be undertaken. Suitable quality, colour and size standards and up-to-date packaging should be encouraged to aid exports.

The country should identify the production centres and create a network of roads. It is equally important to coordinate road, rail, shipping and aviation transport. The importance of highways and broadways is appreciated. Simultaneously, the government should consider the case of thousands of villages where there are no “accessible ways.”

The distribution system is the most crucial part of the PDS. It is necessary to identify the need and timing according to the requirement of the consumers. It is generally felt that during Deepavali, wheat, rice, pulses, edible oils and sugar are required in all parts of the country. However, Deepavali is celebrated mainly in Maharashtra and Gujarat, and in some cities. Having regard to the need of these areas, sufficient stocks of articles and commodities should be kept ready 10 to 15 days in advance.

Similarly, Dasara or Vijayadasami or Bahu is celebrated mainly in West Bengal, Assam, Gujarat, Maharashtra, Delhi and parts of Karnataka. Onam is celebrated in Kerala and Pongal in Tamil Nadu. During the marriage season, all these essential articles and commodities are required.

Arrangements are required to store according to local needs, having regard to the festival and marriage seasons. Imports of such commodities and articles should be managed on similar lines. Steamers bringing such goods should reach the proximate harbours. The government should prepare a calendar of demand and supply.

Not only sufficiency of stocks but effective management from the production stage to the distribution stage is necessary to maintain the price line. When this writer was the Union Minister of Commerce, Civil Supplies and Cooperation, this was successfully achieved. During the Janata Party government it was possible to maintain the price line, and no queues were seen during festivals or other occasions.

The PDS is today being undermined in the name of a free market economy. In a vast country like India, without the PDS being put into play from the production stage to the distribution stage it will not be possible to maintain the price line and provide relief to producers and purchasers.

Instead of the existing policy of appealing to steel or cement producers to bring down prices, the government should exercise its powers under the Essential Commodities Act and bring all such articles under the purview of that law. This writer did that successfully during Janata Party rule. Today it is not happening, as the government is under the influence of vested interests or big companies, forgetting to care for the poor. In fact, today it is a government without governance under the control of a privileged few.

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