Friday, 23 March 2012

INDIAN AGRICULTURE AND FOOD SECURITY: IN THE ERA OF GLOBALIZATION

(This paper is published in the book "Sustainable Agriculture in 21st Century" by Regal publications New Delhi With ISBN 978-81-8484 in the year 2014)  

Sustainable agriculture in 21st century :  strategic approaches and practices /

DK Number:
DK-242786
Title:
Sustainable agriculture in 21st century : strategic approaches and practices
Author:
Editors Dr. Naheen Haider Zaidi and Mohammad Muqeet Khan.
Year:
[2015]
Price:
INR 1,180.00

S. VIJAY KUMAR

Ensuring food security ought to be an issue of great importance for a country like India where more than one-third of the population is estimated to be absolutely poor and one-half of all children malnourished in one way or another. There have been many emerging issues in the context of food security in India in the last two decades.

They are:
1) Economic liberalization in the 1990s and its impact on agriculture and food security;
2) Establishment of WTO: particularly the Agreement on Agriculture (AoA) under it;
3) Challenges of climate change; crisis of the three Fs, viz., food prices, fuel prices, and financial crisis;
4) The phenomenon of hunger amidst plenty, i.e., accumulation of stocks in the early years of this decade and in 2008-09 along with high levels of poverty;
5) Introduction of targeting in the Public Distribution System (PDS) for the first time in the 1990s;
6) ‘Right to Food’ campaign for improving food security in the country and the Supreme Court Orders on mid-day meal schemes;
7) Proposal for National Food Security Law (Right to Food); and
8) Monitorable targets under the Tenth and Eleventh Five Year Plans similar to the Millennium Development Goals (MDGs) on poverty, women and child nutrition.

India is considered as one of the fastest growing economies in the world. However, the problems of globalization have not been seriously addressed by the government policies and strategies, especially with regard to agriculture sector. One of the excluded sectors during reform period was agriculture which showed low growth and experienced more farmers’ suicides due to fake and terminal seeds, low prices and inadequate agricultural policies. The post- reform growth was led by services. Commodity sector growth (agriculture and industry) has not been higher in the post reform period as compared to that of 1980s. Particular worry is agriculture sector which showed lower than 2% per annum in the last decade.
There is disconnection between employment growth and GDP growth. In other words, employment is not generated in industry, services where growth is high. On the other hand, GDP growth is low in agriculture where majority are employed. Today, even after 64 years of independence agriculture sector bears 60% of population with low earnings, while industry and services together bears 40% with high incomes. Thus, there has been lopsided approach to development in India in the last two decades. Governments are more interested in pleasing the corporate sector (e.g., SEZ policy) rather than helping agriculture sector which bears 60% of the burden, while the European Union is considering the release of additional land for agriculture-set aside under 1992 regulation to control excess capacity. Globalization policies in the 1980s and particularly 1990s and beyond have created many challenges for agriculture in developing countries. Some of the consequences and impacts of globalization are: exposure of domestic agriculture to international competition, growth of non-agricultural sector and its impact on demand for agricultural products, urban middle class life style changes including diets, rising food imports in developing countries, competitiveness of diversification of domestic production systems, vertical integration of the food supply chain. Because of demographic pressure, there has been significant increase in small and marginal farm holdings. These farmers have to face the challenges of globalization. Risk and uncertainty has also spread to marginal lands. The diversification of agriculture also raised concerns on food security. It may be noted that the slowdown in agriculture growth could be attributed to structural factors on the supply side, such as public investment, credit, technology, land and water management, etc., rather than globalization and trade reforms per se. There are six deficits in Indian agriculture. These are:

1) Investment, credit, and infrastructure deficit;
2) Land and water management deficit;
3) Research and extension (technology) deficit;
4) Market deficit;
5) Diversification deficit; and
6) Institutions deficit.
Reforms are needed to reduce these deficits in order to achieve the following goals of agriculture:
1) 4 per cent growth in agriculture;
2) Equity in terms of higher growth in lagging regions, Small and marginal farmers, and women;
3) Sustainability.

According to Food and Agriculture Organization (FAO), food security exists when all people, at all times, have physical and economic access to sufficient, safe, and nutritious food to meet their dietary needs and food preferences for an active and healthy life. Food security has three components, viz., availability, access, and absorption (nutrition). The three are interconnected. Many studies have shown that improvement in nutrition is important, even for increase in productivity of workers. Thus, food security has intrinsic (for its own sake) as well as instrumental (for increasing productivity) value.

OVERVIEW OF FOOD SECURITY
The Green Revolution, launched in the late 1960s, had overwhelmingly impacted the various dimensions of food security. It helped India triple its food grain production between 1968 and 2000 and consequently in halving the percentages of food insecurity and poverty (even though the population had almost doubled during the same period), thus rendering India a food self-sufficient nation (at macro level)—indeed a laudable achievement. Per caput dietary energy supply (DES) increased from 2370 kcal/day in 1990-92 to 2440 kcal/ day in 2001-03, and prevalence of under-nourishment in total population decreased correspondingly from 25 to 20 per cent. Between 1993/94 and 1999/2000, 58 million individuals came out of the poverty trap, the number of poor dropping from 317 million to 259 million. Other livelihood indicators such as literacy rate and longevity also increased significantly. Life expectancy at birth in 2011 is 65.77 years and 67.95 years respectively for males and females against 58 and 59 years in 1986-91 (Agricultural Statistics at a Glance, 2007).

After remaining a food deficit country for about two decades after independence, India became largely self-sufficient in food grain production at the macro level. There have hardly been any food grain imports after the mid-1970s. Food grain production in the country increased from about 50 million tonnes in 1950-51 to around 233.9 million tonnes in 2008-09. The growth rate of food grains has been around 2.5 per cent per annum between 1951 and 2006-07. The production of oilseeds, cotton, sugarcane, fruits, vegetables, and milk has also increased appreciably.

The experience of the last two decades shows that growth rates of production and yield have declined for crop groups/crops during the period 1996-2008 as compared to the period 1986-97. The growth rate of food grain production declined from 2.93 per cent to 0.93 per cent during the same period. The growth rate of production was much lower than that of population in the latter period. Similarly, growth rate of yields of food grains declined from 3.21 per cent 3 to 1.04 per cent. There was also a decline in growth rates of production and yields for cereals, pulses, oilseeds, rice, and wheat. Under liberalization domestic production and consumption of food were declining. Removal of food subsidies had led to decrease in the amount of food purchase from the public distribution system. The off take of rice had declined from 10.1 metric tonnes in 1991-92 to 6.9 metric tonnes in 1995-96. The off take for wheat has gone down from 8.8 metric tonnes to 3.8 metric tonnes. While agricultural exports as a percentage of total exports had gone down, cereals in exports had gone up from 1.4% to 3.4%, indicating that exports were increasingly based on the creation of domestic food insecurity. India at present finds itself in the midst of a paradoxical situation: endemic mass-hunger coexisting with the mounting food grain stocks. The food grain stocks available with the Food Corporation of India (FCI) stand at an all time high of 62 million tons against an annual requirement of around 20 million tons for ensuring food security. Still, an estimated 200 million people are underfed and 50 million on the brink of starvation, resulting in starvation deaths. The paradox lies in the inherent flaws in the existing policy and implementation bottlenecks. 

REASONS FOR DECLINE IN FOOD PRODUCTION
The performance of the overall agriculture sector and the factors responsible for the slowdown provide an explanation for the decline in the growth of food production. It may be noted that food grains, pulses, oilseeds, sugar, fruits and vegetables, poultry, dairy, meat, fish, etc. constitute the bulk of the output in the agriculture sector.

SHORT RUN AND LONG RUN PROBLEMS IN AGRICULTURE
There are both short run and long run problems in Agriculture. Farmers’ suicides continue unabated, even increasing in some states, as growth rate in yield is on the decline. Farming is fast becoming a nonviable activity. Further scope for increase in net sown area is limited. Land degradation in the form of depletion of soil fertility, erosion, and water logging has increased. There has been decline in the surface irrigation expansion rate and a fall in the level of the ground water table. Exposure of domestic agriculture to international competition has resulted in a high order of volatility in prices. Disparities in productivity across regions and crops, and between rain fed and irrigated areas has increased. Long term factors like steeper decline in per capita land availability and shrinking of farm size are also responsible for the agrarian crisis. Land issues such as SEZs, land going to non-agriculture, alienation of tribal land etc. are becoming important. There is every reason to think that India is falling into the same primary export trap as the sub-Saharan African countries and the Latin American countries have already done. The trap consists in exporting more and more physical volumes of products at falling unit dollar price so that the country has to run harder and harder to stay in the same place with regard to export earnings. Thus during the period from 1985 to 1993 the developing countries export volumes grew at 9% annually but their share in world export earnings fell and the purchasing power of exports growth almost halved. At the same time in order to export more, scarce land is diverted from food crops cash crops.

As cash crops claim more area at the expense food grains, yield has not risen enough to compensate for area decline and the compound growth rate of food grains output has dropped to 1.7% below the population growth rate, during the period 1990-91 to 1995-96 for the first time in three decades. High economic growth rates have failed to improve food security in India leaving the country facing a crisis in its rural economy, warns the latest report released by the World Food Programme and the M S Swaminathan Research Foundation (MSSRF). The report says that the number of undernourished people is rising, reversing gains made in the 1990s. Slowing growth in food production, rising unemployment and declining purchasing power of the poor in India are combining to weaken the rural economy.

At the global level, the South Asian region is home to more chronically food insecure people than any other region in the world and India ranked at 67 below our neighboring countries—China and Pakistan by 2010 Global Hunger Index, released by the International Food Policy Research Institute in the Global Hunger Index of 84 countries. While famines and starvation deaths remain the popular representation of the contemporary problem of hunger, one of the most significant yet understated and perhaps less visible area of concern today is that of chronic or persistent food and nutrition insecurity. This is a situation where people regularly subsist on a very minimal diet that has poor nutrient and calorific content as compared to medically prescribed norms.

On the composite index of food insecurity of rural India, states like Jharkhand and Chhattisgarh are found in the ‘very high’ level of food insecurity, followed by Madhya Pradesh, Bihar and Gujarat. The better performers include Himachal Pradesh, Kerala, Punjab and Jammu and Kashmir. Andhra Pradesh, Madhya Pradesh, Bihar, Gujarat, Karnataka, Orissa and Maharashtra perform poorly. Even economically developed states like Gujarat, Maharashtra, Andhra Pradesh and Karnataka find themselves in the category of high food insecurity—a reflection perhaps of the manifestation of the agrarian crisis in the states and its consequent negative impact on the health and well-being of the rural population. “Nutrition security involving physical, economic and social access to balanced diet, clean drinking water, sanitation and primary health care for every child, woman and man is fundamental to giving all our citizens an opportunity for a healthy and productive life,” said Professor MS Swaminathan, Chairman, MSSRF. Unless this aspect of food security is attended to with the involvement of local bodies, the food security
situation in India will not show the desired improvement.
  
SUGGESTIONS

(1) Revival of Agriculture:
(a) To achieve 4% growth and equity in agriculture, the supply and demand side constraints have to be removed. The support systems have to be tuned to improve productivity and incomes of farmers with emphasis on small and marginal farmers and dry land areas.
(b) Agriculture policies have to keep in mind increasing risk and uncertainty due to liberalization, gender sensitive as the share of women is increasing and on cost of production.
(c) Infrastructure including irrigation, natural resource management, research and extension, inputs including credit, diversification by maintaining food security, marketing, regional planning have to be
focused for higher agriculture growth.

(2) Subsidies: India should stress on the implementation of Uruguay round agreements to reduce subsidies and other distortions caused by policies pursued by developed counties.

(3) Demand Side Issues:
(a) adequate insurance is needed for those carrying out diversification with in agriculture or from agriculture to non-agriculture.
(b) Social security should be provided for the unorganized workers also.

(4) Rural Non-Farm Sector: The ultimate solution for reduction of pressure on land is to improve rural non-farm sector and planned urbanization, so that it will result in increase in yield/hectare and decrease in disguised unemployment. Chinese experience shows that Globalization with better initial conditions has increased employment and incomes for workers which in turn were due to rural diversification.

(5) Structural Change: Structural change in economy should follow agriculture-industry sequence. But, in GDP shares India leap-frogged from agriculture to services without concentrating on manufacturing. This happened in many other South East Asian countries. But, their share of employment in manufacturing sector is more when compared to India. For e.g. the share of employment in manufacturing in Malaysia is 50%, in Korea 62%, in China 31%, in India it is only 11%. There, is need to develop industry in order to improve employment. Jumping to services is not the solution.

(6) Special Economic Zones (SEZs): The Government of India is allotting agricultural lands as SEZs to industrialists, which in turn reduces the cultivable food crops and endanger food security in the country. The examples of Nandigram in West Bengal and Rajasthan (“Arre arre chor aaya re…SEZ layare!” So goes rallying cry) may be cited, where farmers resisted against governments. This should not happen in future. The government may allot uncultivable lands (Barren lands) as SEZs to industrialists.

(7) Political Economy of Agriculture: There is a feeling that government (Central and State) promise a lot for agriculture without much allocations and implementation. Hence, the governments should come up to the expectations of farmers.

(8) NGO’s Role: NGO’s have a moral obligation to call upon our political leaders, businessmen, labour leaders to make economic decisions, so that first priority is given to the basic needs of the vast majority of the people for food, employment, housing, education and health care. Through organization, collecting the small farmers, conducting formal and non formal education for the adults to create analytical mind to be aware of the existing economic system, how it affects their life directly or indirectly must be explained. NGO’s should come forward to organize a net work system - at District, State, Regional and National level. They respond at a macro level.

(9) National and Millennium Developments: Priority areas of action should be to achieve the national and Millennium Development Goals of reducing hunger and malnutrition.”

(10) Food-based Interventions: Some of the important foodbased interventions like the Public Distribution System (PDS), the Integrated Child Development Services (ICDS), and the Mid Day Meal Scheme (MDMS) are measures recommended for improved performance. There is a need to create a universal PDS with uniform prices affordable to the poor and the allocation should be based on the number of consumption units in the household.

(11) Achieving Nutrition Security: A serious handicap in achieving nutrition security also arises from poor sanitation and environmental hygiene and lack of clean drinking water; hence they should be taken care of.

(12) Reorienting India’s Economic Policies: Reorienting India’s economic policies to provide adequate support for agriculture and its vast rural population is the need of hour.

(13) Horticulture: As noted Prof. Swaminathan said “We must explore a horticulture remedy to tide over the nutritional malady.”

(14) Conservation of Common Property and Biodiversity: Appropriate attention should be paid to conservation of common property and biodiversity resources and rehabilitation of wastelands“.

(15) Futures Market can be encouraged: To avoid wide fluctuations in prices and prevent distress selling by small farmers, futures market can be encouraged. (An auction market in which participants buy and sell commodity/future contracts for delivery on a specified future date. Trading is carried on through open yelling and hand signals in a trading pit).

(16) Crop Insurance Schemes: Crop insurance schemes can be promoted with government meeting a major part of the insurance premium to protect the farmers against natural calamities.

(17) Restrictions on Food grains: All restrictions on food grains regarding inter-State movement, stocking, exports and institutional credit and trade financing should be renounced. Free trade will help make-up the difference between production and consumption needs, reduce supply variability, increase efficiency in resource-use and permit production in regions more suited to it.

(18) Food Security can be Productively linked: Food security can be productively linked to increased enrollment in schools to achieve cent per cent literacy.

(19) Rationalization of Input Subsidies and MSP: With rationalisation of input subsidies and MSP, the Central Government will be left with sufficient funds, which may be given as grants to each State depending on the number of poor. The State government will in turn distribute the grants to the village bodies, which can decide on the list of essential infrastructure, work the village needs and allow every needy villager to contribute through his labour and get paid in food coupons and cash.

(20) Creation of Food grain Banks: The FCI can be gradually dismantled and procurement decentralized through the creation of food grain banks in each block/ Mandal/village of the district, from which people may get subsidized food grains against food coupons. The food coupons can be numbered serially to avoid frauds.

(21) Enhancing Agriculture Productivity: The government, through investments in vital agriculture infrastructure, credit linkages and encouraging the use of latest techniques, motivate each district/ block/Mandal to achieve local selfsufficiency in food grain production. However, instead of concentrating only on rice or wheat, the food crop with a potential in the area must be encouraged. Creation of necessary infrastructure like irrigation facilities will also simulate private investments in agriculture.

(22) Focus on Accelerated Food grains Production: The focus on accelerated food grains production on a sustainable basis and free trade in grains would help create massive employment and reduce the incidence of poverty in rural areas. This will lead to faster economic growth and give purchasing power to the people.

(23) Help to Small Farmers: Poverty and food insecurity is greater in rain fed and dry land areas. Small farmers can be helped in increasing productivity by having access to extension services and better water management. Sustainable agriculture should be the focus of interventions.

(24) Organic Farming: Organic farming can also be encouraged to protect the environment and generate higher incomes for small farmers.

(25) Urban Agriculture: Urban agriculture can improve food security in urban areas. Homegrown food (For example, Vegetables, Mushrooms) can also be encouraged as it would contribute to food security and nutrition as well as freeing incomes for non-food expenses such as health and education.

(26) New and Innovative Solutions: New and innovative solutions for water management and improving soil fertility should be developed. Focus on tribal areas for sustainable agriculture. Focus on areas likely to be affected by climate change.

(27) Group Approach to Realize Economies of Scale: Group approach to realize economies of scale in buying inputs and marketing outputs. One important problem in India is marketing of agricultural production. For example, tomatoes may be sold by farmers at Re.1 per kilogram but consumers buy them at Rs.20 per kilogram. A group approach can help farmers in getting the right price.

(28) Using Information Technology: Using information technology for agricultural production and marketing. For example, providing mobile phones to the poor and marginal farmers can help in marketing.

(29) Purchasing locally grown Food: Purchasing locally grown food from low income and small holder farmers to benefit their families and communities.

(30) Problem of Malnutrition: The problem of malnutrition is much broader than that of access to food. This needs a  multi-disciplinary approach covering diet diversification including micronutrients, women’s empowerment, education, health, safe drinking water, sanitation, and hygiene. India has government programmes such as TPDS (Targeted Public Distribution System) including AAY (Antyodaya Anna Yojana), nutrition programmes like midday meals, ICDS, etc. helps to improve food and nutrition security. NREGS and self-employment programmes can also increase access to food and nutrition. The problem of malnutrition is the highest in rain fed and high land areas. Higher agricultural productivity and diversification of agriculture can help in raising incomes.

(31) Improving Delivery Systems: In order to improve delivery systems in food based programmes there is a need to strengthen programmes like Integrated Child Development Services (ICDS) with the convergence of several departments. International agencies can help in this convergence as a pilot project to improve the delivery systems.

(32) Micro Nutrient Programme: Micro nutrient programme is another area of intervention. For example, Vitamin A tablets alone have prevented many deaths. Vitamin A and food fortification like salt iodization are an integral part of food security programmes.

CONCLUSION
India is more or less self sufficient in cereals but deficit in pulses and oil seeds. Due to changes in consumption patterns, demand for fruits, vegetables, dairy, meat, poultry, and fishery products has been increasing. There is a need to increase crop diversification and improve allied activities. Social protection programmes in India have helped in improving incomes as well as providing protection to the population, especially to the poor, from shocks in the economy. However, there are lots of gaps and inefficiencies in the social protection programmes. Under National Food Security Act, the government wants to provide 25 kilograms of rice and wheat at Rs. 3/kg to BPL families. This would be an important step in the direction of ensuring food and nutritional security of the country. However, food insecurity and malnutrition continue to be high. The problem is with both design and implementation of the programmes. The focus of reforms can now be shifted to more efficient delivery systems of public services. It has been recognized that better governance is very important for effective functioning of food-based programmes.

Social mobilization, community participation and decentralized approach are necessary in this context. It may, however, to be noted that governance has to be contextualized in relation to the socioeconomic environment. Appropriate institutions are needed for better implementation of policies and programmes. For example, rural institutions in areas like land, water, marketing of agricultural and non-agricultural products, credit, technology, and infrastructure are needed for better governance. Similarly, people-centric programmes and institutions are needed for better implementation of social protection schemes. A self-help group approach for livelihoods is relatively successful. For example, small and marginal farmers can get better services if they are organized through collectives like self-help groups or cooperatives. Finally, the ‘rights approach’ plays an important role in improving implementation of development programmes, which in turn solves food security problem in India.

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