[Reader-list] RTF (Right to Food) Articles - 8

[Rakesh Iyer]

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*Volume 23 - Issue 12 :: Jun. 17-30, 2006*
INDIA'S NATIONAL MAGAZINE
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*COVER STORY*

* Food at stake *

BRINDA KARAT

 * The new proposals of the Department of Food and Public Distribution
constitute an assault on the right to food. *

  V.V. KRISHNAN

* A TRIBAL COUPLE in Bolangir, an Orissa district with a high percentage of
people below the poverty line. *

 PEOPLE may find it strange that the Union Finance Minister could ask for
votes in his home State of Tamil Nadu on the promise of providing rice at
Rs.2 a kilo for the entire population, but should practise the opposite when
formulating policies in New Delhi. Increasing food subsidies, stepping up
allocations to the Public Distribution System (PDS), and raising the number
of beneficiaries under the Antyodaya scheme are just some of the measures
that should have been provided for in the Union Budget. But they were not.

Now the Department of Food and Public Distribution, under the leadership of
Sharad Pawar, has taken this line of thinking forward with a set of
atrocious proposals. These include reduction in wheat allocations to the
States; allocation of coarse grains instead of wheat; removal of foodgrains
from the Sampoorna Grameena Rozgar Yojna (SGRY) scheme as part of wage
payments; decrease in allocations for drought-hit areas; increase in the
prices of foodgrains for both Above Poverty Line (APL) and Below Poverty
Line (BPL) cardholders in the PDS; reduction in quotas for both APL and BPL
by 5 kg from the present 35 kg; and prevention of sale of wheat in the open
market by State agencies, which is usually done to control prices. Taken
together, these proposals constitute a frontal assault on the right to food.


  The denial of the right to food for a large section of the Indian
population reflected in increased malnourishment, stunted growth, ill-health
and loss of energy and therefore productivity is an issue that deserves more
national attention. If countries were to be graded in terms of provision of
food security to their citizens, India would rank along with Ethiopia at the
lower end. The United Nations Children's Fund (UNICEF) report that one out
of every two children in India is malnourished confirms the lopsided
priorities of successive governments at the Centre that seek to narrow
fiscal deficits by reducing food subsidies. The previous National Democratic
Alliance (NDA) regime was symbolised by six crore tonnes of foodgrains
rotting in Food Corporation of India (FCI) godowns while people went hungry.
The United Progressive Alliance (UPA) government's record over the last year
has been one of gross food mismanagement symbolised by plummeting wheat
stocks, spiralling prices and, finally, wheat imports. A slew of policies,
followed by first the NDA and now the UPA, have resulted in the present
state of food insecurity at a time of acute rural distress. These policies
include (1) the nature of public distribution; (2) the gradual decline in
the role of the government and state agencies with regard to procurement;
(3) the lack of commitment to food self-sufficiency expressed in policies
that encourage a switch-over to export-oriented cash crop production from
foodgrains; (4) encouragement to forward trading in foodgrains and
pro-trader changes in the Agricultural Produce Marketing Act.

 Targeted PDS

 Until 1996, India had a universal PDS. The United Front government
introduced the targeted system with the mistaken notion that the infirmities
of the PDS would be curbed and that it would enable subsidised grains to
reach those who actually needed it. Targeting entails an identification of
the poor. Where these numbers are small, targeting may be a simple task.
Where these numbers are large, and in countries such as India where the
majority of the people are in the unorganised sector with fluctuating
incomes, targeting could become an instrument to exclude sections of the
poor from the right to food. Targeting is also a method linked to neoliberal
policies that seek to limit if not eliminate the role of the government and
state from its welfare responsibilities, which include the provision of
accessible food to its people.

 ASHOKE CHAKRABARTY

* BPL CARDHOLDERS OUTSIDE a ration shop in western Orissa. A Planning
Commission evaluation of the Public Distribution System last year found that
57 per cent of the poor had been actually excluded from the BPL system. *

 India now has 10 years of experience of the targeted (into APL and BPL
households with access to foodgrains at different prices) and further
targeted (into BPL and Antyodaya households) system. Last year, the Planning
Commission did an evaluation of the PDS and found that 57 per cent of the
poor had been actually excluded from the BPL system. Earlier, the Abhijit
Sen Committee had also come up with similar findings, pointing to the utter
failure of the targeted system, and suggested a return to the universal PDS.


An associated problem with targeting is that of identification of the poor.
If only those who are officially identified as "poor" can have access to
food, then clearly the method has to be one that ensures accuracy. The
prevailing method of identification is entirely unsatisfactory. There are
two sets of estimates. The estimate that is linked to allocations of
foodgrains is made by the Planning Commission. According to a reply given in
Parliament, the present concept of poverty line is based on the per capita
consumption expenditure needed to attain a minimum amount of calorie intake
out of food consumption along with a minimum amount of non-food expenditure
in order to meet the requirements of clothing, shelter and transport, among
other things. This is based on the methodology suggested by the Lakdawala
Committee in 1993 and the population projections of the Registrar-General of
India as on March 1, 2000. Shockingly, according to the current assessments,
it works out to around Rs.11 an adult a day. Clearly, this is not poverty
line but destitution line. Earlier foodgrain allocations were not linked to
poverty line assessments but were open-ended depending on past utilisation
by the States. The linkages came along with the targeted system. This
creates another anomaly. The Rural Development Ministry has a set of
programmes for BPL families. The States have to conduct a BPL survey on the
basis of the criteria decided by this Ministry. These are different from
those of the Planning Commission. Thus the State BPL census on the basis of
one set of calculations may be entirely at variance with those of the
Planning Commission. The number of BPL cards issued by the States is
reportedly over and above the Planning Commission "quotas" by as much as two
crores. However, the food allocation is made not on the poverty estimates of
the States but by those arbitrarily decided by the Planning Commission.

 V.V. KRISHNAN

* IN DHAMTARI DISTRICT of Chhattisgarh, old stocks of paddy being repacked
for distribution under public distribution schemes. A file picture. *

 According to current estimates, six crore households in India come under
the BPL category. That such a large number of people are earning less than
Rs.330 a month is shocking enough. But what is cruel is that anyone earning
above this meagre monthly income is classified as APL and excluded from the
right to subsidised foodgrains. The very words "Above Poverty Line" is
misleading because they include a vast section of the poor who have been
denied their entitlements through statistical fraud and jugglery to serve a
neoliberal agenda.


  The need for subsidised foodgrains for a wider section of people is also
reflected in increased offtake. While the offtake in the Antyodaya system is
around 90 per cent showing the desperate need of people for cheap
foodgrains, the offtake for BPL has doubled in the past few years, from
73.67 lakh tonnes to 228.45 lakh tonnes in 2005-06 out of an allocation of
273. 20 lakh tonnes which constitutes 83 per cent of the allocation.

As far as APL is concerned, the offtake is much lower not because people do
not need the grain but because for several years there was not much
difference in the APL price and the market price. The central issue price
for wheat is Rs.7.50 a kg. For rice the price range is from Rs.10 in Gujarat
and Maharashtra for 1 kg to Rs.9 in Andhra Pradesh and West Bengal. As
current market prices of foodgrains have shot up, the demand for APL
foodgrains will definitely increase but the poor offtake of the grain in the
past few years is being cited by the government to cut allocations,
precisely when people require it more.

To illustrate, according to a memorandum by the Fair Price Dealers
Association in West Bengal, whereas in 2004-05 the wheat allotment for both
APL and BPL was 2.22 lakh tonnes it has been slashed to 1.51 lakh tonnes in
the current year. Godowns of the FCI in five major centres do not have wheat
stocks at all. In April 2006, whereas the dispatch instructions were for 59
rakes, only 15 rakes actually arrived. Similarly, in the SGRY the earlier
component of 5 kg of wheat as part payment of a daily wage has already been
cut to 3 kg. States have complained that wheat allotments have virtually
stopped for this programme.


  Since rice procurement is reportedly up by around 28 lakh tonnes, it is
possible for the Central government to replace wheat allocations with rice
at least for the time being in consultation with the States. Instead of
taking such a step, the Centre is proposing a cut in allocations.

 POVERTY ASSESSMENT

 The demand for revision of methodologies for poverty assessment has been
raised by several eminent economists and also in Parliament. This is an
issue that requires the most urgent attention. In any case, linking food
allocations with centrally pre-decided quotas regardless of the reality on
the ground is a method to reduce the share of the poor in national
resources. This should be stopped and States allowed to draw food
allocations according to their needs.


  Secondly, the neglect of foodgrain production consequent to the new
agricultural policy's emphasis on export-oriented cash crops is a major
reason for current shortfalls in wheat production. With stagnating wheat
production, the danger level in weakening food self-sufficiency has already
been crossed with the rate of growth of food production falling below the
rate of growth of population. Last year, the production of wheat reached a
low of around 68.5 million tonnes while this year it is estimated at around
71 mt. Soil exhaustion in India's wheat-producing States of Punjab, Haryana
and western Uttar Pradesh may require diversification but it will be
disastrous if the government continues to encourage diversification without
a policy of bringing alternative land under wheat production.

 Procurement Policy

 The third issue is that of procurement of wheat. Wheat deficits to the
extent of 20 lakh tonnes below the buffer stock norms leading to imports for
the first time in decades are a result of the deliberate policy of the
government to cut down procurement on the one hand and encouraging private
trade on the other. In 2001-02, with wheat production at 69.8 mt,
procurement by state agencies was 20.6 lakh tonnes. This year, with wheat
production estimated at 71.5 mt, procurement has plummeted to just 9.18 mt.
The Minister's explanation is that since farmers benefited from higher
prices this was not a matter for concern. In fact state agencies were
disabled by pro-trader changes made in the Agricultural Produce Act. They
could now go straight to the farmer in the remotest village, while the FCI
can only buy from registered markets; the private traders no longer need a
licence or a recognised agent to buy foodgrains, thus escaping from market
fees which the FCI has to pay adding to its costs; while private traders can
go into the market according to their own assessments, the FCI is hamstrung
by bureaucratic procedures. Thus big companies such as Cargill, Reliance,
ITC and even the Australian Wheat Board, which has turned out to be the
company supplying the imported wheat, went into villages in Punjab and
Haryana much before state agencies and offered small farmers a price
slightly higher then the official minimum support price (MSP) of Rs.650.
Only when a large part of the produce had been cornered by private trade
that the government offered a bonus of Rs.50.


  Big farmers who could hold on to their stocks would have benefited from
the higher prices offered later, but the bulk of the peasantry sold their
produce to traders at prices below the Rs.700 offered three weeks too late
by the government. If the FCI had been given the same leeway as private
trade, then the present dismal record of low procurement could have been
avoided. Shockingly, the government offered the Indian farmer almost Rs.100
less than what it paid foreign traders for wheat it has imported at
Rs.789.20 a quintal. The cornering of the stock by private trade has
permitted wheat hoarding, which has pushed market prices up by Rs.5-6 a kg.
Thus private trade made a killing both ways, by buying the bulk of wheat at
prices only slightly higher than the MSP and by manipulating market prices
to two-thirds more than what they spent on buying the grain from farmers.

A dangerous argument advanced by the Minister is that the import of wheat
directly to the southern ports actually saved the exchequer Rs.399 crores.
According to him, the cost of distribution of wheat procured in Punjab or
Haryana to the last centre in southern India works out to Rs.1,120 a quintal
compared to Rs.997 it costs for the transport of imported wheat. Decades of
building a food security system can be wiped out by such neoliberal
ideologies that undermine the principle of self-reliance. Besides, it
reflects a naive belief that international prices will remain static whereas
clearly international traders are waiting to maximise profits through wheat
imports at higher prices to India. Further, a dangerous concession in the
way of lowering of phytosanitary standards in the quality of wheat is also
being planned. This must be opposed strongly. India can spend thousands of
crores to protect itself through nuclear might but can render itself
completely vulnerable by losing its greatest achievement, the backbone of
sovereignty - food self-sufficiency.


  With this approach, the situation on the rice front could follow a similar
disastrous pattern in the future. It also raises the question of whether it
is appropriate to combine the Agriculture Ministry with the Food and Public
Distribution Ministry, which has been done for the first time in the UPA
Cabinet with Sharad Pawar holding both portfolios.

Fourthly, the FCI is being weakened systematically. Huge amounts, running to
thousands of crores of rupees, are owed to the FCI on account of foodgrains
supplied by it to different government programmes such as the SGRY and the
food-for-work programme. But these amounts do not appear either in the
Budget or in the accounts of the Rural Development Ministry.


  In answer to a pointed question in Parliament, the Finance Minister
replied that there was no need to show it in the Budget as "there is a
separate accounting system with the FCI". Precisely because the FCI's role
in procurement and distribution of foodgrains is being curbed, the ability
of the government to intervene in the market to control prices is also
reduced. In a country where there is an uneven pattern of foodgrain
production with a large number of States facing food deficit, weakening the
FCI means weakening food security.

 Other programmes

 The employment schemes of the government with part of the payment in
foodgrains have been an important part of the provision of food security,
though inadequate. The move to cut back on this component is also to cut
down on the real wages of the worker. With the current high prices of wheat
and other essential commodities, what the worker gains in cash is less than
what he/she has to pay for his/her foodgrain needs in the market.

Linked to the issue of weakened distribution and the cutting down of
allocations is the fate of the 4.83 lakh fair price shops. To use the
illustration made by Madhura Swaminathan, there is evidence from Kerala, the
State with the most effective system of rationing, of ration shops becoming
unviable. In the early 1990s, the average monthly sale of cereals was 7,500
kg of rice and 2,000 kg of wheat per ration shop. By 2001, these figures had
fallen to 1,400 kg of rice and 200 kg of wheat. Many fair price shops are
now estimated to be making losses. According to an official estimate by the
Government of Kerala, the gross earnings per fair price shop fell from
Rs.3,711 before March 2000 to Rs.1,493 in August 2001. The situation has
worsened since then.


  What needs to be done is to improve the systems - whether of the
procurement agencies, the fair price shops or the methods of distribution -
but not to destroy them. But that is what the Food and Public Distribution
Department seems to be proposing. People-centred reform requires a return to
the universal PDS. The Cabinet must reject the proposals of the Ministry led
by Sharad Pawar, that are contrary to the commitment of the Common Minimum
Programme.

*Brinda Karat is a Polit Bureau member of the CPI(M).*

    * *

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