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“In its zeal to make low-priced food available to as many as possible, the majority on the National Advisory Council may deal a mortal blow to farmers and output, warn farmer groups.
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The proposal to distribute low-priced foodgrain to 80 per cent of the rural population has nothing in it to incentivise cultivation. Vijay Jawandhia of the Shetkari Sangathana says the least the NAC could have done was to recommend that the MS Swaminathan committee recommendations be implemented. That would have meant the minimum support price included 50 per cent of the margin on profit unlike 15 per cent now. Swaminathan is himself an NAC member.
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| If you want to distribute food grains almost free to 80 per cent of rural people, they have even less incentive to grow any food, he says. He bases his premise on the experience of Vidarbha, where farmers grew jowar on 40 per cent of their crop land till the Public Distribution System (PDS) was introduced. They gew it despite the fact that they earned very little from it. The moment cheap rice and wheat became available, farmers promptly switched over to cotton and soyabean, he says. |
Unless you address the security of the food producer, there can be no food security, he says. When you are giving millets at Re 1 a kg, why not subsidise the millet grower, too, rather than expect him to subsidise the consumer, asked Jawandhia.
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Devinder Sharma, agricultural economist, says the least the NAC could have done was to spell out how the PDS should be reformed and how local procurement should be done.
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Rakesh Tikait, spokesperson of the Bharatiya Kisan Union, says the recommendations totally ignore the need to boost cultivation. What is in it to enthuse farmers to grow more, he asks. When you justify a three-fold increase in salaries of MPs citing cost rise, should that not also lead to increase in the earnings of the farmers? He said the food security bill was only an entitlement for black marketeers.” Sreelatha Menon / B S October 25, 2010
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| Populist Measures destroying traditional Indian work ethos |
| Offers of free lunches are good politics, and produced an abundant harvest of votes for the UPA in 2004 and again in 2009. Unfortunately, good politics can be bad economics. Free lunches, including ‘dig and fill' employment programmes, can be very inflationary. These programmes might have won over the aam aadmi, but they have destroyed the traditional Indian ethos of hard work and frugality. ‘Paying the price for populism’ Sharad Joshi, 137/BL 310710 |
NAC suggests food subsidy for 75% of households
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| NAC recommends that the new law should provide a legal entitlement to subsidised foodgrains for at least 75 per cent of the population, which translates into 90 per cent of the country's rural population and 50 per cent of the urban population. |
This 75 per cent of the population is, in turn, divided into “priority households” — who should have a monthly entitlement of 35 kg at a subsidised price of Re. 1 a kg for millets, Rs. 2 a kg for wheat and Rs. 3 a kg for rice — and “general households” who should have a monthly entitlement of 20 kg “at a price not exceeding 50 per cent of the current Minimum Support Price” for the three grains.
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The NAC proposes that 46 per cent of the rural population and 28 per cent of the urban population would be classified as priority households. And that 44 per cent of the rural and 22 per cent of the urban population would be classified as general households. The criteria for categorising households as ‘priority' or ‘general' should be specified by the government of India.
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What this means is that those entitled to 35 kg of grain in the price range of Rs 1-3 will form approximately 40 per cent of the total population, while those entitled to 20 kg will form approximately 35 per cent of the population. The NAC proposal also allows for the provision of subsidised foodgrains to be extended beyond the poorest 75 per cent of the population.
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620 lakh tonnes grains needed for food security –Annual off take will increase by 50%
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The Centre will require around 620 lakh tonnes (lt) of foodgrains annually to meet the National Advisory Council's (NAC) recommendations on the proposed Food Security Bill.
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| This is way above the peak official procurement of 590.67 lt achieved during 2008-09 and 539.75 lt in the recent marketing year. BL 271010 |
PDS Leakage 40% to 100%
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| The leakage of foodgrains under public distribution schemes and for development programmes, where a portion of wages is paid in food grains, ranges from 40 to 100 per cent across a cross-section of States, a Government sponsored research study has revealed. |
According to an evaluation undertaken in 11 States by the National Council for Applied Economic Research in 2008, diversion of wheat and rice takes place in cereals meant for all categories — Antodaya Anna Yojana (AAY), below poverty line (BPL) and above poverty line (APL).
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In the case of Assam, the diversion is total in the case of wheat for APL and 83 per cent in the case of rice. In Bihar, diversion of wheat meant for AAY and BPL is above 40 per cent, while in the case of Chhattisgarh 78 per cent of the wheat for APL is diverted. (See table)
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The evaluation is, more or less, in tune with the findings of ORG-Marg in 2005. The findings showed total diversion of wheat in Assam meant to be distributed through ration shops. It also showed high percentage of diversion in Arunachal Pradesh (64.1 per cent rice and 96.2 per cent wheat). In Chhattisgarh, too, the diversion of wheat is as high as 71 per cent but more surprising is the diversion of wheat in Haryana being 74.2 per cent.
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The leakage from the public distribution system is due to the inclusion of people who were not eligible for concessional price and exclusion of those deserving of issue of such food grains on concessional terms. In Kerala, for example, the inclusion error or enrolment of wrong people for the benefits is 80 per cent, while in the case of Delhi and Rajasthan it is 50 per cent.
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| A Project Evaluation Organisation study in 2005 showed that total food grains leakage from the public distribution system is 36.38 per cent with nearly 20 per cent of coming at the ration shops and the rest through bogus ration cards. BL 230910 |
| Krsr/and/149/011110 |
