For some weeks now, I am observing a concerted effort (or should I say a campaign) being launched through the media by the Commission for Costs and Prices (CACP) about the need to increase agricultural exports so as to reduce the current accounts deficit, and also to limit distribution of grain through the public distribution system in order to bring down the fiscal deficit. Simply put, CACP has been advocating removing safety nets in agriculture production and marketing, and letting the markets rule the game.
CACP flawed view is increasingly being lapped up by the media. I find several English language newspapers parroting the viewpoint, and this is terribly dangerous to only the national sovereignty but also to the future of this country. The Hindustan Times echoed this argument in the form of a lead editorial, captioned: Think beyond self-sufficiency (HT Jan 7, 2013, http://bit.ly/TUNPBf). In the editorial, the newspaper argued for a change in the mindset, stating: "Food security today is not about self-sufficiency, it is about recognising that food is a global commodity and being a major force in that market." To build up the argument it suggests that production of pulses, for instance, can be left to the vast stretches of Canada and Australia.
I have never understood the economic logic of letting farmers in Canada or Australia or for that matter in Myanmar produce pulses that India should import. Why can't we provide an assured price along with an assured procurement for pulses within the country? Instead of wasting resources on another illogical suggestion that was backed by Budget provisions -- setting up pulse villages, the effort should have been to procure pulses on a regular basis, the way wheat and rice is procured. Such an initiative would have turned India self-sufficient in pulses thereby reducing imports and in the bargain reducing the current account deficit. More importantly, it would have brought down the domestic prices and also given more income into the hands of farmers who farm in harsh drylands.
As I said earlier, the editorial draws heavily from the articles of being circulated by CACP. It says that in a globalised world, even food prices are determined by global benchmarks. And, then it makes a ridiculous suggestion: When India exports rice or sugar, it helps depress the world price, which, in turn, keeps down domestic inflation. This is completely a flawed hypothesis. It has seemingly dangerous for the food security of any nation, including India. Let us not forget, India has the largest population of hungry in the world, and even the Prime Minister has gone on record saying that he is ashamed of the extent of child malnutrition that prevails. Several studies have pointed to 47 per cent of children below 5 yrs being acutely malnourished.
I wonder why does the United States and for that matter Europe doesn't free its agriculture the way India is being asked to? Why isn't it profitable for farmers in US/EU despite the presence of big retail and futures trading? If freeing farmers from government-controlled procurement prices is the way forward, why does OECD provide US$ 374 billion as farm subsidy, including direct income support, to farmers every year? Well, you guessed it right. The basic idea behind such hidden lobbying efforts is to destroy the fundamentals of food self-sufficiency that India built so assiduously over the decades. By doing so, we are actually removing all hurdles in the spread of corporate control of agriculture in India. What happens to country's food security in the process is not the concern of lobbyists. By the time India turns into a Haiti (or Ethiopia), these economists would have retired and probably been inducted into the board of an agribusiness company.
Read also: A hungry nation exports food. it can happen only in a democracy.