Understanding National Food Security Act, 2013
- Part 2 -

Sandeep Thoudam *

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Since independence two major developments can be seen in the cultivable area which can pose a great threat to food security. Firstly, the cultivable area has not increased in respect to the increase in population and secondly the number of the large land holding has declined substantially and there is tremendous increase in small and marginal land holding. From the year 1952 to 2010, only 19.28 million hectares of land was added on area under food grain production.

In the year 1990-2000, the total increase in the area under cultivation for rice was only 0.7%, wheat by 1.7% and pulses recorded a negative growth of 0.6%. It was only because of green revolution and agro service that food production has increased tremendously from 59.3 million tonnes in 1952 to 218.20 million tonnes by 2010. As of today more than 80% of the farmers are small and marginal. The substantial increase in the number of marginal farmer can be seen during the period 1960-2003, the number of land holdings doubled from 51 million to 101 million resulting in the sharp decline in average size of holdings and growing marginalization.

On the other hand, budget allocation and actual expenditure for agricultural sector is continuously declining in successive five year plan from 15% of the total outlay in the first five year plan (1951-1956) to 3.7% in the eleventh five year plan (2007-2012). Allocation for agriculture in states budgets has been only 5.84% during 2008-2009, in spite of the fact that this sector is the backbone of the rural livelihood security system.

The production of food grain also paints a very grim picture. The production of rice has been stagnant for some years and many believe that it is beginning to reach its pinnacle. The production is almost dormant at 2000kg per hectare. The production of wheat is also not expected to increase as the area under wheat cultivation is not likely to increase nor any further increase in productivity is evident. In the last decade wheat production remains stagnant around 2740 kg per hectare. Production of minor or coarse cereals like sorghum and millets which have been termed as nutri-cereals also shows bleak depiction.

The output of coarse cereals in the kharif season fell from 32.5 million tons in 2011-012 to 28.5 million tonnes in 2012-1013. One of the main contributors in this context is the regional disparity in the availability of land and water resources. This two are unevenly distributed across states. In the western part of our country there is sufficient area of arable land but there is shortage of water and on the other hand, in the eastern side there is sufficient quantity of water but the size of operational holding is too small to introduce modern farm practices and therefore per hectare productivity is very low.

In addition to it, the chemicalization of agriculture has not only degraded precious land and water resources but also affected the land productivity and quality of agricultural product. There is also increasing tendency of abandoning agriculture by farmer as it is no longer considered to be profitable and respectable occupation. In the report published by the Institute of Applied Man Power Research (IAMR), a part of the Planning Commission, on December 2012 states that on an average 2035 famers are losing main cultivator status every single day.

Another critical issue in food security is the increasing use of land and water resources for non agricultural purposes. During the last two decade, area under non agricultural has increased from 21.087 million hectare in 1990 to 26.513 million hectare in 2011. Contrary to this, net cultivated area (NCA) has declined from 143.99 million hectare to 141.579 million hectare during the same period. The consumption of water in non agricultural sector has also increased from about 6% in 1983 to 9.6% in 2012.

The importance of water cannot be neglected as it forms a major constituent in the production of food grain. In 2011-2012, India achieved a target of 235.88 million tonnes of food grains production, registering an increase of 364%, mainly because of water. During the last ten years, there has been a decline in the canal water irrigation system and a tremendous increase in the usage of ground water.

As of now more than 60% of our irrigation is done through ground water. Currently India is the largest ground water user in the world. The over exploitation of ground water by constructing millions of tube wells, unplanned abstraction, pollution, soil salinity etc have started showing slow growth rate even in ground water irrigated areas. The average per capita availability of water is estimated at 1600 cubic meters per year and it's expected to fall around 1000 cubic metres by 2050 based on current population projection.

The growing snag in agricultural sector needs high priority as the act doesn't provide any agriculture and production related entitlement to the farmers. Until and unless the issues related to farmers and the complication that is showing in the production of food grain are addressed, the policy programmes such as "Bharat Nihrman" yojana, national agricultural insurance scheme etc (crop insurance covers only 4-6% of famers) will have less impact in securing food stability India.

Storage system and Public Distribution System (PDS) issue

The importance of storage system cannot be neglected for the successful implementation of NFSA. Even before reaching the ware house, 10-15% of the food grain and 30-35% of fruits and vegetables are lost due to poor post harvest management practices and inadequate logistic support. India produces over 162 million tonnes of fruits and vegetables and surprisingly the cold storage facilities exist only for 12% of the total produce. Above this, the wide disparity in the availability of cold storage in the states poses a great challenge.

Andhra Pradesh, Karnataka, Tamil Nadu produces 31.66% fruits, 14.26% vegetable and 71.58% flowers of the total production and has only 5.31% share of the total cold storage facility of India. Gujarat and Maharashtra produces 28.42% fruits and possess 7% of the cold storage capacity. Uttar Pradesh, West Bengal and Punjab produces 12.83% fruits, 36.06% vegetables and 7.56% flowers and they constitute 71% of the cold storage capacity of India.

In 2011, our country total food storage capacity can accommodate 78.47 million tonnes of food grain, in which 50% is with FCI (owned and hired) and the rest with state government and private agencies (under private entrepreneur guarantee scheme). The total expenditure by both the centre and the state government made under "Food Storage and Warehousing" was also erratic. During 2007, it was Rs 1004.13 crore. Out of which the union government provided Rs 47.89 crore and the remaining by the state. It was increase to Rs 6461.34 crore in 2009-2010 and then reduces drastically to Rs 243.93 crore in 2010-2011.

The states were spending huge amount towards creation of storage facilities, incurring a substantial amount in their respective budget. According to the NFSA, a onetime expenditure towards the creation of storage capacities for food grain under TPDS (Targeted public distribution system) and other welfare scheme would be required for the timely distribution of food grain. This may create some setback as the act does not clearly specify the sharing of the financial burden between the centre and the state and therefore while implementing the act the poorer states will be hit harder for the additional cost for constructing storage facilities.

The basic objective of the PDS in India is to provide the essential goods at cheap and subsidized price to the consumer so as to insulate them from the impact of the rising commodities and to maintain the minimum nutritional status of our population. PDS helps both the producer and consumer by linking procurement to the support price and ensuring their distribution at affordable prices throughout the country. It operates on the basis of extensive procurement of food grains by the FCI on minimum support price (MSP) terms determined by the Agricultural Price Commission. Rice, wheat, sugar and kerosene have accounted for 86% of PDS sales. Pulses which contribute an important source of protein for the poor have a share less than 2% in the total sales. It distributes commodities worth more than Rs 30000 crores annually to about 160 million families.

PDS is seriously condemned for the distribution of inferior food quality, bogus card, inaccessible of nutritious food and irregular distribution of food grain. In 1997, a dual pricing structure in the form of above poverty line (APL) and below poverty line (BPL) was introduced under the Targeted Public Distribution System (TPDS) and it resulted in the tremendous increase in the leakage of the food grain. In 2001, the PDS became a subject of national debate as people in many parts of India were dying of hunger and starvation, while approximately 50 million tonnes of food grain were rotting in the FCI warehouse.

The most important reason for its unpopularity is the inability to stop the leakage of the food grain. Leakage in the system is mainly due to the diversion of food grain to the open market. In 2004-2005 about 54% of the subsidized food grain was estimated to be lost in this manner and in 2009-2010, it was reduced to 40%. In the same year the income support provided to the poor through PDS was Rs 21 billion whereas the total subsidy expenditure was Rs 204 billion. Out of this total expenditure only 10% accrue to the poor, 19% to non poor, 28% in excess cost of operation and 43% lost due to illegal diversion. It is really depressing to know that almost half of the subsidized food grain meant for the poor is lost due to corrupt practices.

To minimise the bottleneck in the leakage of the food distribution system NFSA is planning to introduce technological and administrative intervention, such as, use of "AADHAR card" and setting up of new accountability. It is also suggested by the critics that leakage can be complemented by measures such as de-privatisation of fair price shops, decentralised procurement, use of available technology to track movement and social audit of PDS.

India has been able to eradicate famine and reduced the famine like situation through PDS by opening approximately five lakh fair price shop in different parts of the country. Analysis based on the NSSO consumption data also shows that PDS raised the calorie intake of the population as a whole by about 6% in 2010. However, studies shows that rural poor have not benefitted much from the PDS as their dependence at the open market has been much higher and it is also observed that PDS remained limited mostly to the urban areas for a considerable period of planning while the coverage of rural areas was very insignificant.

PDS has also large inclusion and exclusion errors, the deserving household are left out and the better off household are gaining access to it. According to Planning Commission, large scale of potentially BPL household are classified as APL households and it can be seen in daily wage earners, who are kept out of the target group because of their income level but could be potentially food insecure household. Overall, the national percentage of household accessing PDS only increase from 27% in 1993-1994 to 35% in 2011-2012. Another issue which needs to be examined is that the operation of PDS has in fact resulted in all round price increase. The act may engrave this situation by creating a mismatch between supply and demand since 1/4th of the total cereal will be sold through the TPDS at subsidized rate. The high procurement price and large government stock may displace private trade resulting in the decline of the net quantities of food grain available in the open market.

Even if the farmers are able to produce the required amount of food grain for the implementation of NFSA. It will be impossible to see a successful application of this act until and unless the storage capacity and the reform in PDS are carried out at the earliest possible way. If the major part of the food meant for the poor continue to leak out of the PDS then it make no sense to keep spending on production if things are handled indifferently as is being done today.

To be continued...