India Records Bumper Crop, Though Problems Remain

Wednesday, 22 February 2012

Background

India is expected to pull in a record crop this year, following favourable rains. Estimates suggest that foodgrain output could reach more than 250 million tonnes, with rice reaching 100 million tonnes for the first time. The wheat output will top the government forecast, with a record 88 million tonnes expected. Yet, food insecurity remains.

Comment

On the surface, India will be food secure until at least 2040, yet the strong performance by the farming sector this year does not indicate Indian food self-sufficiency or food security for its growing population. As C. Shivkumar noted in India’s Financial Chronicle this past week (‘Food Security Doesn’t Mean Only Security of Foodgrains’), consumption patterns in India have shifted.

The result? India is deficient in pulses, oilseeds, fruits, vegetables, dairy, meat and fish. In addition, a Food Security Snapshot on India, published on 14 February 2012, by the Food and Agriculture Organization’s Global Information and Early Warning System on Food and Agriculture, warns that food security concerns remain for the vulnerable groups. Food price inflation again appears to be one of the underlying problems.

The government says it will stockpile rice, and will only release rice for export once domestic food prices improve. Nevertheless, the country is still expected to export about five million tonnes of rice in 2012, substantially up from the 1.5 million tonnes in 2011.

Another government response has been the introduction of the National Food Security Act. As a result, the Indian Government will provide subsidised food to those below the poverty line. The problem is that this will rely on an effective distribution system. Yet, the inability to achieve efficient distribution of food, free from corruption, which has long been seen as one of the weaknesses in India, is unlikely to be addressed by the Act. How effective this governmental response will be remains to be seen, with some fearing it will lead to further pressure on food prices. 

Gary Kleyn

Manager         

FDI Global Food and Water Crises Research Programme

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