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Resource centre on India's rural distress
 
 

A spoonful of policy

-The Business Standard

 

Remember the food riots of 2008? Is the world heading towards another food crisis? That, worryingly, seems to be the conclusion that a new publication on food prices and availability in the next decade (2011-20), issued jointly by the Organisation for Economic Cooperation and Development (OECD) and the United Nations Food and Agricultural Organisation (FAO), arrives at. The OECD-FAO report forecasts agricultural commodity prices, in real terms, remaining higher over the next 10 years than the price levels registered over the previous decade. This would put poor consumers at a higher risk of malnutrition. Cereal prices are forecast to swell, on an average, by 20 per cent and meat prices by 30 per cent. Worse, the world’s food production is foreseen to grow annually between 2011 and 2020 only by 1.7 per cent, compared with 2.6 per cent in the previous decade. The slowdown in crop productivity growth will, obviously, exert pressure on international prices.

Although, in the shorter run, farm commodity prices are expected to slide from the peaks touched around February this year, due to an increase in output in response to higher relative prices, this positive trend is not expected to last. Production shocks due to climate change, increasing pressure on land, and high output cost caused by rising energy prices will lend support to price spikes and volatility in the food market. A surge in demand for high-energy foods like legumes, fruit, vegetables and meats due to a rise in population and incomes, changing food habits and expanding urbanisation will also help sustain high prices.

However, this is not the first time that the world will have to deal with a high food prices-driven emergency. Similar, even if not the same, situations were witnessed in 2007-08 and in 1972-74. Though these difficult spells had caused a good deal of social unrest in resource-poor countries which were caught unguarded, India, China and some other food security-conscious countries came out almost unscathed. The mantra that worked in India was investment in crop productivity enhancement technologies (read green revolution technologies) in the early 1970s and the existence of domestic grain reserves, besides protectionist policies, in 2007-08. It is, of course, a different matter that India and other countries which cosseted their domestic grain reserves by banning food exports, received considerable flak globally for contributing to the supply crunch in the global food bazaar.

It may be recalled that India was the second largest rice exporter in 2007-08. However, past global crises did not persist because some residual factors that contributed to it, notably weather extremes like droughts and floods in several key grain exporting countries, did not linger for too long. But the situation today is different in some respects and this should concern India, which is sitting on a massive food mountain. There are several medium- to long-term factors driving food prices up — rising cost of energy, impact of climate change, shrinking arable land and water resources, and rapidly rising demand for food. What is needed, therefore, is a sustained inflow of investment in cost-effective technologies for enhancing crop and livestock productivity. Resource-poor countries can benefit from global support and international action that is not just aimed at managing food emergencies and offering food assistance, but can also sustain domestic food production programmes. The world has the capacity and the capability to produce enough food to feed one and all. What it needs is greater imagination and empathy in managing food emergencies.