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Rao Imports Wheat to Feed Teeming Millions

by DK Joshi
AN air of foreboding han -gs about the unfolding food situation in India.
The monsoon had a delayed and erratic start. The Meteorological Department has predicted that it "will be on the lower side of normal".
This disquieting warning comes in the wake of perilously low food slocks, especially of wheat, in the government warehouses and the likely decline in food production in 1992-93.
Estimated food grain production in 1991-92 is only 170.5 million tons against the targeted 180 million tons. It is expected to be around 170 million tons In 1992-93, though the target fixed is 182 million tons.
The government of Prime Minister Naraslmha Rao recognises that what is at stake Is Its economic reform strategy. Discontent over food scarcity and high prices may shake popular confidence In its efficacy
In June, the stock of food grain In government warehouses was only 15.3 million tons, nearly four million tons
short of the actual requirement of about 19 million tons. Buffer stock of 10 million tons Is needed as reserve at any time to meet shortages.
Anticipating that the economic liberalisation policy may lead to a rise In prices of food grain, the government has taken upon Itself the responsibility to feed the vulnerable sections of society through a revamped public, distribution system.
New Delhi has already contracted to Import a million tons of wheat from Canada and 50.000 tons of rice from Vietnam. Fear of an Impending food crisis comes despite u good monsoon for four years in a row. Average food output was 170 million tons a year, a quantum jump from around 140 million tons In previous years
Until recently It was believed India had left behind the nightmarish period of food
scarcity and humiliating food Imports of the late-1960s and 1970s. In fact, the euphoria over food self-sufficiency was so great that New Delhi even planned to export grain. But a short monsoon in 1991 completely upset government calculations. Il brought In Its wake conditions of drought and food scarcity In different
parts of India. Reports of starvation deaths, migration of farmers and cattle and sale of children In tribal belts appeared In the national press.
The government Is worried farmers prefer to sell wheat to private traders at prices higher than its effective price of Rs 275-280 per quintal. Moreover, many farmers 1n wheat-growing areas have switched to cultivation of more remunerative cash crops such as cotton and oilseed.
Experts say that while the economic reform strategy aims at a virtual overhaul of the entire economy the structural problems In the agricultural sector have not received scrl ous consideration.
The growth of agricultural output in the 198Os has, no doubt, been good, but there is little in terms of sustained growth. For example, the output in 1991-92 (170 million tons) to less than in 1989-90 (171 million tons).
In addition, there is increasing regional concentration of growth in output and marketed surplus. The northern region has become more dominant over the years.
Moreover, growth in output has not come from any extension of cultivated areas but . from yield increases; agricultural investment has shown a
downward trend — down In real terms of 20 per cent since the peak in 1978.
Indian agriculture has become progressively more dependent on intensive use of fertilisers and pesticides, which increase the risk of soil degradation and affect productivity.
A 1991 World Bank report on Indian agriculture says that "even the moderate growth has come at a heavy cost both to the budget and the economy".
It adds : The future prospects of the agricultural sector arc anything but promising. As the limits to growth from Green Revolution tcchnolqgies are approached, there arc no new technologies on the horizon. The scope for relying on expansion of irrigation Is smaller than In the post."
The Bank believes that a decline In capital formation In the agriculture sector and growing expenditure on subsidies. whleh to "crowding our resources available for productive investment, are two main factors which have held up agricultural progress.
In 1989-90, subsidies for food and agricultural inputs were Rs 135 billion (3.1 per cent of the GDP) as against public Investment of only Rs 110 billton.
The Bank recommends extension of the economic liberalisation policy to agriculture. However, experts warn that relying solely on the output price Incentive may lead to a situation in which prices keep rising but growth impulses remain low. They consider land reforms a key to India's agricultural problem.
India is caught in the vicious circle of poverty, a high rate of population growth and the declining productivity of land. Out of a total potentially productive area of around 264 million hectares, nearly 175 million hectares are subject to degradation.' Already 90 million hectares have suffered such damage.
Although the annual population growth has slowed — now 1.7 per cent against 2.1 per cent in the 1960s — It is still high. The government has projected a demand of 235-240 billion tons by the turn of the century when India's population may reach one billion.
The Bank believes "Doubling food production in India by 2030 can be achieved by maintaining the past rate of crop yields but will require fourfold increase in fertiliser application" — a remedy unacceptable to many Indian scientists and environmentalists.
The government has to evolve both a short-term and a long-term strategy for the agricultural sector. In the short-term it will have to Import more food grain, although that puts great strain on India's meagre foreign exchange resources. Four million tons of wheat Imports would cost 8600 millton.
Moreover, such action Is politically explosive because the farm lobby would justifiably clamour for a higher procurement price of wheat. The imported wheat price of more than Ra 450 per quinta? to double the minimum procurement prices of Rs 225 a quintal.
In the long run. India will need a second Green Revolution if It to to susiiUn Its growing population
— Gemini News