Exaggerated numbers are thrown across our food security debate
The time has come to supplement the employment guarantee scheme with a food security strategy. And if we dont do it now,we probably will not do so for a long time. As the economist Gunnar Myrdal argued,a lot of scientific economic and social reasoning is thinly disguised value prejudices and it is,in important matters,more honest and in fact necessary to explicate your values. Having said that,the debate on food security is taking strange turns,both from critics and proponents.
The critics build up cataclysmic scenarios. Seventy-five per cent of the rural population and 25 per cent of the urban population start getting 3 kg of foodgrains and possibly 7 kg as soon as the curtain rises. This gets into astronomical quantities of foodgrain and money. The really bizarre number is a mechanically calculated 100 million tonnes. More than 60 million tonnes is a figure normally thrown about. The thousands of crores the budget will get depend on which end of the quantity scale you are it is,of course,very high. The economy,already in deceleration,goes into a tailspin. Also,already benefiting from an employment guarantee,rural labour households stop working and agriculture gets a lethal blow. Very experienced economists and political leaders give the story great credibility. Unlike the discussion of reforms,where difficulties and roadblocks are underlined in implementing government policies,here there are no shades of grey.
Reality will unfold differently. The legislation will take time. States which entitle more in law,and parties which represent them,perhaps knowing that in fact benefits are less,will play-act at championing the underdog. Others will take the cue from reformers and ask for cash transfers. All this will take time. More importantly,the reality is that,even in states with universal coverage of PDS and subsidised grain which is all that the present food security bill is about the actual off-take is normally not more than 40 per cent,if deficit and surplus states are taken into account. In deficit states,this could be higher by half and in surplus states,similarly lower.
Our finance ministry is conservative and it is extremely unlikely that the expenditures will be approved with theoretical numbers. There is a more compelling fallacy in the big numbers. Per capita rations are multiplied by eligible families. But grain preferences are going down. Even poor households in India consume more non-grains as their income goes up. The income elasticities for grain are less than a fifth of 1 per cent and those for non-grains are between 1 and 2 per cent for poor families. If you take that into account,grain off-take will be much lower than talked about. I asked an economist friend who wrote a report on this and he said he used NSS estimates,but not behavioural trends. Not more than two-fifths of the eligible families with the kind of numbers talked about will actually go to the PDS.
In fact,this leads to a major hiccup. The special groups in the legislation,poor,lactating mothers,the poor girl child,households headed by women and so on,are left to the states. I know that economists who are critical want to federalise the legislation in the name of efficiency,but the states have not covered themselves in glory,particularly the fast-growing and high-income ones,on these counts. It is not for nothing that in most countries this kind of legislation has a strong federal or central government imprint. In our country,the most important priority is being undermined. This is leakage to plug. It wont cost much but is important.
The argument that labour for agriculture will be a stumbling block to growth is overdone. There is overwhelming historical evidence that rising agricultural wages lead to technological progress in agriculture,with much better use of land and other scarce resources. Agriculture Minister Sharad Pawar,very well informed on agriculture,was right in highlighting that a few months ago and pointing out that decentralised mechanisation,not just tractors and so on,was the answer. One is badly advised to raise the shortage issue now.
All in all,a better-fed labour force will be an asset and it is high time we made a beginning.
The writer,a former Union minister,is chairman,Institute of Rural Management,Anand
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