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A Didar Singh
July 15, 2013
The National Food Security Bill passed in Parliament on July 3 through an ordinance is premature as the country is not adequately prepared to roll it out. True food security can come about only through higher agricultural productivity and production, a population with sufficient jobs and earnings to pay (whether directly or through government revenues) a fair remunerative price to the farmer, and an efficient storage and distribution mechanism that minimises losses. If these issues are not addressed, the food security Bill would amount to an unaffordable dole.

The Bill should aim to provide food security to people below the poverty line. As it has been conceived, it covers 75% of the rural population and 50% of the urban population. The contradiction in providing fresh subsidies at a time, when, as a well-articulated policy, subsidies are sought to be directed to the truly needy, is obvious. To compound the confusion, the government is anxious to simultaneously implement the food security Bill as well as direct cash transfers towards subsidies. Can the purpose of the Bill not be met by direct transfer of cash or food stamps to those below the poverty line?

The Planning Commission estimates that 27.5% of the population is below the poverty line. Even if the Tendulkar Committee estimates on poverty are considered, the population that benefits from the FSB should not exceed 37.2% (to be precise, 41.8% in rural areas and 25.7% in urban areas). The enormous savings in subsidies by restricting coverage to the BPL population should be directed to providing infrastructure and social benefits such as food warehouses, higher education and health benefits. The Bill also falls back on the inefficient Public Distribution System. Surveys suggest about 40% of the beneficiaries were denied ration cards and 99% of those who availed the benefits reported that they had not received supplies regularly.

Due to the huge population covered by the Bill, the free market for grains could disappear as the Government becomes the largest acquirer. The unintended victim could be the farmer who would either continue to suffer with unremunerative prices for food grains, or would shift to producing other items. Leakages from distribution channels will also create a grey market and end up recycled as freshly produced grains in the MSP purchase counters of FCI the next year. The nation would suffer. The basis of the coexistence of NREGA and FSB also needs to be critically evaluated as overlapping segments of the population could abuse benefits from the two programmes.

We have not touched upon the discriminatory and, consequently, legal, aspects of granting such fundamental rights; nor have we considered the implications of a natural event such as a weak monsoon or a global event that affects food production. In such a case, India would have the potential to distort the price balance of the entire global food supply chain. How could we fund such a level of imports? After all, the Bill will impose  an enforceable right on all successive governments.

Real food security can accrue only from a combination of improved food production and productivity, and the creation of a larger number of jobs. The political decision-making system must have a clear perspective before we create a solution that is a larger problem than the problem itself. A Didar Singh is secretary general of FICCI

The views expressed by the author are personal