Comprehensive food security in India is a topic that has to fight for attention with a host of other matters in Indian public and political discourses. It is a sign of the elitist turn that Indian economic policy making has taken over the last twenty years or so, if not more. It should be a matter of grave concern that the recent Kelkar Committee report has stated that food subsidies and the requirements of the Food Security Bill will create burdens on the public debt that may necessitate passing some share of the burden to APL ( above poverty line ) consumers in the future. The problem with this is that India's poverty problem is way more serious and complex than what these simplistic approaches seem capable of tackling. For a while, there was no clear consensus on whether the poverty line should be defined as 26 rupees a day for rural areas and 32 rupees a day for urban areas. Even now, it is not clear if these definitions of rural and urban poverty lines will be accepted in the final versions of the bill. 32 rupees a day is less than a dollar a day, which is a common criterion for poverty used around the world. Even when a dollar a day is used as a criterion for deciding who is poor and who is not, it is usually understood that the people earning between, say, a dollar a day and two dollars a day also encounter significant economic difficulties in their daily lives. Suggesting that some of the burden of food subsidies in India can be passed to APL consumers in the future may be missing some significant human welfare implications for those whose earnings are just above the poverty line.
The fact that India finds itself in a situation where providing food security to its citizens creates severe strains on public finances is a sign that some crucial aspects of the welfare of Indian citizens have been neglected for far too long. Why did comprehensive food security start attracting attention in India only after the public debt problem and the public finance problem became so vulnerable ? What kind of prioritization was being followed by Indian policy makers ?
As for the future, should the exact Kelkar Committee recommendations about food subsidies be followed or is there need for serious debate about which items of public expenditure need to be modified by how much in the future and over what timeframe and where food subsidies figure in all this ? Mr. Chidambaram has stated that the government is committed to implementing the Kelkar Committee recommendations. Does Mr. Chidambaram think that the recommendations about food subsidies should be followed exactly as stated in the report or should there be additional debate about the prioritization of expenditure items ? What definition of poverty line should be followed if one tries to follow the Kelkar Committee suggestions about food subsidies and APL families ? Without a clear consensus on the definition of poverty line and without a clear understanding about the income distribution just above the poverty line and the number of Indian families who are marginally above the poverty line ( which usually turns out to be quite large by most of the commonly followed definitions ), how can the government do justice to the human welfare aspects when it comes to prioritizing subsidy expenditures ?
Clearly, human welfare in India cannot be left to the mercy merely of these higher level reports and recommendations. Clearly, there is a need for more detailed analysis and debate about the complexity surrounding the poverty problem and the income distribution issue in India while deciding food subsidy policies. While growth and tax revenue increases can potentially relieve some of the pressure on this front, the prognostications on this front are not all optimistic. GDP growth in India has encountered some serious problems and it has not proved easy to increase tax revenues as a percentage of GDP. Given its implications for human welfare, a well-financed food security system should be a priority till growth and income increases lead to lower food subsidy needs. However, till such GDP increases and such income increases materialize, all efforts should be made to make the food security framework secure. Let us put food security at the top or near the top of the priority list of government expenditures and let us not make the food security framework vulnerable to expenditure cuts while poverty remains such a big problem for the country's economy.
by C. Jayant Praharaj ( send comments to [email protected] )
The fact that India finds itself in a situation where providing food security to its citizens creates severe strains on public finances is a sign that some crucial aspects of the welfare of Indian citizens have been neglected for far too long. Why did comprehensive food security start attracting attention in India only after the public debt problem and the public finance problem became so vulnerable ? What kind of prioritization was being followed by Indian policy makers ?
As for the future, should the exact Kelkar Committee recommendations about food subsidies be followed or is there need for serious debate about which items of public expenditure need to be modified by how much in the future and over what timeframe and where food subsidies figure in all this ? Mr. Chidambaram has stated that the government is committed to implementing the Kelkar Committee recommendations. Does Mr. Chidambaram think that the recommendations about food subsidies should be followed exactly as stated in the report or should there be additional debate about the prioritization of expenditure items ? What definition of poverty line should be followed if one tries to follow the Kelkar Committee suggestions about food subsidies and APL families ? Without a clear consensus on the definition of poverty line and without a clear understanding about the income distribution just above the poverty line and the number of Indian families who are marginally above the poverty line ( which usually turns out to be quite large by most of the commonly followed definitions ), how can the government do justice to the human welfare aspects when it comes to prioritizing subsidy expenditures ?
Clearly, human welfare in India cannot be left to the mercy merely of these higher level reports and recommendations. Clearly, there is a need for more detailed analysis and debate about the complexity surrounding the poverty problem and the income distribution issue in India while deciding food subsidy policies. While growth and tax revenue increases can potentially relieve some of the pressure on this front, the prognostications on this front are not all optimistic. GDP growth in India has encountered some serious problems and it has not proved easy to increase tax revenues as a percentage of GDP. Given its implications for human welfare, a well-financed food security system should be a priority till growth and income increases lead to lower food subsidy needs. However, till such GDP increases and such income increases materialize, all efforts should be made to make the food security framework secure. Let us put food security at the top or near the top of the priority list of government expenditures and let us not make the food security framework vulnerable to expenditure cuts while poverty remains such a big problem for the country's economy.
by C. Jayant Praharaj ( send comments to [email protected] )