Source: India Today


So the Food Security Bill is through.  More than two thirds of the country’s population has now been promised highly subsidized food. Congress and UPA will get a couple of extra percent points of votes, add another 2-3 percentage points because of the good monsoons and you get a good enough swing for it to come back next year.  The BJP was checkmated as it was impossible for it to play its usual flawless doublespeak.

I am asked what could be bad about ensuring elimination of hunger and malnutrition.  I would like to ask a counter question? What is good about theFood Security Bill?

It promises to finally eliminate hunger and malnutrition, they say.  How? Because now the poor can buy wheat, rice and coarse cereal at highly subsidized rates.  How will the poor be identified I ask; that will happen they say.  Where will the poor buy from I ask; the Public Distribution System (PDS)they say.  Where? I ask again. The PDS shop, they say.  And why will the PDS shop now suddenly start working when it has not for so many decades?  Because now it’s a right, and people can demand redressal from the courts, they say.  

So let’s grant this – the PDS will now start to function because the government will better use better technology.  They will use GIS, GPS, perhaps Aadhar card and biometrics, etc. and this will eliminate the problems that the PDS system has.  How will it work? The government will buy grains from production centres, store and transport them to consumption centres, and then sell them at subsidized rates through the public distribution system.  Each of these will cost.  Of course the PDS system itself will need to be strengthened almost everywhere.  This will also cost. The high-tech sounding technology is not costless; the Aadhar number needs biometric identification, etc. etc. All of this will cost a lot.  A paper coming from the government’s own Commission for Agri Cost and Prices (CACP) puts the total figure at about 682 thousand crores over a three year period.   It is highly unlikely that the government can spend this, and the system cannot work well unless it is implemented very well.  Chidambaram fighting his needless forex battles cannot loosen the purse strings.  And even if he did, no one in this government has the ability to implement it.  And without some serious money backed by serious project management skills the subsidized food will not reach where it is intended to.  There will therefore be leakages.  The estimated leakage itself is about 200 thousand crore by the CACP.  I think it will be more as leakage is not only amount getting diverted, but also the amount wasted.  When the numbers are so high it is obvious what kind of people will like to get into politics and into the government, and which ones would stay away.

But these are all nitty-gritties of implementation.  TheFood Security Bill is inherently flawed in many other ways.  

Who will have control over this whole process?  They have not incorporated the Panchayati Raj Institutions, because they are not good enough.  They have not involved the private sector as we cannot trust those guys.  The trader is of course responsible for everything that’s wrong with India, so we cannot use him either.   So the only people who have any control over its implementation are the bureaucrat, the babu, and the FCI and a politician like Manmohan Singh or SharadPawar will oversee them in turn.

Further, the data show that malnutrition is a problem in India.  But academic laziness is rampant, and the designers of the actmissed getting into the components of that malnutrition; it is essentially coming from poor access to proteins, iron, and other micronutrients.  Where do we get those from? Fruits, vegetables, pulses, beans, milk, meat, eggs, fish.  What does the food security bill not cover? Fruits, vegetables, pulses, beans, milk, meat, eggs, fish! 

The right to food bill will not cause an immediate disaster.  But like the roots of the pipal tree it will slowly eat into the foundations of the Indian society and economy.  Some of us will benefit greatly from it, enjoy its shade for many years to come; but the tree will extract its price.  It will worsen the malnutrition problem as now calories will be far cheaper compared with other nutrients.  It will worsen the inflation problem, as farmers will find it far more profitable to continue with producing wheat and rice when India is demanding other foods.  It will prove disastrous for private agri trade and its whole ecosystem as the government will crowd it out. 

All of this is very predictable, just as the current economic crisis was. Don’t take it lightly, it is not about 120,000 or 25,000 crores; this act will weaken India’s foundations.