October 16th 2014 is the World Food Day which is observed every year in more than 150 countries. This year the theme for the day is “Sustainable Food Systems for Food Security and Nutrition” to highlight and create awareness of the problem of hunger worldwide, seek solutions to food security problem, call for changes to our agriculture and food supply systems and make the world free from hunger.
Food Security in India – World Food Day 2014
Farm output in India has increased from 208 million tons in 2005-06 to an estimated 263 million tons in 2013-14. Accounting for population growth during this period, experts say that the country would need probably around 225 to 230 million tons to feed its people if food wastages are significantly minimized. Thus, while focusing to increase food productivity and output Government must prioritize its policy and program to reduce drastically food wastage to minimize the incidence of hunger and malnourishment. Most striking ground reality is that a significant percentage of food produced never reaches the consumers for a plethora of reasons.
The former minister of agriculture, Sharad Pawar once said that India is wasting food products worth Rs.50,000 crore each year, accounting for nearly 40% of total production in terms of value. These figures of wastage, however, do not reflect the true picture since it is in terms of only economic costs. For example, meat accounting for about as low as 4% of food wastage accounts for 20% of the wastage costs as against fruit and vegetable losses accounting for as high as 70%, account for about 40% of economic costs.
India ranks number one in terms of food losses. High wastage rates are often responsible for doubling prices of fruits and vegetables and 50% increase in the cost of milk. Apart from the wastages of perishable food, Wheat and rice are also abundantly wasted. Annually around 21 million tons of wheat rots or is infested by insects and pests because of inadequate /inappropriate storage facilities accompanied by inefficient management practices of the Government-managed Food Corporation of India [FCI] with no accountability.
To ensure food security, while the Government’s priority to increase food productivity per unit area should be to optimally utilize available land, water and energy, the country cannot afford the luxury of the wastage of 33% to 50% of all food produced. Need of the hour is to have adequate concern, commitment and accountability to minimize significantly, if not eliminating totally, the current level of food wastages. The solution to the country’s future hunger problem lies in formulating a strategic action plan to minimize these losses by 90% by 2016-17.
Nutrition in India 2015
The high food prices/ food inflation in the country can partly be attributed to these high wastage rates. High food inflation impacts considerably the poor since food accounts for 31% of their average monthly household expenditure. Major factors responsible for wastage of perishable food include, inter alia, absence of modern supply chains that can efficiently link the food grown by farmers to consumers, lack of adequate financial investments in cold storages and refrigerated vans, erratic electric supply, poor road connectivity and lack of investment-friendly policies that discourage the private sector to invest in creating this infrastructure.
According to the Indian Institute of Management, Kolkata, country has estimated cold storage facilities for only about 10% perishable food products, whereas the pressing need is for another 370 million tons of cold storage facilities for perishable products.
Gross mismanagement of the FCI to store wheat and rice has rendered FCI itself a part of the problem rather than a solution. Even the former Food Minister K V Thomas had once described FCI as a “white elephant that needs to be revamped from top to bottom.” This transformation, however, never happened. Mr Thomas, also, led a delegation to China to study the China’s impressive system of food production, procurement, storage and handling food-grains which could have been or be evaluated, modified and emulated to suit our situation.
The Government spends nearly 1% of its GDP for its mismanaged public food distribution system. Past experiences reveal that cost of food production, procurement, transport, storage and distribution has significantly increased and inefficient food management system has resulted into huge wastage, pilferages and deterioration in food quality, not even acceptable as cattle-feed.
The Independent Evaluation Office reveals that Government spends Rs.3.65 to deliver food of Re 1 while 57% of subsidized food-grains do not reach the intended beneficiaries and close to 36% of food-grains are siphoned off in the supply chain.
According to one expert grains trade analyst, grains procured @ Rs13.50 /Kg would ultimately cost Rs.39.50/Kg since additional costs would be incurred towards
- Procurement incidentals, viz. local taxes, bagging, transport to local warehouse
- Storage costs viz. interest, warehousing and transport cost for distribution.
- Central Government or FCI paying mandi taxes or market charges to major States viz. Punjab, Haryana, Andhra Pradesh and Madhya Pradesh
- Significant costs during food distribution under the PDS [from warehousing to fair price shops to households].
- Establishment costs of FCI
- Each state having its own administrative infrastructure and fair price shops seeking additional commission as retailing expenses.
Thus, subsidy amount just doubles @ 192%
It is, therefore, necessary to develop effective food management system, methods and procedure through policy intervention and programs that can
[i] produce food grains as expected annually even under frequent unpredictable conditions of drought and floods in some parts of the country
[ii] formulate a strategic action plan to minimize food wastages/ losses by 90% by 2016-17
[iii] facilitate the estimated level of only need-based procurement preferably at major district places in each State with complete safe storage
[iv] create additional facilities for quick and cost-efficient transport, processing and storage and
[iv] redesign the public distribution system and transparent grievance redress mechanism.
In short, problem of persistent inadequate storage facilities including unsafe storage leading to huge wastage of precious food accompanied by the most mismanaged public distribution system leading to black-marketing and food inflation has to be seriously addressed by policy makers emphasizing policy-implementation with total commitment, good governance, accountability and grievance redress mechanism.