8 Apr 2023

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Food Security in India: Myths and Realities

PRESENTED BY : GOURAV KUMAR VANI

MAJOR ADVISOR: SHRI P. S. SRIKANTHA MURTHY, ASSISTANT PROFESOR

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CONTENT Introduction to Food Security Physical Availability of Food Absolute break-up of MPCEMMRP by item groups Trends in % Composition of Consumer Expenditure (Rural

and Urban) Engle’s law - trends in consumption expenditure Per Capita Consumption of Cereals and Pulses Inequality in Consumption Elasticities of Food Expenditure by commodity Stark Realities Performance on Global Hunger Index

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CONTENT Demand & Supply projections for Foodgrains Govt. Measures for Food Security National Food Security Act 2013 Conclusion Policy Implication

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INTRODUCTION

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Food Security - MeaningFood Security exists, when all people, at all times, have physical and economic access to sufficient, safe and nutritious food to meet their dietary needs and food preference for an active and healthy life. (World Food Summit, Rome, 1996)

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Four dimensions of Food Security

FoodSecurity

Physical Availability of FoodThe supply side, determined by the level

of food production, stock level & net trade.Economic & Physical access to

FoodAdequate supply of food does not guarantee household level food security. Food access depends on incomes,

expenditure, markets & prices in achieving food security objectives

Food UtilizationThe way the body makes the most of various nutrients in

the food. Involves care & feeding practices, food preparation, diversity of diet & intra-household distribution

of food.

Stability of the other 3 dimensions over time

Access on a periodic basis. Weather, political conditions or economic factors have an impact on food security status.

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Physical Availability of Food

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Crop 2011-12 2012-13Rice 105.31 104.22

Wheat 94.88 93.62

Coarse cereals 42.04 39.52

Total cereals 242.23 237.3618

Pulses 17.09 18.00Total food grains 259.32 255.36

Oilseeds 29.79 30.72Sugar 24.60 26.00Vegetables 156.325 156.445

Fruits 76.42 79.40

Milk 127.9 133.7

Source:-RBI Hand Book on India Economy 2011-12

Table No. 2 (million tonnes)

Physical Availability of Food

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Year Cereal Pulses1950-51 44.3 8.0

1960-61 64.6 11.1

1970-71 84.0 10.3

1980-81 104.8 9.4

1990-91 145.7 12.9

2000-01 145.6 11.32005-06 157.4 12.7

2006-07 168.8 13.32007-08 168.9 14.7

2008-09 165.9 17.62009-10 173.7 15.8

2010-11 176.5 13.7

Source: Indian Economy,Gaurav Datt and Ashwani Mahajan,2013

Table No. 3 (in million tonnes)

Net Availability of Cereals and Pulses

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Commodity Per capita availability Minimum per capita requirement

Total cereals 528.70 400

Pulses 46.78 80

Total food grains 568.79 480

Oil 39.73 30

Sugar 54.79 20

Vegetables 348.47 300

Fruits 176.86 150

Milk 297.81 300

Source:-National Institute of Nutrition, Hyderabad

Table No. 4 (in gram per day)

Per capita availability, 2012-13

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Year Cereal Pulses Total 1950-51 334.2 60.7 394.91960-61 399.7 69.0 468.71970-71 417.6 51.2 468.8

1980-81 417.3 37.5 454.8

1990-91 468.5 41.6 510.12000-01 366.2 30.0 416.2

2005-06 390.9 31.5 422.4

2006-07 412.1 32.5 444.5

2007-08 407.4 32.5 442.8

2008-09 374.6 41.8 436.0

2009-10 407.0 37.0 444.0

2010-11 407.0 31.6 438.6

Source: Indian Economy,Gaurav Datt and Ashwani Mahajan,2013

Table No.5 (in gram)

Per capita Net Availability Per Day

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Table No.6

Source:-Key Indicators of Household Consumer Expenditure in India, NSSO report for 68th round survey.

Absolute break-up of MPCE MMRP by item group, All-India,2011-2012

Item group Amount (Rs.) Rural Urban

Cereal and cereal substitutes 154 175

Pulse and their products 42 54

Milk and milk products 115 184

Edible oil 53 70

Egg, fish, meat 68 96

Vegetables 95 122

Fruits 41 90

Food total 756 1121

Non food total 673 1509

Total 1430 2630

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Table No.7

Source:-Key Indicators of Household Consumer Expenditure in India, NSSO report for 68th round survey.

Trends in Percentage Composition of Consumer Expenditure Since 1993-94 for Rural India

Item group 1993-94 1999-2000 20004-05 2009-10 2011-12Cereal 24.2 22.2 18.0 15.6 12.0

Pulse and their products

3.8 3.8 3.1 3.7 3.1

Milk and milk products

9.5 8.8 8.5 8.6 9.1

Edible oil 4.4 3.7 4.6 3.7 3.8

Egg, fish, meat 3.3 3.3 3.3 3.5 3.6

Vegetables 6.0 6.2 6.1 6.2 4.8

Fruits and nuts 1.7 1.7 1.9 1.6 1.9

Food total 63.2 59.4 55.0 53.6 48.6

Non food total 36.8 40.6 45.0 46.4 51.4

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Trends in Percentage Composition of Consumer Expenditure Since 1993-94 for Urban India

Table No.8 Item group 1993-94 1999-2000 20004-05 2009-10 2011-12Cereal 14.0 12.4 10.1 9.1 7.3

Pulse and their products

3.0 2.8 2.1 2.7 2.1

Milk and milk products

9.8 8.7 7.9 7.8 7.8

Edible oil 4.4 3.1 3.5 2.6 2.7

Egg, fish, meat 3.4 3.1 2.7 2.7 2.8

Vegetables 5.5 5.1 4.5 4.3 3.4

Fruits and nuts 2.7 2.4 2.2 2.1 2.3

Food total 54.7 48.1 42.5 40.7 38.5

Non food total 45.3 51.9 57.5 59.3 61.5

Source:-Key Indicators of Household Consumer Expenditure in India, NSSO report for 68th round survey.

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There is decreasing trend in % expenditure on many of the commodities. Is this because of Engle’s Law of Consumption Expenditure ?

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16Source: Policy Brief on demand for foodgrains during 2020,Ramesh Chand, NCAP, New Delhi

Recent and Projected Growth Rate in IncomeTable No.9

Growth rate of

1993-94 to 2004-05 2004-05 to 2011-12 2011-12 to 2020-21 (estimated)

NNPFC 6.85 9.00 9.00

Rural 2.27 3.46 3.58

Urban 7.75 11.81 12.19

Total 4.97 7.57 7.81

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Category CPI WPI

Agricultural labourers

Rural labourers

General 10.53 10.44 7.06

Food items 10.54 10.51 11.84

Table No.10

Growth rate in Inflation Growth rate in Inflation (2005-06 to 2011-12(2005-06 to 2011-12))

Note: calculated by presenter based on the data available from ”Statistical Year Book,2013”.

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Consumption of Cereals and

Pulses

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Table No.11

Quantity (kg) of consumption of cereals and pulses per person for a period of 30 days for each decile class of MPCEURP All India, Rural, 2009-10.

SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Decile classes Total cereals Total pulses 1 10.2 0.41

2 10.6 0.49

3 11.1 0.53

4 11.1 0.54

5 11.5 0.54

6 11.4 0.61

7 11.7 0.62

8 11.8 0.72

9 12.1 0.77

10 12.1 0.91

All Classes 11.4 0.62

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Table No.12

Quantity (kg) of consumption of cereals and pulses per person for a period of 30 days for each decile class of MPCEURP All India, Urban, 2009-10.

SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Decile classes Total cereals Total pulses 1 9.43 0.469

2 9.54 0.559

3 9.47 0.590

4 9.61 0.665

5 9.69 0.724

6 9.52 0.783

7 9.45 0.850

8 9.35 0.895

9 9.23 0.934

10 8.57 1.038

All Classes 9.39 0.751

8 Apr 2023 21SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Table No.13

Quantity of cereal consumed per person per month and % share of rice and wheat in cereal consumption in 2009-10, major states

8 Apr 2023 22SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Table No. 14

Changes in Per Capita Cereal Consumption in Quantity terms in Rural areas in different MPCE fractile classes: All-India

8 Apr 2023 23SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Table No.15

Changes in Per Capita Cereal Consumption in Quantity terms in Urban areas in different MPCE fractile classes: All-India

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Inequality in Consumption across States of India

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Rank Rural areas Lorenz ratio

Urban areas Lorenz ratio

1 Uttarakhand 0.421 Kerala 0.388

2 Kerala 0.318 Maharashtra 0.378

3 Arunachal Pradesh 0.313 Uttar Pradesh 0.377

4 Punjab 0.284 West Bengal 0.376

5 Madhya Pradesh 0.277 Himachal Pradesh 0.373

23 Tripura 0.206 Jammu &Kashmir 0.284

24 Mizoram 0.198 Nagaland 0.244

25 Meghalaya 0.178 Meghalaya 0.239

26 Nagaland 0.172 Mizoram 0.232

27 Manipur 0.158 Manipur 0.206

Table No. 16

Inequality in Consumption across States of India

SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

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SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Table No.17

Lorenz ratios for Rural and Urban Sector of India

Sector URP MRP MMRP

Rural 0.291 0.276 0.270

Urban 0.381 0.371 0.362

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SOURCE:-NSSO REPORT NO. 538: LEVEL AND PATTERN OF CONSUMPTION EXPENDITURE

Lorenz curve for Rural and Urban India Figure 1

8 Apr 2023 28Source:-Demand and Supply of Cereals in India 2010-2025, IFPRI, Washington

Table No. 18

Estimated Elasticities of Food Expenditure by Commodity

Commodity Expenditure Elasticity Rice -0.21

Wheat -0.13

Pulse -0.24

Edible Oil 0.90

Milk 0.55

Vegetables 0.64

Sugar 0.83

Eggs 1.31

Fish, Chicken and Meat 1.17

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Stark Realties

• India ranked 10th largest Economy of world on nominal GDP basis and 3rd largest on economy on PPP basis

But India has…………..• 29% of the 872.9 million undernourished people (FAO)

• 49% of the world’s underweight children (WHO)

• 34% of the world’s stunted children (WHO)

• Over 46% undernourished children (WHO)• India is ranked 67 way below neighboring countries

like China, Nepal & Pakistan in 2011 Global Hunger Index by the IFPRI.

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• According to the latest data on child under nutrition from 2005–10, India ranked second to last on child underweight out of 129 countries— below Ethiopia, Niger, Nepal, and Bangladesh. Only Timor-Leste had a higher rate of underweight children.

• 21% of India’s population undernourished,• nearly 44% of below the age of 5 children are

underweight and

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7% of them dying before they reach fifth birthday

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Year Rank in Hunger index

Out of total no. of countries

Score Status

1990 31.73 Alarming

2007 94 118 25.03. Alarming

2008 66 88 23.70 Alarming

2009 65 88 23.90 Alarming

2010 67 84 24.10 Alarming

2011 67 81 24.2 Alarming

2012 65 79 22.9 Alarming

Table No.19

Source:-Global Hunger Report, IFPRI

Performance on Global Hunger Index

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Demand & Supply Projections for Food

grains

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According to NCAP report, India will require 280.6 million tonnes of food grains by 2020. Demand for pulses and oil seeds would increase by 140 per cent and 243 per cent respectively. India would require about 130 million tonne of rice in 2020 while requirement of wheat would reach 110 million tonne in 2020.

Food Grain Requirement Projection

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Projected Scenario of Projected Scenario of 20202020 Crop Projected

demand during 2020 by NCAP

Estimated production for 2020 (estimated by presenter )

Demand projected for Vision 2020 (by planning commission)

Supply projection for scenario of Business as usual (BAU)

Supply projection for Best case scenario (BCS)

Rice 130 117.08 119 125 207Wheat 110 105.64 92 108 173Coarse grains

34.92 15.6 13 14

Total Cereals 236.99 262.2 226.6 246 394

Pulses 43.61 42.8 19.5 16 23Total food grain

280.6 278.62 246.1 262 417

Oilseed 85.33 40.62

Table No. 20 (in million tonnes)

Source: Policy Brief on demand for foodgrains during 2020,Ramesh Chand, NCAP, New Delhi

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Govt. Measures for Food Security

•National Food Security Mission•Rashtriya Krishi Vikas Yojana•Mid Day Meal •ICDS (integrated Child Development Scheme),•National Food Security Act 2013.

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National Food Security Mission

Source: Economic Survey,2013

•NFSM was launched in Aug,2007 by GOI with an aim of achieving an additional production of 10,8 and 2 million tonnes of paddy, wheat and pulses respectively by the end of 2011-12.•A sum of Rs. 3381 crore has been spent till 31March, 2011.

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• Following table below shows the performance of Mission over different benchmarks.

benchmark years

Crop

2006-07 2007-08 2008-09

Paddy 10.97 7.63 5.14 wheat 18.09 15.33 13.22

pulses 3.01 2.45 2.64

Table No.21 ( in million tonnes)

Performance of NFSM

Note: Calculated by presenter based on data available from RBI hand book of Indian Economy, 2011-12

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2007-08 2008-09 2009-10

2010-11

2011-12

Growth in GDP for Agriculture and allied

Sectors (%), base year 2004-05

5.8 0.1 0.8 7.9 3.6

Table No. 22

Source:-Economic Survey,2013

Rashtriya Krishi Vikas Yojana•Started in 2007-08 for incentivizing states to enhance public investment to achieve 4% growth rate in agriculture and allied sectors during the 11th five year plan. During 2007-11 an amount of Rs.14598 was released.

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Mid Day Meal Scheme•100 million school children are eligible for hot meal; 50 million are getting the meals; of which 27 million also get the “4-in-one health package.”

•The scheme does not provide meals to those who does not attend the school.

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•50% of urban and 75% of rural population be covered under Act.•Guarantees providing 5 kg food grain per person per month at a subsidised rate to 67% of the country's population.•82 crore people in both urban and rural areas. •Food grains would include rice, wheat and millet at Rs.3, Rs.2 and Rs.1 per kg, respectively.

National Food Security Act 2013 National Food Security Act 2013

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•The annual food grain requirement for implementing the National Food Security Bill is estimated at 61 million tonne61 million tonne.•Out of this proposed 61 million tonnes of food grains, our 82.4 crore of targeted people require only 49.44 million tonnes and rest shall be for other institutional arrangements.

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•In year 2011-12 FCI procured 66.35 million tonnes of Food grains and off take was 56.28 million tonnes. The stock at the end of the period was 53.44 million tonnes. Hence the requirement of 61 million tonnes can be met easily without impacting the functioning of Food grain markets.

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Scheme Cost of income transfer

Public Distribution System

5.37

Andhra Pradesh Rice Scheme

6.35

Jawahar Rozgar Yojana 4.35

Maharashtra EGS 3.10

ICDS 1.80

Table No. 23 (in Rs.)

Source: Indian Economy,Gaurav Datt and Ashwani Mahajan,2013

Cost of Transferring One Rupee

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Year Amount 2000-01 12,010

2004-05 25,746

2005-06 23,071

2006-07 23,828

2007-08 31,259

2008-09 43,668

2009-10 58,242

2010-11 63,844

2011-12 72,823

2012-13 85,0002013-14 (estimated ) 124000

Table No. 24 (in Rs. Crores, at current prices)

Source: Indian Economy,Gaurav Datt and Ashwani Mahajan,2013

Cost of Food Subsidy

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•since 2004-05, UPA has doled out Rs. 32 lakh-crore by way of tax exemptions to corporate, trade and business. These exemptions are clubbed under the category ‘Revenue Foregone’ in the budget documents. For 2013-14, the ‘revenue foregone’ is Rs. 5.73 lakh crore.

Can We Sustain the Cost of Food Subsidy?

Source:- Food Security Bill could Spark grain crisis: Ashok Gulati, March 21, 2013, Times of India

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Rotting Wheat in Godowns

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Rotting Wheat in Godowns

Source:-http://articles.timesofindia.indiatimes.com/2013-05-07/india/39090187_1_global-hunger-index-wheat-ghi-score

•The Food Corporation of India (FCI) has admitted in data accessed through RTI that the amount of damaged wheat has increased from 2,010 tonnes (T) in 2009-2010 to 2,401.61 tonnes (2011-2012). •The country has already suffered a loss of 932.46 tonnes damaged wheat this year till February(2013). •Bihar has the highest quantity of rotting wheat at 306.5 tonnes, followed by Uttarakhand (221 tonnes) and Gujarat (195 tonnes).• According to data, the worst offender in 2011-2012 was Maharashtra (1444 tonnes), while in 2010-2011 Uttarakhand recorded (931 tonnes) of damaged wheat. •Gujarat had the maximum (785 tonnes) damaged wheat in 2009-2010.

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Arrangements Made For Additional Storage Arrangements Made For Additional Storage Infrastructure Infrastructure

•In the Central Pool as on July 30, 2013, the storage capacity stood at 74.6 million tonnes for food grains.• This would be supplemented by about 20.3 million tonnes with the creation of both conventional and silo capacities by private sector participation under the Private Entrepreneur Guarantee (PEG) schemePrivate Entrepreneur Guarantee (PEG) scheme.•FCI has already taken over facilities totalling a capacity of 7.3 million tonnes, while the rest is expected to be ready in the next couple of years.

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•Further, FCI will be adding capacity of 0.6 million tonnes, especially in the difficult terrain of the north-eastern states, as is envisaged in the 12th Plan.

•FCI also have the option of hiring capacities from private or public sector players, based on actual demands.

•Source:- Food Security Bill could Spark grain crisis: Ashok Gulati, March 21, 2013, Times of India

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Source:-A leaky Bucket, Times of India, May 20,2011, http://articles.timesofindia.indiatimes.com/2011-05-20/edit-page/29560838_1_welfare-schemes-centrally-sponsored-uid

How Far PDS is Benefiting Poor?

Recent World Bank report says that PDS which accounts for 1% of GDP benefits only 40% of targeted beneficiaries.

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•The Planning Commission puts the number of BPL families at 6.5 crore while the states lists add up to a shade over 10 crore households.

•Excluding the North East states, the proportion of households with ‘no card’ was highest in Orissa -- where 33 per cent of rural households did not possess any type of ration card. •In the State of Orissa which is characterized as ‘severely food insecure’ (MSSRF 2001), one-third of rural households were outside the purview of the PDS. In another 10 States, more than 20 per cent of rural households did not possess a ration card.

Source:-Role and effectiveness of PDS in assuring food Security in india: An Appraisal , Sarbapriya Ray, Ishita Aditya Ray, Journal of Economic and Sustainable Development, Vol.2, No.4, 2011

Deciding on the targeted beneficiaries of the Food Security Act 2013

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•As per the Food Security Act 2013, Section 2, sub section 7 the term “Food Security “Food Security “ means ‘the supply of the entitled quantity of foodgrains and meal specified under Chapter II’.

•According to Section 2, Sub section 8 “Food Security Allowance ” means ‘the amount of money paid by the concerned State Government to the entitled persons under section 13’.

•Thus the Act implies that we should not look for overall cover of Thus the Act implies that we should not look for overall cover of a daily man’s requirement for food but it is an attempt by the a daily man’s requirement for food but it is an attempt by the Govt. to support the food security of households.Govt. to support the food security of households.

Source: Food Security Act 2013

Is this Food Security or Cereal Security ?

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Conclusion •India will not have problem of Cereals availability in the long run (2020-21) and will have shortage of Pulse and Oilseed production if adequate steps are not taken by the Government of India.

•In absence of alternatives of Public Distribution System in future, Government shall have to continue the costly PDS.

•Given the inflationary tendencies in economy, Food Security Bill 2013 will increase the Real Income of the targeted beneficiaries.

•Sustainability of Food Subsidy is subject to operation of FRBM Act.

•To ensure success of Food Security in India we have to achieve t he Food Production Targets and improve the efficiency of public distribution system.

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Policy Implications•Attempts should be made to increase productivity of food grains

•Rather than focusing more on increasing Food Production, we must focus on distribution of Food grains in an equitable manner.

•Public distribution system must be revamped to avoid leakage and Karnataka model should be replicated.

•Attempts should be made to reduce cost of transferring benefit through PDS by way of local procurement policy.

•Attempts must be made to increase Oilseed and Pulse production at an accelerated rate to overcome the protein crisis prevailing in our country

•Storage of Food grains be made more scientific and prevent rotting of food grains.

•Need to curb the growth of inflationary tendencies in economy and more specifically Food Inflation to improve nutritional security.

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•Dietary Guidelines for Indians: A manual,2011, National Institute of Nutrition, ICMR,

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•Web sites•http://www.indiatogether.org/2012/jun/pov-nutrients1.htm#sthash.oglEKp2H.dpuf

•http://articles.timesofindia.indiatimes.com/2012-01-15/india/30629637_1_anganwadi-workers-ghi-number-of-hungry-people

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Thank You