Tuesday, June 12, 2012

India considers reform of its failed food-for-poor system

Amartya Sen asserted 30 years ago that hunger is not due to scarcity, but rather to poverty, inequality, and poor management of resources.  (Sen, Poverty and Famines:  An Essay on Entitlement and Deprivation 1981).

That assertion appears to be borne out by Vikas Bajaj's recent story in the New York Times, "As Grain Piles Up, India's Poor Still Goes Hungry." The hunger problem in India, it seems, is largely attributable to a failed distribution system--a substantial part of the failure attributable to corruption.  (I have written some about these issues in relation to India's rural poor and rural development here).

Bajaj writes of rotting grain surpluses in the north of India, while slum dwellers in New Delhi go hungry.  He provides this context:
Spurred by agricultural innovation and generous farm subsidies, India now grows so much food that it has a bigger grain stockpile than any country except China, and it exports some of it to countries like Saudi Arabia and Australia.  Yet one-fifth of its people are malnourished--double the rate of other developing countries like Vietnam and China--because of pervasive corruption, mismanagement and waste in the programs that are supposed to distribute food to the poor.  
Currently, India's federal government buys and stores grain, and each state takes grain from these stocks, with the amount determined by the number of the state's residents who are poor.  The grain goes to subsidized "fair price" shops, and the states decide who is permitted to buy the cheap grain there.  The government spends 750 billion rupees ($13.6 billion) annually on the program, about 1% of the national GDP.      
Now, however, the Government of India is considering a new "food security law."  Indeed, the alternative headline for Bajaj's story is "A Failed Food System in India Prompts an Intense Review."  The new law would cost the government as much as 2 trillion rupees a year, more than twice the current expenditure.   Critics warn, however, that it will successfully alleviate hunger and poverty only if corruption in the distribution pipeline is checked, or other means are devised for getting the food assistance to those in need.  According to a recent World Bank report, just 41% of the grain that the federal government purchases reaches Indian homes.  Not only is a lot of grain diverted from the distribution pipeline, a substantial portion of it rots because it is not properly stored.  

Some reformers advocate cash payments or the use of food stamps, systems that would lead the government to buy only enough grain to ensure against bad harvests.  Such systems would also give beneficiaries food choices other than grains.  Others, however, are concerned that such a system would disserve the needy because "men would trade [food stamps] for liquor or tobacco" rather than feed their families.  

Bajaj quotes a man who advises India's Supreme Court on food issues.
The reason we are facing this problem is our refusal to distribute the grain that we buy from farmers to the people who need it.  The only place the this grain deserves to be is in the stomachs of the people who are hungry.    
What's more interesting to me than what the expert says (predictable, right?) is his role:  advisor to the Supreme Court.  Imagine an advisor on "food issues" to the U.S. Supreme Court.  I suppose this says something about the differing (or lack of) separation of powers of India, as well as a difference in advocacy systems and roles.  In the U.S., we expect parties before the Court, as well as amici, to do the advising.

Cross-posted to Agricultural Law.

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