Recession causes nervousness

By Kalyani Shankar

When the US President George W. Bush told the world last week that food prices are increasing because of the growing consumption in India and China, he did not expect such an outrage from India. He was not addressing the global audience but his domestic audience in Missouri during the election year. Also he was repeating what his Secretary of State Condoleezza Rice stated a few days ago on the subject as that was what the government's line is going to be to deal with the soaring price rise. Pass the buck to someone else so that there is less explaining to do on the price hike. So The Bush administration did not expect such a backlash from India when the Indian political parties hit back. There was rightful indignation on the issue and every political party tried to take maximum mileage of the controversy.

Bush may have made that statement in a different context and probably praising the growing economy of India and China as his aides claim but he should have checked on his facts before saying such things. For instance, while he had blamed the 350 million middle class in India for the rising prices, the actual consumption figures released by the FAO are different. According to the latest Global Food Market report, the highest consumption of cereal in the world was by the US in 2007 and not India or China. It had increased to 310.4 million tones as compared to the previous year's figure of 277 million tones registering an increase of 11.8 per cent. While every Indian consumes 178 kg of grains in a year, an American consumes 1046 kgs according to a US Agricultural department data. It is not the cereal alone but other things like milk, meat, and vegetable and milk product consumption also have increased in the US. What was the consumption in India during the same period? It was a mere 2.8 per cent increase from 193 million tones to 197 million tones. What about China, the other growing economy Bush mentioned? The increase in consumption was just 1.8 per cent. Food consumption in countries like Turkey and Pakistan had even declined. When these are the hard facts why did Bush blame India and China?

Bush has his own domestic compulsions. His job approval rate is at its lowest at present. Bush is in the dock for not only about the rising gas prices but also for the increase in food prices. The US media has been focusing on economy and price rise for quite some time. As the elections are getting closer, the Republicans have to answer the reason for such a slide in the economy which is becoming the biggest poll issue in the current presidential race. While the two Democratic hopefuls - Senator Barrack Obama and Senator Hillary Clinton are busy fighting each other at present, they have not spared the Republicans for the poor shape of economy. Republican nominee John Mc Cain too has to show that his economic policies will not be the same as that of Bush to ward off the criticism that if he is elected, it would be the continuation of Bush policies. Each of these presidential hopefuls has a stated position on economy be it on gas prices or tax cut or rising prices. Once the Democrats decide on the nomination, the fight between the two parties will intensify. With a sliding dollar, slow recession and loss of jobs, the candidates are in a fix to come up with credible solution. The voters are getting angry that the super markets have put a ceiling on the number of rice bags a consumer can buy.

However, until the elections are over and the new president takes over, it is for Bush to answer about the rising prices and hike in gas prices which is hitting the people hard. That was what he attempted to do in Missouri when he blamed the developing countries.

Why are the prices of food grains going up? There are three major reasons. The first as Bush had mentioned in his meeting in Missouri was the weather related problems. Some of the major food producers have had drought. The second is the renewable fuel policy and diversion to ethanol. Over 100 million tones of cereals have been diverted for bio fuel production in the US and this is likely to grow twelve fold by 2017. Admitting that he is an ethanol person Bush points out that the food prices are going up because energy costs are high. The fertilizer prices are also high which has a cascading effect on the food prices. The third is the growing demand for food in the world which had been projected clumsily by Bush. The supply is getting shorter while the demand is growing. Some countries like Australia, Argentina, Thailand, Myanmar and Vietnam have cut down their exports. Even India has banned export of non-Basmati rice varieties.

Being the leading power, the US cannot blame the other countries for the growing demand of food. It should pay heed to the warning given by the World Bank which has warned that 33 countries in the world are at risk of unrest on account of lack of food. International Monetary Fund and the UN have warned the seriousness of the issue. The problem of food price inflation is slowly becoming a global problem. It is not going to go away soon. It is far too simple to blame India and China and other developing countries for the food crisis. The US as the world leader has to make efforts to resolve the problem. The presidential race will soon show how serious the US is in tackling this grave issue. (IPA Service)

Revamp dated agro policy

By Satyendra Pratap Singh

India is facing acute food grains crisis. Jokes apart, there is some merit in US President, Mr. George W. Bush comment that "Indians are eating too much" leading to global food grains crisis. Leading political parties like the Congress, BJP and the CPI(M) criticised Mr. Bush's comment, even as Union Minister of State for Commerce, Mr. Jairam Ramesh, chose to dismiss them with ridicule. It is not eating too much or too little, the main cause for the present crisis is lackadaisical policy towards the growth of agricultural sector.

Agricultural Scientists have been saying that by AD 2020 India's population, which is now around 1.3 billion, will cross the 1.5 billion mark. Such a large population can be fed only if we make the best use of the country's land and water resources. But while water is a replenishable resource the soil is, for all purposes, a non-renewable and irreplaceable asset. It therefore makes sense to consider the problems of land management first and only thereafter those of water management. Such an approach will in fact show that both problems require the same set of solutions. If we are able to look after the land properly, the problems of water management will be automatically resolved.

Out of total land area of 266 million hectares 175 m.ha suffer from degradation, caused for the most part by soil erosion, but also by water-logging and excessive salinity. This means that, on an average, at least two out of every three acres of land in India is today in poor health. It is also known that at least half the sick land, i.e. one-third of the total, is almost completely unproductive. Another one-third is partially productive and it is only the remaining one-third which is in good health. It should be obvious, even to a superficial observer, that there is no earthly chance of producing enough food grains as a self-respecting nation, so long as such a state of affairs persists.

The most serious threat to the soil is posed by deforestation. This results in soil erosion which affects over 150 m.ha of land. Over half of this is under cultivation. It is impossible to calculate the loss caused to the economy by these processes because apart from the progressive loss of productivity which results from soil erosion the displacement of the top soil also causes the premature siltation of costly and often irreplaceable reservoirs to the detriment of irrigation, flood control and hydel generation. Again, displaced soil raises the beds of rivers, thus reducing their water-carrying capacity. This is turn causes more floods.

The excessive run-off of rain water along denuded slopes also reduces its percolation into soil and sub-soil strata and reduces the recharging of ground water aquifers. Thus an invaluable resource, which would otherwise have been available for round-the-year use as ground water is lost to the sea, often after it has wreaked terrible flood havoc on the country. Flood and droughts are thus both caused by poor land management.

This simple hydrological fact has, however, yet to be fully grasped by the country's decision makers and planners who continue to suffer from what famous agro-economists Dr. Sudhir Sen has described as "resource illiteracy". Thus, disproportionately large sums continue to be pre-empted for big irrigation projects in the mistaken belief that these offer a panacea for all our ills, even as acute problems of deforestation, denudation, soil erosion and sedimentation remain neglected for want of a sufficient awareness of the terrible toll they take of the economy.

Canal-irrigated areas, which account for around 50 per cent of the total net irrigated area of around 45 million hectares, offer the greatest scope for a quick increase in production. According to the Eleventh Plan document, thanks to the absence of field channels and proper land-shaping and drainage system over vast area, the productivity of canal irrigated land is on the average only 30 to 40 per cent of what can reasonably be expected from it. The government must therefore give the highest priority to the completion of command area development and drainage work on such lands even if this involves the slowing down or postponement of new irrigation projects. For it obviously makes better economic sense to put existing irrigation potential to optimal use first and save precious land from further damage by water-logging and salination than to create additional capacity which, under existing policies, is bound to remain under-utilised, and may well pose a grave hazard to the soil.

The 20-odd million hectares of agricultural land which is served by ground water, faces comparatively fewer problems. This is so because of the intrinsic nature of this resource, which lends itself beautifully to development by individual farmers at little expense and in record time. However, the very attractiveness of this resource creates the danger of its over-exploitation. This can result in an abnormal lowering of water tables and in areas where there are saline aquifers adjoining sweet water aquifers-as is often the case in coastal regions-it can result in a saline "infection" of the latter. Thus, there is need for a systematic investigation of the nature and recharge characteristics of groundwater aquifers and the imposition of controls over withdrawals wherever these are called for. But, above all, steps need to be taken to augment the replenishment of ground water by taking comprehensive afforestation and soil and water conservation measures in the watersheds.

In devising a rational irrigation strategy the government must take account of the many natural advantages of ground water over surface water as a source of irrigation. No expenditure has to be incurred on either storage or conveyance of ground water; no land needs to be acquired for either the reservoir or canal systems, and no seepage losses-which often amount to 50 per cent of the water released from the reservoir-have to be incurred. Ground water is also not lost through evaporation either during storage or transit.

The problems of water distribution and drainage which cause water-logging and salinisation in canal irrigated areas are also almost non-existent. In areas served by ground water because there is no seepage from canals and no interference by the latter with the natural drainage of the area. The farmer can easily plan his own distribution system and is careful not to apply an excess of water to the land. Lastly the farmer can use water for irrigation exactly when he wants to, without the intervention of a big and often corrupt bureaucracy.

It therefore stands to reason that wherever it is felt necessary to supply water to non-irrigated lands, the full potential for exploiting ground water should be exhausted before turning to the surface water options. What is more, while planning new surface irrigation projects, the government should take into account the full cost of items like command area development, drainage and the rehabilitation of oustees from submerged lands. In the past such costs have been often underestimated for cosmetic reasons.

It is time to re-examine the entire agricultural policy to make it self-sustainable by carrying out remedial measures to produce enough food for the burgeoning population. We may call it by any name, say, the Second Green Revolution. INAV