Feeding the Hungary or FDI in Retail?
By Devinder Sharma *
There is something in India's decision making that I can never understand. For over a year, intense discussions have followed the proposals under the upcoming National Food Security Act. The Plan A included provisions of 35 kg of subsidised foodgrains per family for the below the poverty line (BPL) category and allowing those above the poverty line (APL) an entitlement of 15 kg at a relatively higher prices.
Feeding the hungry by providing them legal entitlements comes at a time when policy makers remained glued to opening up for FDI in retail. Amidst the continuing debate whether FDI in retail is good for India or not, US President Barack Obama throws his weight pitching for a new wave of economic reforms. After the TIME magazine came out with a cover story calling Prime Minister Manmohan Singh 'underachiever' (which ostensibly was to provoke the PM to go in for FDI in retail), it was surprising to see President Obama telling India what is good for us.
But then, President Obama knows what is in America's interests. He stopped outsourcing (even if it hit Indian companies) of jobs because he wanted to protect US jobs. And now since he goes into elections with nothing to show, he is actually banking upon India to bail him out of the terrible economic crisis that he is faced with back home. Manmohan Singh has therefore deputed Commerce Minister Anand Sharma to go around and build up a political climate in favour of FDI in retail. No one is surprised when Anand Sharma says that the opposition to multi-brand retail is less intense now (See the lead story in Economic Times, July 16, 2012 http://articles.economictimes.indiatimes.com/2012-07-18/news/32730673_1_russian-economic-entities-russia-s-sistema-investments).
Any sensible economist, and for that matter any nationalist, would ensure that the hungry in India are first well fed. What may appear to be a welfare activity, and is supported by government subsidies, also makes terrible economic sense. Feeding the hungry millions, on a war footing, is a sure recipe to an inclusive growth. I had thus expected the Indian PM to pitch in for an early implementation (and not wait for the 2014 elections) of the National Food Security Act. A news report in Indian Express (Food Bill: Govt looking at flexible plan, may exclude 33 % population; link - http://www.indianexpress.com/news/food-bill-govt-looking-at-flexible-plan-may-exclude-33-population/976392/) tells us that an alternative proposal is now being drafted, which will lower the food entitlement from 35 kg to 25 kg per family, and also do away with the two categories -- BPL (priority) and APL (general).
I don't understand how can the Plan B (as it is called) envisage an additional expenditure of only Rs 7,000 crore over and above the Rs 1.11 lakh crore of legally binding food subsidy. It should be much lower considering that 33 per cent of the population stands excluded, and the legal entitlement has been reduced for bulk of the hungry population. Nevertheless, jugglery with figures is something that the government regularly indulges in to keep the nation misinformed for all times to come. We as a nation rarely question the figures that are doled out to us.
I thought the Prime Minister would know what is crucial for India. Feeding the nation, and that too after we failed for 65 years, should be the sole priority. However, he doesn't mind excluding the percentage of population to be fed, by 33 per cent but has focused all his energies to bail out President Obama instead. he knows that by allowing FDI in retail he is actually going to add on to hunger by displacing lakhs of people working in the local stores. Such a magnitude of displacement will only add on to growing hunger.
But then, we are aware that Manmohan Singh knows what is good for America.
Feeding the hungry is not the only area where Indian Prime Minister is least interested. He would have given a damn to food security if it were not for the UPA President Sonia Gandhi's insistence. Earlier too, if you recall, when MNREGA was launched, Manmohan Singh, and the then Finance Minister P Chidambaram, had strongly opposed the move. If it were not for Sonia Gandhi, the poor unemployed wouldn't have got any relief in the form of a guaranteed employment even if it is only for 100 days.
Manmohan Singh is not the only bureaucrat-turned-politician who feels, and works for the American interests. Besides the ambitious-looking bureaucrats (who crave to join MNCs after they exit government service), economists and management consultants are of course on the payrolls. But what about the Indian media? Why is the Indian media playing to the American tune? Well, I don't have to explain it to you. You know it much better. It is all about money, my dear. Who cares for the hungry?
* Devinder Sharma is a food and agriculture policy analyst. His writings focus on the links between biotechnology, intellectual property rights, food trade and poverty. His blog is Ground Reality http://devinder-sharma.blogspot.in/