Give Us This Day Our Daily Bread

Food Security Bill, the most important and flagship bill that the current UPA government is expected to table during the winter session has come under severe criticism from all sides of the spectrum. Fearing that it may not be passed, what with the BJP up in arms against the current regime, the government has already passed it as an interim ordinance.

Why are they in such a hurry? Obviously they can’t see the hunger suffer, you might think. Well, think again.

Ever since it was conceptualised, the food security bill has been riddled with controversies. With the shape it has taken finally, one may think they have cracked the formula. Let’s see.

India is one of the unique countries where about 230 million people go hungry every night yet we stock 700 metric tonnes a year in our warehouses, the largest procurement by any organisation in the world. Economist Jean Drèze once said that if all the sacks of grains were laid up in a row, it would stretch to more than one million kilometres, taking us to the moon and back.

The need is to take these 700 metric tonnes to those 230 million people. The Food Security Bill is touted to be the first step towards this journey. On outset, the scheme allows for 5 kg of rice to be sold at Rs. 3 per kg, wheat at Rs. 2 per kg and coarse grains at Rs. 1 per kg. These will be sold through our Public Distribution System (PDS) centres across the country.

Those from Tamil Nadu may actually laugh at this scheme. The PDS service in Tamil Nadu is hailed as one of two best in the country. Every household in Tamil Nadu gets 20 kg of free rice, 5 kg of subsidised wheat in addition to pulses, semolina, sugar and palm oil. The PDS scheme has several problems though such as pilferage and grains sold in black markets, etc., but so far no other state in India has even come close this kind of massive hunger intervention.

Except, of course, Chattisgarh, the second state where PDS works at its best, where it provides 35 kg rice, pulses and 2 kg salt. Their PDS centres even offer other value-added services such as micro-financing for farmers. Raman Singh, the Chief Minister of Chattisgarh is also credited with implementing software systems in all their warehouses that has led to tracking and monitoring of grains that led to reducing the leakages to below 4%.

Considering these success stories, the food security ordinance appears pathetic. Also, this ordinance is not seen to be backed by any visible plan to upgrade warehouses, increase the distribution systems or reduce rotting of grains FCI godowns. It entrusts the responsibility of corruption-free implementation to state enforcement agencies, which will become a serious failure in states like UP where the honesty or integrity of state enforcement agencies is nothing but a joke. In states like TN and Chattisgarh, however these schemes won’t make any difference, as they are already doing far more than the ordinance has conceptualised.

The food security ordinance doesn’t appear to have learnt anything from these two successful schemes, surprisingly considering the number of iterations it went through and the multiple committees that ‘refined’ and ‘vetted’ it.

The centre government could have worked with these two states to get the best out of them and worked actively with the other state governments to implement them universally. They haven’t bothered to do that. In these nine years of the UPA regime, there hasn’t been any attempt to upgrade the warehouses, build new ones, implement better grain preservation, etc. The two star states that stand out on PDS are both non-Congress governments. If the food-security implementation was a problem working with states ruled by non-Congress parties, UPA government would have worked with Congress-ruled states and shown them as the flagship programmes and success stories. With so much of talk by Sheila Dixit about setting the limit for the Below Poverty Line, even Delhi hasn’t done anything about the PDS, except the CM famously declaring that 35 rupees should be enough for 5 people to eat. May be it is, unless those five people walk into the Amma Canteen.

Anyway, on the outset the ordinance seemed to be riddled with problems and unanswered questions. Aside from the implementation issues, there are other economic consequences as well for which there are no answers. For instance, consider the following:

  • What the central government would do about the huge subsidy bill that is going to fall on its lap. Some claim that the bill would be 1.5 lakh crores whereas some claim that it would only add 15,000 crore to the existing bill.
  • What will be the effect of the central government procuring additional grains required to meet the grains? What if it reduces the inflow of rice to the open market and as a consequence causes the prices of rice to go up?
  • Finally, what if, due to some major drought, the government is unable to procure enough grain from the domestic market? Will it procure more from the open market pushing its bill and the prices up? Or will it import grains?

Of course, why the UPA is in a hurry to pass the bill is no secret to anybody. They know that these ‘problems’ are only in fine prints and only economists and some worthless analysts like this writer will be bothered about them. To the public, ‘Five kg rice, wheat and pulses to your household’ will be a slogan as catchy as ‘Garibi Hatao’ and will help them wipe out some of the mal-governance issues plaguing the current regime. Whilst the economists and intellectuals rack their brains with the nuances of the draft bill, UPA hopes to walk away with sacks and sacks full of votes, weighing approximately 700 metric tonnes. In this respect the scheme works more like the Vote Security Ordinance.