Political and Economic Future of India - Impact of Food Insecurity

Political and Economic Future of India -Impact of Food Insecurity

Economic and Political Significance of Indian Seed Industry : Are we ready to play the bigger game?

By:

Vijay Sardana

Bio-economy, Innovations & Food Security Expert

Blog: “Vijay Sardana Online”

Significance of Agriculture for India’s economic and Political stability is becoming critical.

Some hard facts:

·  More than 52 % population of India is directly involved in agriculture sector i.e. about 600 million people

· About 74% of India’s population earns their livelihood through direct and indirect from agriculture.

·  22% of India’s population is below poverty line. If we go by Food Security Act about 60% population of India needs food safety coverage.

·  About 60% of total land is used for Agriculture activity in India.

· India’s 490 million labor force mainly comes from rural India.

·  According to FAO, Malnutrition situation in India among the child below the age of 5 years is worse than Africa. It is more than 40% according to some reports.

·  Under all these stressful situations, India still exports about USD 40 billion worth agriculture and agro-based exports.

·  About 650 million livestock is also dependent of agriculture for feed and fodder.

· Only 17% of national GDP is contributed by Agriculture.

·  In order to meet the shortfall of Edible oils and pulses, we import material worth USD 25 billion. The way prices and import demand is going up, India will import agriculture and food material worth USD 100 Billion per year.

Based on these facts I have three question to Government of India: 

1. Do we have enough protein to ensure health life of every human and animal in the country? Yes or No.

2. Why when this basic requirements will be fulfilled to ensure healthy life. Indicate the year.

3. Is there any plan with Government of India to ensure minimum protein availability as per Indian Council or medical Research? Pl. issue a press release for media so that citizens can read.

There can be no argument about the crucial importance of food security for any society and nation. Food is a very strategic issue since ages. In changing geo-political conditions in the world, control of food and fuel supplies is of strategic and political significance.

For Country like India, Agriculture mainly food security is foundation of social and political co-existence, because without food security there is political stability, antisocial elements will use these opportunities to create social  and religious disturbances. 

Why food security is crucial for national economic and foreign policy?

Imagine if food prices goes up by 100% in next 5 years, what will happen to the consumers below poverty line, what will happen to the labour cost, what will happen to the raw material, what will be the impact of cost of money on businesses and employment. 

For some countries it is just another activity because in those countries, only 2 to 5% population is depended on agriculture but for India, where 70% population is dependent on agriculture and where food security is already a growing challenge, can hungry and under-nourished people accept peaceful social and political order? 

Think about it.

High voltage and aggressive negotiations and debates on Agreement on Agriculture at WTO meetings are clear examples that food security and bio-economy are non-negotiable because no country whether small or big would like to compromise on food security.

Quiz for you all:

1. Which are the Naxalite affected areas in India?

2. Which are the food insecure area?

Any country without food security cannot have independent economic and foreign policy. It is well known fact that any country who is offering food and fuel to other country to stabilize the economy for its existence will try to influence the policies of the receiving country in their favor. Nothing is free in today’s world. Strategically, food is also weapon. The collapse of USSR and many economies in the past was due to shortage of food. History tells us many things. let us not repeat the history. Civil wars and social unrest was due to excessive food inflation and shortage of food. There is conscious attempt by major global political power to capture or influence the food security of other nations to enhance their political and strategic reach.

Tools used to influence food security around the world:

In order to control or influence the food security of other country there are many ways by which this can be done. The most powerful and sensitive too is by controlling the factors of production and also influencing their viability or availability.

The major factors of production in agriculture are:

1.   Soil

2.   Seeds

3.   Water

4.   Agro-chemicals

5.   Climate

6.   Labor

7.   Equipment and machines

8.   Fuel

Out of these major factors of product the few can be controlled by trade laws and some other can be influenced by social and environmental laws.

National Food Security and Trade Laws:

Inputs like seeds, agro-chemicals, equipment and fuel are tradable products. There is an attempt to control or influence the availability, quality and cost of these inputs in one way or the other.

Tariff and non-tariff measures are used to influence the supply and cost of these products in the world market.

There are various agreements under WTO which are used to influence these aspects in domestic policies of various countries. Some of the important agreements are:

1.   Agreement of Agriculture

2.   Agreement on Trade related Intellectual property rights

3.   Agreement on Technical Barriers to Trade

4.   Agreement on Sanitary and Phyto-sanitary Measures

5.   Agreement on Trade facilitation

6.   Agreement on Procurement

In this article let me discuss about just one input i.e. Seeds:

Industry Seed Industry: Time for Strategic Thinking

As we all know seed is very vital input for any crop. In today’s world, there is serious attempt by all the governments to control the source of natural resources in one way or the other whether it is energy sources, mineral source or genetic sources. In this fight, there is no consideration who is actually the original owner of these vital resources. People those who have imperialistic mindset still have tendency to garb what is available at whatever cost –fair and unfair is not a criteria.  Starting from Gulf War to trade war under WTO, one thing is very clear, the fittest will survive. There is no question that any country will compromise and will allow others to take foothold in their strategic objective in the game of food security and energy security.

Indian Seeds Industry is Part of the Chess Game under WTO

Every Politician and business leaders, irrespective of his or her reach and size, understands the role of food and fuel in any society. The easiest way to influence any political and economic decisions of any country is by influencing or controlling food and fuel supply.

It is not surprising to note that even after signing WTO agreement and also advocating fair and transparent trade, none of leading industrial countries and the world powers are willing to compromise on agriculture and food security. Not a single developed country is willing to reduce the subsidies to agriculture sector; none of them is willing to relax the rules by which their food society is compromised. Many countries treat seed as a strategic sector and even don’t allow more than 49% FDI in seed sector.

Is seed sector ready to play a bigger role in Indian’s food security?

The source of food is seed. The best way to control food security is control the seed supply of that country. Seed is a major multiplier factor in food security. If this is right, in this case it is very important for us to understand the role of seed sector not just a trading or commercial activity but as sector which is of strategic significance for any country.

It is high time when leaders of seed industry and political leaders should sit together and study the seed policies from all major countries of the world and understand the reason why they have taken certain action and why?

It is also important to understand and read between the lines why certain countries are very rigid in their agriculture policies?

If certain countries have extended any concession in certain sectors of agriculture, in that case please read what is the impact of the same on long term food security of the country and on the seed sector of that country.

Why any country should be interested in making India food secure?

No country in the world is keen to make India food and energy secure. It is not in their trading, political and strategic interest. India is a huge country / market with 1250 million people, with very important strategic location. They all know, poor productivity in agriculture and food insecurity is huge business opportunity for them. Food inflation in India will ensure that India’s economy continue to struggle so that India’s industrial sector continue to suffer. This means competition from India in world market can be minimized. This will also limit resource generation for government of India and will aggravate political turmoil and policy paralysis.

Why seed sector will be key for India’s economic independence?

We feel very happy when we have surplus production of carbohydrates like wheat, rice and sugar. At the same time we have failed to address the growing deficit of protein and edible oil which are vital for healthy and productive life.

At the same time, as a country we failed to give due important to seed sector in India. The whole focus of seed sector is mainly towards carbohydrates and fibers which are either surplus in India or of industrial use. These products are of limited significance for healthy India. Productivity of protein and oil rich crop is of national importance. This degradation of pulses and oilseeds supplies is an outcome of continuous ignorance of ground realty by keeping short term trading interest alive by compromising long term national interest.

Limiting Factor in Improving Productivity in India:

·        Availability of Seeds
·        Availability of Energy
·        Poor soil health leading to poor response to fertilizer 

        and irrigation
·        Growing Biotic stress
·        Degradation of genetic resources
·        Destruction of crop diversity and promotion of mono-

        culture

Agriculture Policy and Seed industry Leaders must tell the nation, what their views on the following are:

·  What changes in productivity and cultivated areas will be needed to grow the additional food & feed incl. pulses, oilseeds and fodder for securing India’s food security.
·  Will the identified regions be able to produce additional food to ensure food security?
·   Do we have suitable seeds for these new regions?
·  What is the future of small seed companies? Learning from Edible oil sector is vital. Oil sectors wanted decontrol with the assumption that it will help small companies to grow, but today all small scale industries are suffering and about to close and edible oil industry is depended on imports. What is the future of small seed companies in India?
·  Who will control the genetic resources and seed industry of India? Whoever will control the genetic resources will decide the future of India’s food security?
·    Seed is going to be technology driven in coming days, what should be the technology fee and royalty for technology in India. Recently, Commerce and Industry Minister of India said India should have Guidelines for technology feed and royalty payments. IS seed industry ready with the suggestion?
·  NGOs are raising issues against promotion of monoculture, cartelization and stacking traits in seed industries? These concerned are not invalid? What is our response to them?
·   What about biodiversity in India? In last 80 years, globally we have lost more than 92% of biodiversity in crops which are commercial oriented. What is the future of biodiversity in India where seed companies are focusing?
·  Large scale imported fresh fruits and vegetables are also bringing bio-security threat into India. In poultry industry we have seen how bird flu is impacting the sector. What about new diseases in crops and plants. Who is monitoring and controlling entry of exotic diseases into India.
·        Bio-terrorism, Bio-piracy and Bio-security are new dimensions in world policy environment. If we see these dimensions under the WTO regime, countries will play these non-tariff cards to protect their commercial interest. Are we ready to address these issues and protect our country from these threats?

These questions need serious thinking because these questions will decide survival of your business.

You can choose to ignore the facts, but facts remain:

If you will ignore now, you will compromise your business and your existence.  Once these things go out of control in large economy like India, it is very difficult to bring back the management and policy control by ignoring vested interest inside and outside India. For example, see the example of edible oil India. Future will tell what the contribution of current leadership was.

Sales, marketing revenue generation and business proportion are routine job for all business managers to meet day-to-day challenges. But, what about future of India’s food security? How much time and energy our political and business leaders are devoting to ensure India’s food security?

The way things are happening, I am not comfortable. Are you sure they will make India food secure? Think about it.

If India’s food security is not protected, who will protect India’s seed sector. If food is not secure, India’s economic policy and foreign policy cannot be independent and cannot secure strategic India’s interests.

Food will decide who will win this political and business war on global stage. Food production related technologies will be used by our adversaries’ to win this game. Seed is an important weapon in this whole game.

Let us monitor every month (not every year), how much food we are importing into India and at what price. How much foreign exchange is going out from India? This will help us in monitoring what is happening with our food security.

Today, our food and agriculture based import is worth USD 25 billion, by 2020 it will touch US 100 billion. All the gains from IT exports will be used just to feed India. We will import food to feed human beings, what about livestock sector. They also need better feed to remain productive. High yielding animals need more nutrition than human beings. By 2020, India will have shortage of feed and fodder worth USD 150 billion.

Yes, I am very worried the things are going. I can see India as a major food importing country and food inflation and food security will dominate political agenda in India in years to come. 

Future will tell, what was the capability and vision of our present leaders and decision makers.

I wish you also read "Misplaced Agenda", Click the link at - 

 http://sardanavijay.blogspot.in/2012/09/misplaced-agenda-food-security.html 

I wish I am wrong. 

As a visionary for India, what is your opinion? Please do let us know, do write in comments section below.