The Hindu Business Line : India-Bharat divide after thirty years

In this era of food shortages, instead of providing incentives to farmers to produce more, the Government is deploying a battery of measures to depress farm prices. This skewed policy will only provide short-lived relief.

Sharad Joshi

The Left and the UPA circles have raised a furore against the statement made by the US President, Mr George Bush. The US President is reported to have endorsed the view expressed by his Secretary of State, Ms Condoleezza Rice that the increase in food consumption by the flourishing middle-class in India was primarily responsible for the shortage of food being experienced the world over, India included.

President Bush did not single out the Indian bourgeois alone; he bracketed it with the Chinese middle-class. But that does not make the offence any less grievous, especially for the Left parties. Some of them have gone to the extent of saying that the statement represented an interference in India’s domestic affairs. That is rather strange for a country that takes advice from American experts on economic matters practically every other day.

It is an old observation in economics that with increasing incomes the standards of nourishment rise. That does not mean that the same people gobble larger quantities of food than they did before the increase in incomes. It is irrefutable that the diet gets diversified with increases in income. Milk, meat, eggs and fruit form an increasing proportion of what they eat.

In general, producing high-protein food involves utilisation of carbohydrates thrice in weight to the final product. It would be simple arithmetic to show that the increase in the food requirement of the Indian middle-class, numbering over 35 million, is no minor quantity.

‘Unacceptable humiliation’

It is remarkable, that when an American expert cites the large size of the Indian market by referring to the demand of the prospering members of the middle-class for white goods and luxury articles, it is taken as a compliment; however, when someone talks about the consumption of food by the same class it is taken as unacceptable humiliation.

Decades ago, the father of the White Revolution in India, Dr V. Kurien, bluntly justified the taking away of milk and milk products from villages to the cities, saying that the farmers should content themselves with the vegetable proteins coming from pulses and not hanker after the more expensive milk proteins that should be spared for the urban consumer. The advice could not have come without the consent, at least tacit, of the Government.

Even the worst adversary of Mr Bush would have to concede that the present epoch, when the global prices of food-grains are skyrocketing and food-grains are in short supply because of the effects of global warming and petroleum shortages, is hardly the time for priming the pump and increasing the purchasing power in the hands of the urban consumer.

The President of the US is fully within his rights to refer to the galloping hunger of the Indian urban middle-class since it is the US which has historically been a major supplier of food-grains to India. The import of wheat by India has caused serious stresses in the international market. The President of the main supplier country has a right to make observations about this surprising upsurge in demand from a country that claimed to have godowns full of wheat only a couple of years ago.

The President is, of course, not ignorant of the policies of the Government of India to make up domestic shortages by imports of wheat, edible oils, etc. He is also aware of the fact that these policies will, in due course, discourage local production and that the problem will go on worsening, year after year.

Unexpected Argument

What Mr Bush has brought out is what the Indian farm leaders have been saying for the last 30 years. They have maintained that the Government deliberately depresses agricultural prices to keep the cost of raw materials and wage goods low.

Since the 1950s, the Government has been importing food-grains to satisfy the hunger of the urban middle-classes and that had the effect of depressing farm prices and discouraging farmers from making greater investments and putting in more labour in agricultural production.

The Government and the salaried bureaucracy have traditionally been incapable of striking the right balance between the interests of consumers and those of the producers. Farmers are a politically unorganised community and are hardly ever able to influence the elections. On the other hand, even a slight increase in the prices of vegetables, sugar and oil has produced urban middle-class wrath that has sunk many of political ships.

In 1950s and 1960s, India experienced food shortages and started to import food-grains, which were available cheap and in plenty from abroad in those years. After 40 years, history is repeating itself. We are once again in an epoch of food shortages, mainly on account of the petroleum shortages and global warming.

Skewed policy

This is a period when the Government ought to limit the purchasing power of the middle-class consumers and provide greater incentives to farmers to produce more and increase yields. The Government is doing exactly the opposite.

It is increasingly priming the pump to put more and more money in the hands of middle-class consumers and deploying the old battery of export restrictions, imports in the nature of dumping, and restrictions on transport and storage of agricultural commodities, under the Essential Commodities Act, to depress farm prices.

The skewed policy may provide only short-lived relief. There is no doubt that, in the long run, this will discourage the farmers from increasing production and therefore deepen the crisis, with each passing year. It was precisely in this situation, that I had used the expression, “neo-colonial exploitation by India of Bharat”. Thirty years later, we are back to square one. The farmers can thank President Bush for having brought out effectively the crucial duality in the Government’s policies.

Thirty years ago, the farmers movement in India had to work inch by inch to collect evidence about the anti-Bharat and pro-India policies of the Centre. This time, no less a person than the President of the United States will support the arguments.

(The author is Founder, Shetkari Sanghatana and Member of Parliament (Rajya Sabha). He can be reached at sharad.mah@nic.in)

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