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Our Bureau

Mumbai, May 25

Stating that the complex causes of the current food and agriculture crisis required a comprehensive response, the Washington-headquartered International Food Policy Research Institute (IFPRI) has come up with two sets of policy actions that include an emergency package and a resilience package.

Most of these policy prescriptions target governments, the United Nations, NGOs and the civil society for action, with a view to encouraging food supplies expeditiously.

Given that rising food prices hurt the poor the hardest (a large number of the world’s poor are in food-insecure countries of Africa, Asia and Central/South America), the priority is to expand emergency responses and humanitarian assistance to food-insecure people, and people threatening government legitimacy.

Export bans and restrictions recently imposed by a number of countries (including India) have caused food shortage in many importing regions. Withdrawal of export controls is seen as a sure way to augment availability in food-deficit countries and help equitable distribution.

Undertaking fast-impact food production programmes by strengthening supplies of inputs in key areas such as Africa countries can help augment food production and generate incomes for growers.

A change in biofuel policies by placing a moratorium on use of traditional food crops such as grains and oilseeds for fuel purposes can help release more of these for non-fuel purposes (food and feed). IFPRI estimates this measure alone will have a salutary effect on prices of grains such as maize (corn) and wheat.

Elimination of mandated blending and subsidies will also help rein in grain and oilseed prices.

In the second set of actions called the resilience package, the agency has suggested ways to calm markets with measures that would ensure market-oriented regulation of speculation, shared public grain stocks, strengthened food-import financing, and reliable food aid.

While suggesting that speculation was mainly a consequence, not a cause of price crisis, the research agency has ruled overregulation and market policing as inappropriate responses. It has recommended that surveillance and regulatory measures such as monitoring speculative capital or limiting futures trading, should be taken to curb excessive speculation in agricultural commodity markets.

For instance, policymakers could set maximum limits on trading positions, increasing the margin deposit requirements to minimise speculative capital. Investment in social protection, scaling up of investments for sustained agricultural growth and completion of the Doha Round of WTO negotiations are seen as other measures.

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Food research institute moots withdrawal of export controls

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