As India unlocks, farm and food systems must be made resilient

G Chandrashekhar | Updated on June 22, 2020

Apart from the ongoing pandemic, the agriculture sector continues to face the risks of climate change, water shortage and land constraints. Policymakers must de-risk the sector with appropriate policy, research and investment support

Amid the Covid-19 pandemic and national lockdown since March 25, when both the manufacturing and services sectors were badly hit, the agriculture and food sector stood as a beacon of hope, only to prove yet again that food security is next only to national defence security.

Admittedly, in the beginning the lockdown did adversely impact agriculture and related activities as marketing yards were closed, labour was unavailable, transportation had come to a standstill, and supply chain was disrupted. The whole nation was in a state of ‘forced inactivity’ for a period of time.

Supply chain dislocation meant there was no processing of food raw material (milling of grains like rice, wheat, pulses; crushing of oilseeds for edible oil production and so on), nor was there a functioning distribution mechanism — from farm to food processing factories to food retail. Panic buying by consumers resulted in supply tightness, shortage at the retail level and inevitable price rise, especially in the month of April.

But soon policymakers realised that agriculture and food ‘cannot wait any longer’. Restrictions were eased. Marketing yards were gradually reopened. Trucking service resumed slowly. Processing mills started to buzz again with activity, albeit on a lower scale. By mid-May, there was substantial easing of food supply tightness.

Key lessons

Now that the country is unlocking with caution, what can we look forward to? The pandemic has taught us some lessons. From here on, a key component of the national response ought to be to build ‘resilience’ in every aspect of life. Agriculture and food systems are most critical for our country; but there are serious risks threatening the sector — not only the ongoing pandemic, but also climate change, water shortage, land constraints and even terrorism from a bio-security perspective.

It is a matter of concern that agriculture and food sector could be the victim of any or all of these risks. So, it is critical that policymakers recognise the looming risks and take steps to de-risk the sector with appropriate policy, research and investment support. We need to protect our food system by designing real-time response to any looming threat.

There’s another lesson the pandemic has taught us. Should we be chasing cost efficiency alone in business? As critical as cost efficiency is resilience. So, businesses must now start to move towards not only maximising cost efficiency, but also building resilience to be able to effectively overcome the risks. For farm and food business this becomes even more critical as they are the nation’s lifeline. To be sure, it is not efficiency versus resilience, rather ‘efficiency and resilience’.

To put it differently, we not only have to practice ‘climate-smart’ agriculture, but also ‘crisis-smart’ agriculture. We need to recognise that far from being separate or disjointed, agriculture and food systems are a continuum. To bolster its ability to face perceived threats, it is necessary to build partnerships and collaborations among all stakeholders covering input suppliers, growers, output processors, researches, financiers, service providers, policymakers, and so on.

Address the challenges

Each one of the above is an integral part of the chain; and as the saying goes, ‘a chain is as strong as the weakest link’. Indeed, this is what must form the bedrock of our Atmanirbhar Bharat campaign (Self-reliant India). Self-reliance is not isolationism or protectionism or cutting ourselves off from the rest of the world — it will not work in practical terms as there are inescapable interdependencies. Self-reliance is our ability to address our internal challenges on our own without depending on outside assistance.

As India begins to unlock, economic activities in the manufacturing and services sectors will begin to revive. But there are and will be challenges of business viability, liquidity and labour availability. It will take at least three months — that is, July-September or the third quarter of 2020 — for businesses to review, revive and revitalise.

By the last quarter, hopefully, the country’s economic activities should recover substantially, if not to the pre-Covid levels, but at least modestly close to it. For this to happen, the stimulus package announced by the government needs to be implemented in letter and spirit. Banks have a critical role to play in ensuring the success of the stimulus package. Otherwise, revival hopes will be pushed to the second half of 2021.

The writer is a policy commentator and agribusiness specialist

Published on June 22, 2020

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