QUESTION : Discuss the key achievements in food production in India and major challenges before food security with effective steps to assure food security. Comment
The Hindu Editorial Topic : LESSONS FROM INDIA’S FOOD SECURITY RESPONSE
Food Security In India
WHY IN NEWS ?
- The State of Food Security and Nutrition in the World’ estimates that around a tenth of the global population, up to 81.1 crore persons, were undernourished in 2020.
- In this context, it is important to focus on the COVID-19 pandemic’s disruptive impact on the food security and livelihoods of the poor and marginalised.
- However, India has made enormous progress in food production over the years.
INDIA’S ACHIEVEMENTS IN FOOD PRODUCTION AND FOOD SECURITY :
- In 2020, India produced over 30 crore tonnes of cereals and had built up a food stock of 10 crore tonnes. India has registered record harvests over the last few years.
- India exported a record 1.98 crore tonnes of rice and wheat in FY21.
- In COVID-19, vulnerable and marginalised families in India were protected against the food crisis by its robust Targeted Public Distribution System (TPDS).
- Union government allowed the states to lift their allocations for six months in one go, in anticipation of a surge in demand for foodgrains through the public distribution system.
o Earlier, Public distribution system (PDS) beneficiaries can take grains in advance for maximum two months.
o Also, the spike in the uptake of subsidised and free foodgrains during the lockdown shows the robust effectiveness of PDS.
- Government of India increase entitlements given to National Food Safety Act (NFSA) beneficiaries in 2020.
o Under Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), 81.3 crore NFSA beneficiaries received an additional 5 kg of foodgrains per person per month and 1 kg of pulses per family per month, free of cost for 8 months (from April to November 2020).
During the third phase of PMGKAY in 2021, 89% of the allocated foodgrains were distributed to beneficiaries.
o Under the Atmanirbhar Bharat package, 8 crore migrants were provided 5 kg of foodgrains per month, free of cost.
- The government also allowed NGOs/civil society organisations to buy rice and wheat at subsidised prices directly from nearby Food Corporation of India (FCI) warehouses.
o Rice was sold at ₹22 per kg (market price is ₹35 per kg) and wheat at ₹21 per kg (market price is ₹27 per kg).
REASONS FOR EXISTING FOOD INSECURITY IN INDIA :
(1).In rural and tribal areas:
Low Productivity: This is mainly due to a lack of improvement in agricultural productivity owing to inadequate resources and markets needed to obtain agricultural stability.
Lack of education and job opportunities- in rural areas have further added to the problems.
Climate change: has an impact on agricultural productivity, which affects the availability of food items and thus, food security. A major impact of climate change is on rain-fed crops, other than rice and wheat.
Backwardness: For the tribal communities, habitation in remote difficult terrains and practice of subsistence farming has led to significant economic backwardness.
(2).In urban population:
Migration: Rural-to-urban migration has shown a gradual increase, with its share in total migration rising from 16.5% to 21.1% from 1971 to 2001. The emergence of these rural origin pockets in the urban areas has resulted in a number of slum settlements characterized by inadequate water and sanitation facilities, insufficient housing and increased food insecurity.
Affordability: Another important point which might promote food insecurity is the dependence of this labourer class on daily employment wages which tends to be variable on different days of the month and thus the food procurement and access are also fluctuating.
Access: All the privilege of the government schemes and programmes, aimed at helping the urban slum people, is enjoyed only by those slums that are notified. Ironically, around 50 % of the urban slums are not notified and thus are deprived of the government schemes.
(3).In children and mothers:
Poverty: The children are food insecure because of factors attributed to overpopulation, poverty, lack of education and gender inequality.
Lack of adequate knowledge: amongst mothers regarding nutrition, breast-feeding and parenting is another area of concern
Gender inequality: places the female child at a disadvantage compared to males and causes them to suffer more because they are last to eat and considered less important.
(4).Faulty food distribution system:
Inefficiency: Inadequate distribution of food through public distribution mechanisms (PDS i.e. Public Distribution System) is also a reason for growing food insecurity in the country.
Inclusion and Exclusion: The Targeted Public Distribution System (TPDS) has the disadvantage in the sense that those people who are the right candidates for deserving the subsidy are excluded on the basis of non-ownership of below poverty line (BPL) status, as the criterion for identifying a household as BPL is arbitrary and varies from state to state. The often inaccurate classification as above poverty line (APL) and below poverty line (BPL) categories had resulted in a big decline in the off-take of food grains.
Quality issue: Low quality of grains and the poor service at PDS shops has further added to the problem.
(5).Unmonitored nutrition programmes:
Inefficient implementation: Although a number of programmes with improving nutrition as their main component are planned in the country, these are not properly implemented. For instance, a number of states have yet to introduce the Mid Day Meal Scheme (MDMS).
In states such as Bihar and Orissa where the poverty ratio is very high, poor implementation of nutritional programmes that have proven effectiveness has a significant impact on food security
(6).Lack of intersectoral coordination:
Lack of coherent food and nutrition policies along with the absence of intersectoral coordination between various ministries of government such as Ministry of Women and Child Health, Ministry of Health and Family Welfare, Ministry of Agriculture, Ministry of Finance etc have added to the problem.
CHALLENGES TO FOOD SECURITY :
Climate Change: Higher temperatures and unreliable rainfall makes farming difficult. Climate change not only impacts crop but also livestock, forestry, fisheries and aquaculture, and can cause grave social and economic consequences in the form of reduced incomes, eroded livelihoods, trade disruption and adverse health impacts.
Lack of access to remote areas: For the tribal communities, habitation in remote difficult terrains and practice of subsistence farming has led to significant economic backwardness.
Increase in rural-to-urban migration, large proportion of informal workforce resulting in unplanned growth of slums which lack in the basic health and hygiene facilities, insufficient housing and increased food insecurity.
Overpopulation, poverty, lack of education and gender inequality.
Inadequate distribution of food through public distribution mechanisms (PDS i.e. Public Distribution System).
o Deserving beneficiaries of the subsidy are excluded on the basis of non-ownership of below poverty line (BPL) status, as the criterion for identifying a household as BPL is arbitrary and varies from state to state.
Biofuels: The growth of the biofuel market has reduced the land used for growing food crops.
Conflict: Food can be used as a weapon, with enemies cutting off food supplies in order to gain ground. Crops can also be destroyed during the conflict.
Unmonitored nutrition programmes: Although a number of programmes with improving nutrition as their main component are planned in the country but these are not properly implemented.
Lack of coherent food and nutrition policies along with the absence of inter-sectoral coordination between various ministries.
Corruption: Diverting the grains to open market to get better margin, selling poor quality grains at ration shops, irregular opening of the shops add to the issue of food insecurity.
INDIA’S NATIONAL NUTRITION STRATEGY :
The Strategy aims to reduce all forms of malnutrition by 2030, with a focus on the most vulnerable and critical age groups.
The Strategy also aims to assist in achieving the targets identified as part of the Sustainable Development Goals related to nutrition and health.
The Strategy aims to launch a National Nutrition Mission, similar to the National Health Mission.
This is to enable the integration of nutrition-related interventions cutting across sectors like women and child development, health, food and public distribution, sanitation, drinking water, and rural development.
A decentralised approach will be promoted with greater flexibility and decision making at the state, district and local levels.
Further, the Strategy aims to strengthen the ownership of Panchayati Raj institutions and urban local bodies over nutrition initiatives.
This is to enable decentralised planning and local innovation along with accountability for nutrition outcomes.
The Strategy proposes to launch interventions with a focus on improving healthcare and nutrition among children. These interventions will include:
- Promotion of breastfeeding for the first six months after birth,
- Universal access to infant and young child care (including ICDS and crèches),
iii. Enhanced care, referrals and management of severely undernourished and sick children,
- Bi-annual vitamin A supplements for children in the age group of 9 months to 5 years, and
- Micro-nutrient supplements and bi-annual de-worming for children.
Measures to improve maternal care and nutrition include:
- Supplementary nutritional support during pregnancy and lactation,
- Health and nutrition counselling,
iii. Adequate consumption of iodised salt and screening of severe anaemia, and
- Institutional childbirth, lactation management and improved post-natal care.
Governance reforms envisaged in the Strategy include:
- A convergence of state and district implementation plans for ICDS, NHM and Swachh Bharat,
- Focus on the most vulnerable communities in districts with the highest levels of child malnutrition, and
iii. Service delivery models based on evidence of impact.
WAY FORWARD OR SUGGESTIONS FOR IMPROVING INDIA’S FOOD SECURITY :
(1) Community awareness through IEC activities and social marketing
Need-based IEC and training materials should be developed for effective dissemination of nutrition messages.
Local community education on key family health and nutrition practices using participatory and planned communication methodologies will be helpful.
Incorporating health and nutrition education into the formal school curriculum for girls and adult literacy programmes could greatly improve women’s health and nutrition.
Social marketing of iodized salt, iron and folic acid and vitamin A supplements, nutritious food mixes and other low-cost vitamins/mineral preparations will prove to be beneficial.
(2) Introduction of the One Nation One Ration Card (ONORC) scheme
- ONORC scheme can allow beneficiaries to access their food entitlements from anywhere in the country.
o The scheme takes the massive digitisation of the supply chain, distribution and access to the next step, ensuring anyone benefits from anywhere in India.
- This is especially important for a country like India with a massive mobile population and migration between States.
(3) Implementing measures to improve agricultural productivity and food storage
The government policy needs to adopt an integrated policy framework to facilitate the increased use of irrigation and newer farming techniques.
(4) Climate resilient solutions
- Massive efforts are needed towards programmes that focus on building resilient agriculture that is adaptive to changing weather.
- It also needs introduction of newer varieties of crops, efficient irrigation systems, and the promotion of crops as per the agro-climate zones.
(5) Less food wastage
- There should be enhanced efforts to prevent food losses.
- Lost or wasted energy used for food production accounts for 10% of the world’s total energy consumption.
- Annual greenhouse gas emissions associated with food losses and food waste is 3.5 gigatonnes of the CO2 equivalent.
(6) India’s role in international institutions
- The outcomes of the upcoming UN Food Systems Summit, the Nutrition for Growth Summit and the COP26 on climate change will shape the actions of the second half of the UN Decade of Action on Nutrition.
- India has a central role to play in this transformation and offering solutions to address the thought processes and models for equitable and food-secure world.
(7) Addressing the rising cost of nutritious diets
Nutritious diets are highly unaffordable.
Three out of four rural Indians cannot afford a nutritious diet, according to the article, Affordability of nutritious diets in rural India recently published in the journal Food Policy.
Between 63 and 76% of the rural population of India in 2011 could not afford the recommended diet.
The COVID-19 pandemic has drawn attention to addressing the aspects of access and portability of food entitlements.
Although the scale of India’s public food distribution systems is immense and has gone through constant improvement, more needs to still be done to holistically improve the food access and distribution system.
QUESTION : Discuss the pros and cons of Central Bank Digital Currency (CBDC) .
The Hindu Editorial Topic : MONEY CHANGER
Need for an official digital currency
WHY IN NEWS ?
The Reserve Bank of India is planning to launch Central Bank Digital Currency (CBDC) in the near future.
- In recent years, the significant rise of private cryptocurrencies such as Bitcoin and Ether has spooked central banks throughout the world, and pushed the case for official digital currencies.
- The Deputy Governor of RBI himself cited a 2021 BIS survey of central banks, which found that
o 86% were actively researching the potential for such currencies,
o 60% were experimenting with the technology, and
o 14% were deploying pilot projects.
- China, having already engaged in pilot projects for its digital RMB, is in fact planning a major roll-out soon. There has been little doubt, therefore, that India needs a digital rupee.
- The important questions are about the details and the timeline.
MORE DETAILS OF THIS NEWS :
- RBI is currently working towards a phased implementation strategy and examining use cases which could be implemented with little or no disruption.
o The clarity is welcome, given that the much-awaited Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, is yet to be introduced.
- Conducting pilots in wholesale and retail segments may be a possibility in near future.
- A High Level Inter-Ministerial Committee constituted by the Ministry of Finance in November 2017 to examine the policy and legal framework for regulation of virtual currencies had recommended the introduction of CBDC.
NEED OF DIGITAL CURRENCY
o Addressing the Malpractices:
The need for a sovereign digital currency arises from the anarchic design of existing cryptocurrencies, wherein their creation, as well as maintenance, are in the hands of the public.
With no government supervision and ease of cross-border payments, renders them vulnerable to malpractices like tax evasion, terror funding, money laundering, etc.
By regulating digital currency, the central bank can put a check on their malpractices.
o Addressing Volatility:
As the cryptocurrencies are not pegged to any asset or currency, its value is solely determined by speculation (demand and supply).
Due to this, there has been huge volatility in the value of cryptocurrencies like bitcoin.
As CBDCs will be pegged to any assets (like gold or fiat currency) and hence will not witness the volatility being seen in cryptocurrencies.
o Digital Currency Proxy War:
India runs the risk of being caught up in the whirlwind of a proxy digital currency war as the US and China battle it out to gain supremacy across other markets by introducing new-age financial products.
Today, a sovereign Digital Rupee isn’t just a matter of financial innovation but a need to push back against the inevitable proxy war which threatens our national and financial security.
o Reducing Dependency on Dollar:
Digital Rupee provides an opportunity for India to establish the dominance of Digital Rupee as a superior currency for trade with its strategic partners, thereby reducing dependency on the dollar.
o Advent of Private Currency:
If these private currencies gain recognition, national currencies with limited convertibility are likely to come under some kind of threat.
o It would reduce the cost of currency management while enabling real-time payments without any inter-bank settlement.
o India’s fairly high currency-to-GDP ratio holds out another benefit of Central Bank Digital Currency (CBDC) – to the extent large cash usage can be replaced by (CBDC), the cost of printing, transporting and storing paper currency can be substantially reduced.
o It will also minimize the damage to the public from the usage of private virtual currencies.
SC GARG COMMITTEE RECOMMENDATIONS (2019):
- Ban anybody who mines, hold, transact or deal with cryptocurrencies in any form.
- It recommend a jail term of one to 10 years for exchange or trading in digital currency.
- It proposed a monetary penalty of up to three times the loss caused to the exchequer or gains made by the cryptocurrency user whichever is higher.
- However, the panel said that the government should keep an open mind on the potential issuance of cryptocurrencies by the Reserve Bank of India.
CHALLENGES IN ROLLING OUT NATIONAL DIGITAL CURRENCY :
- Potential cybersecurity threat.
- Lack of digital literacy of population.
- Introduction of digital currency also creates various associated challenges in regulation, tracking investment and purchase, taxing individuals, etc.
- Threat to Privacy: The digital currency must collect certain basic information of an individual so that the person can prove that he’s the holder of that digital currency.
RECENT DEVELOPMENTS :
o EL Salvador, a small coastal country in Central America, has become the first in the world to adopt Bitcoin, as legal tender.
o Britain is also exploring the possibility of creating a Central Bank Digital Currency (Britcoin).
o In 2020, China started testing its official currency which is unofficially called “Digital Currency Electronic Payment, DC/EP”.
o In April 2018, RBI banned banks and other regulated entities from supporting crypto transactions after digital currencies were used for frauds. In March 2020, the SC struck down the ban as unconstitutional.
- While official digital currencies can borrow the underlying technology feature of private cryptocurrencies, they significantly differ from the latter in their philosophy and goals.
o Also to be considered are possible impacts of the introduction of an official digital currency on people, the monetary policy, and the banking system.
- There are risks to be considered as well, not the least of which will be those emerging from cyberattacks. What is more, many laws need to be amended to make the digital rupee a reality.
o So, while India might have done exceedingly well in digital payments in recent years — the Deputy Governor said they have grown at a compounded annual growth rate of 55% over the last five years — the digital rupee will be something else altogether.
Cryptocurrency and Regulation of Official Digital Currency Bill, 2021:
- The purpose of the law has been described as:
o to create a facilitative framework for an official digital currency issued by the RBI.
o to “prohibit all private cryptocurrencies in India”.
- The Bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.
What are Cryptocurrencies?
- Digital currencies in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.
- Examples: Bitcoin, Ethereum etc.
WAY FORWARD :
- India needs to move forward on introducing an official digital currency.
- There are crucial decisions to be made about the design of the currency with regards to how it will be issued, the degree of anonymity it will have, the kind of technology that is to be used, and so on. It is possible that the question of the degree of anonymity, especially, will be quite a challenging one.
- The creation of a Digital Rupee will provide an opportunity for India to empower its citizens and enable them to use it freely in our ever-expanding digital economy and break free from an outdated banking system.
- Looking into its impact on macroeconomy and liquidity, banking systems and money markets, it is imperative of policymakers to thoroughly consider the prospects of Digital Rupee in India.
India is currently on the cusp of the next phase of digital revolution and has the potential to channel its human capital, expertise and resources into this revolution, and emerge as one of the winners of this wave.