USING SURPLUS FOOD STOCKS PROFITABLY
S. S. BANKESHWAR

It is sad that a well-reasoned letter dated 2nd April, 2001, addressed to our Prime Minister, Shri Atal Bihari Vajpayee, by the Delhi School of Economics (DSE) has not evoked any response from him, let alone any comments from our opposition leaders. Not a single English paper has bothered to even publish it or comment on it other than the Delhi weekly, Mainstream.

The main thrust of the letter is as follows:

  1. Half of our children are chronically undernourished and half of our adult women suffer from anaemia.
  2. This year, with drought affecting large parts of our country for the third time in succession, undernourishment and starvation will only intensify.
  3. It is shocking to see massive public resources being used, rather misused, to buy foodstocks out of reach of our people, when we have no storage capacity. The foodstock stored is thus just allowed to rot! Either this foodstock should be exported or sold to the poor at subsidized price.
  4. The Union Government spends over Rs.10,000 crores a year on so-called ‘food subsidy’, although only a very small proportion of this subsidy reaches the poor. Much of this ‘food subsidy’ is spent on procuring, handling and storing foodstocks, which is allowed to rot, as we have no storage capacity!.
  5. Foodstocks have increased by leaps and bounds in the last couple of years, well beyond the official ‘buffer stock’ of about 17 million tones. Further increases in the ‘buffer stock’, following the recent Cabinet decision to raise the ‘minimum price’ (with an eye on the farmers’ vote bank) cannot be ruled out.
  6. According to the Commission for Agricultural Costs and Prices, wheat procurement alone is likely to exceed 15 million tonnes in the coming year. Nearly half of this will rot as we have no storing capacity! There are no plans to make constructive use of these foodstocks for any income generation programmes like food-for-work schemes or for an expansion of our public distribution system.
  7. Such programmes will have no adverse effect on our budget. If surplus food stocks are used to fund income generation programmes, it would not add to the budget deficit at all, since the food stocks in question have already been bought.
  8. The food stocks that are allowed to rot is a burden on the economy, considering that there is no possibility of exporting more than a small proportion of the foodstocks; storage and handling costs are high and the Food Corporation of India is in desperate need of storage space, in anticipation of large-scale procurement operations after the rabi harvest.
  9. Far from being financially onerous, a constructive use of surplus food stocks for drought relief programmes would relieve the government of the expensive burden of storing idle stocks.
  10. The Antyodaya programme aimed at providing subsidized food to the poorest of the poor has not made any significant dent in the surplus food stocks or provided any relief to the drought affected people of our country.
  11. We should ensure that surplus food stocks are profitably utilized without further delay to fund employment generation programmes and other relief measures in the drought-affected areas. The case for immediate use of idle food stocks for income-generation purposes is worth considering seriously.
    Finally, bold intervention at the highest level is imperative to avert widespread deprivation and misery and that too amidst plenty!
My congratulations to the Delhi School of Economics. Mr. S. S. Bankeshwar is a member of the Advisory Board and a regular contributor to Freedom First.
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