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'We are moving in the wrong direction'

Per Pinstrup-Anderson, director-general of the International Food Policy Research Institute was in Delhi recently to attend a conference on food security in South Asia. He spoke to Business Standard about the problems and the likely solutions.

What is the position on food insecurity in the world?

We are moving in the wrong direction. There are more food-insecure people in the world today than 10 years ago. According to the latest report from the Food and Agriculture Organisation of the US, 303 million people in South Asia are food insecure, that is, they lack sustainable access to sufficient food to lead healthy and productive lives. This is an increase from 1991, when the number was 288 million.

Barring China, which has made significant progress in this area, the number has gone up in all other parts of the world.

However, we have made projections that show that by 2020, the number of food insecure in the rest of the world will fall significantly.

The fall will be the result of economic reforms and of negotiations in the World Trade Organisation, which will open up markets for food insecure people. But this is not a foregone conclusion. It will depend on the nature of policy changes undertaken.

Developing countries are unable to export their agricultural products to the developed markets due to various tariff and non-tariff barriers. So, how will trade liberalisation help improve the position with respect to food security?

Trade liberalisation leads to better resource utilisation because the new relative prices lead to production in areas where it is most efficient.

There is, however, a need to make globalisation work for poor people. In this context, there is a need to liberalise markets in Europe, North America and Japan so that developing countries can access them.

The developed world should also avoid subsidising exports. Developing countries should push for the decrease and elimination of quantity-linked subsidies in Europe, North America and Japan.

Such subsidies lead to production of surpluses and, therefore, closed markets and grant of export subsidies. These countries should, in fact, move towards direct payments.

India should push for this, if it manages to strengthen its position among developing countries, along with support from European countries like Sweden, Denmark, the UK and Germany. Even China is likely to support this position, so India could try to coopt the Chinese into negotiating for this.

There is a need to start lobbying for this. The US Congress is also finalising a farm Bill with a large number of subsidies for farmers. Quite a large proportion of these would also be quantity-related. This is also a cause for concern.

What kind of reform measures at the domestic level will help in improving food security?

Food insecurity persists not because of lack of food, but because food insecure people are too poor to afford the food that is available. They also lack access to resources to produce the food for themselves.

Governments need to invest in human resources, improve access to productive resources and employment and make policies for pro-poor technological change.

In India, also, reforms like opening up of market for agricultural products have made a difference. Here too, where markets have not been opened, like in the case of oilseeds, problems persist.

Also, the government should look at crop diversification. The agricultural policies framed by the government were based on the need to increase production of cereals. Now that the region is self-sufficient in rice and wheat, Indian agriculturists should diversify into additional high-value crops. The government policies should also be changed to reflect this.

The domestic and foreign market for alternative crops like fruits, vegetables and poultry is expanding rapidly. Input subsides are also high, resulting in distorted use of these inputs.

For instance, in India, low power tariffs for agriculture have resulted in over-pumping of underground water, which has lowered the water table in large parts of the country.

Institutional changes are needed to improve efficiencies of resource use. The resultant savings on subsidies should be invested in agricultural research and rural infrastructure, both of which will lead to further increases in productivity.

In case of research, should the focus not be on increased investment in research by the private sector?

Public investment in agricultural research is critical to ensure food security.

The private sector cannot produce solutions for small farmers. They need technology which is a 'public good' and can be used by all. The private sector can do more, but no private sector company will produce public goods from which they cannot make money.

Currently, India invests about 0.5 per cent of the value of agricultural output in public research in agriculture. This should at least be brought up to 1 per cent. Studies have shown that the social payoffs of public investment in research are in excess of 20 per cent per annum.

India needs to put money into development of drought resistant, insect resistant, disease resistant and cold tolerant varieties of crops. Crops with increased nutrient content also need to be developed.

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