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There is debate whether there is a need for increasing the investment in research and development (R&D) to increase productivity and support climate resilience in India’s agriculture sector by diverting money from food subsidies.
There is debate about increasing R&D in the agriculture sector by diverting capital from food subsidies which will result in increased crop productivity, boost development of climate-resilient crop varieties, and ensure food security.
The act is the flagship food security law of India which aims to ensure all individuals have access to sufficient food for an active and healthy life to ensure availability, access, utilisation, and stability of food.
It was enacted on July 5, 2013, marking a shift from a welfare model to a rights-based framework.
It entitles up to 75% of rural and 50% of urban populations under Antyodaya Anna Yojana (AAY) and to subsidised food grains
Approximately 80 crore people are covered under the Act which facilitates access to highly subsidised food grains.
Life-Cycle Approach: The Act includes special provisions for pregnant women, lactating mothers, and children aged 6 months to 14 years to ensure access to nutritious meals through Integrated Child Development Services (ICDS) and Mid-Day Meal (MDM) schemes across India.
Cash Benefits: Pregnant women and lactating mothers also receive cash maternity benefits to offset wage loss during their pregnancy period and supplement nutrition.
The food grains are available at subsidised prices of Rs. 3 for rice, Rs. 2 for wheat, and Rs. 1 for coarse grains for an initial period of three years, with extensions based on Central Government decisions.
The priority households, with AAY households entitled to 35 kg of food grains per month, while priority households receive 5 kg per person.
Reducing food subsidies could free up capital and resources for R&D investment in India.
As per The Department of Agricultural Research and Education/Indian Council of Agricultural Research (ICAR), In 2022-23, India spent only 19.65 thousand crore rupees on agriculture research, which constitutes less than 0.1 per cent of India’s budget.
The food subsidy bill benefits consumers rather than farmers which constitutes the majority of the poverty-stricken people in India and more than 51% of India’s workforce.
Expanding PDS under the National Food Security Act (NFSA) has led to an inflated subsidy bill.
In the 2024-2025 budget, 96% of the Department of Food and Public Distribution's allocation is for the National Food Security Act (NFSA) food subsidy.
The subsidy bill reached Rs 758,165 crore which is 3.8 percent of GDP in 2020-21.
India does not have a rigorous management structure for food security. Issues such as corruption, leakage, and errors in exclusion result in failure to reach the food to intended beneficiaries.
For instance, during a pandemic, migrant workers found it difficult to access food rations due to documentation requirements.
PDS primarily supplies cereals but lacks essential nutrients, which contributes to malnutrition, especially among children and women.
Since soil is essential to around 95% of global food production and healthy soil is a crucial component of food production. However excessive food subsidy remotes excess use of fertilisers to impact soil health.
Because of a minimum support price, farmers have shifted their acreage from growing coarse grains to growing wheat and rice.
Additionally, as per the ICAR, a staggering Rs. 50,000 crore is wasted every year as a result of both poor accounting and insufficient storage facilities.
About 60% of India's net sown land is irrigated by the monsoon, which also provides about 70% of the country's yearly rainfall. India's agricultural output is already declining due to shifting precipitation patterns and an increase in the frequency and severity of extreme weather events like heat waves and floods. Food subsidy will further exaggerate the problem by promoting unsustainable agriculture.
Critics argue that abolition of food subsidies is necessary for diverting funds to research and development in India due to various reasons.
India's population is expected to surpass China’s by 2027, this will create economic and food security pressures in future.
The Second Green Revolution by investing in R&D will boost agricultural productivity and efficiency.
R&D investment can also increase seed variety and crop productivity.
R&D can be done in biotechnology as biotechnology reduces crop vulnerability to environmental impacts and limits chemical fertiliser dependency.
Advances in bio-formulations through R&D can effectively combat soil-borne pathogens and maintain ecosystem productivity.
R&D is essential for eco-friendly agricultural practices and farmer education on sustainable land use.
R&D can address supply-side issues, which will provide long-term solutions for Indian agriculture.
Improved access to research helps farmers address the issue of seed quality, pest control, crop sustainability, climate adaptation, irrigation, and soil erosion.
To double farm incomes, increased government and private R&D investment is important.
Water is vital for agriculture, but unpredictable monsoons and rising food demand calls for the need for smart irrigation.
Region-specific R&D in irrigation technologies can enhance water use efficiency in India.
However, abolition of the food subsidies or cutting the budget for subsidies might negatively impact the Indian people who are covered under the scheme.
The food subsidy primarily supports food security in low-income households and acts as an income transfer for low-income families. This as per the Agriculture Ministry leads to savings of about Rs. 700-800 monthly for a family of four.
The National Food Security Act (NFSA) expanded PDS coverage to include up to 75% of the rural population and 50% of the urban population. This means that the NFSA covers about two-thirds of the population of India. This addresses the prior exclusion errors in the selection process.
Food subsidies also support poor households in reallocation of the funds for other essential foods, which in turn contributes to better health outcomes.
The NFSA expanded PDS coverage but reduced per-beneficiary grain supply, which in turn balanced the overall subsidy costs.
Food subsidies remain a crucial welfare measure in the crisis situation in India and it was proven valuable during crises like COVID-19.
It is estimated that for every rupee invested in agricultural research inclusive of education, there would be a payoff of 13.85 rupees. (Indian Council of Agricultural Research)
Instead of reducing food subsidies, other expenditure areas could be optimised which can be production-linked incentives (PLIs) or rationalisation of minimum support price.
Current subsidies on electricity, fertilisers, and water lead to resource inefficiency and negative environmental effects such as food wastage and declining groundwater table.
These subsidies impact soil fertility and groundwater levels, and in turn, hinder crop diversification.
Shifting focus from input subsidies to R&D could improve resource use and agricultural productivity in the long run.
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PRACTICE QUESTION Q.Food subsidy in India is necessary for food security in India, however, it costs a significant burden on the exchequer. In this context analyse the debates on abolition of food subsidy in India.(250 words) |
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