Babu, Suresh Chandra

Debnath, Deepayan

Ghosh, Parijat

Helmer, Michael

Policy making in food security is at a crossroads in India, particularly for the rice crop. Whereas India has emerged has a leading rice exporter over the last two years, the government has also introduced a large food subsidy program called the National Food Security Act. The program requires that 33.6 million metric tons of rice per year be distributed to the marginalized rural and urban populations of the country. In this study, we analyze the long-term impact of India’s Food Security Act on its domestic rice market and the international market for rice. We specify and apply a structural demand-and-supply model to India’s rice market and link it with the world rice market, as part of a broad partial equilibrium modeling system of international agriculture commodity markets. We specifically focus on three different scenarios—subsidy as a price effect, subsidy as an inelastic income effect, and subsidy as an elastic income effect—under the broader framework of the National Food Security Act. We find that at the end of the projection period (the 2024/2025 crop year), as a result of the rice subsidy program, the consumption of rice increases significantly by 6,831 thousand metric ton (MT) in the case of the price effect while the inelastic income effect has little on production, consumption which increase by 265 thousand MT and 269 thousand MT, respectively and no impact on rice export of India.

Impact of India’s National Food Security Act on domestic and international rice markets

SJ, Balaji

Russia’s war on Ukraine shows no signs of subsidence. Its economic and societal adversities have already been felt worldwide but keep evolving, with food and energy being the most affected. Low-income, food-deficit nations importing from these two countries – many of which are in Northern Africa and Western and Central Asia – face critical challenges. The South Asian region, which has grappled with surging commodity prices and supply constraints even before the war, is likely to witness further inflation with rising food and oil prices. India is home to around 18% of the world’s population and accounts for 74% of the South Asian population. It is predicted to be the fastest-growing big economy this year. The country’s central bank (RBI) predicts that GDP will grow by 7.5% in FY 2022-23 (RBI, 2022), while many international organizations forecast growth between 6.4% and 8.2% (ADB, 2022; IMF, 2022; United Nations, 2022; World Bank, 2022). Still, in the wake of the ill effects of COVID-19, the country’s dependence on imports such as oil, fertilizers, and edible oils, and given surging domestic food and nonfood inflation in recent months, raises concerns about economic stability and possible interventions that might curtail fragility. The country consumes around 5 million barrels of crude oil daily but imports over 89% of its requirement from overseas. Crude oil prices have increased by 27% in just four months since the start of the war (February- June 2022). Edible oils have similarly increased, with palm and soybean oil prices rising by around 14% and 18%, respectively. The price of sunflower seed oil has increased by 42%, of which 86% originates from Ukraine and Russia. Fertilizer import dependency from the conflict regions is also sizeable. Russia was the 5th largest supplier of fertilizers to India in 2021-22, and Ukraine and Belarus were the 9th and 10th largest suppliers. The rise in prices of both finished fertilizers and fertilizer inputs has prompted the Government to double the fertilizer subsidy budgeted earlier this year. This policy brief investigates India's susceptibility to the war's disruptions and higher prices for commodities where import dependence is high. It then discusses potential income, food, and nutritional impacts on farmers, the poor, and the vulnerable. It also evaluates the Government’s policy measures such as subsidization, social safety nets, and trade diversification to reduce the impact of the war. Finally, it explores the market opportunities the conflict has created and the required structural reforms that would equip the country to handle such shocks in the future.

The Ukraine war and its food security implications for India

Pal, Chandrashri

Pathmanathan, Hamsha

Prolonged civil wars can have long-lasting adverse effects on food systems, leading to poverty and food insecurity. Overcoming food insecurity and land inequality is particularly difficult because of the highly politicized nature of conflict. This paper builds on the existing literature on food sovereignty to ensure sustainable livelihoods and community ownership of a resilient food system. We identify components of community food security to be strengthened in a post war reconstruction context. We study the impacts of the civil war on food and land administration systems, farmer struggles and current transitional justice process in relation to community food security in the Northern and Eastern Provinces in Sri Lanka and identify the technological, institutional, organizational, and infrastructural setbacks caused by conflict. It explores how such setbacks could be rectified and a resilient food system could be built in the postwar scenario.

Case study and lessons from northern Sri Lanka

Building resilience for food systems in postwar communities

Haggblade, Steven

Mkandawire, Elizabeth

Nankhuni, Flora

Hendriks, Sheryl L.

Micronutrient deficiencies are common across the developing world and have major effects on the health outcomes of its population. Although this is well understood, many countries find it difficult to bring about policy change in this regard. This paper uses micronutrient policies designed and implemented in Malawi as a case study to shed light on the barriers and gaps faced by developing countries for similar programs and policies. To understand the drivers of policy change, this paper uses the kaleidoscope model to trace the policy processes of three major micronutrients—iodine, vitamin A, and iron. Using a select set of policy process tools, as well as field interviews with key informants who were part of Malawi’s micronutrient policy process, the authors test a set of hypotheses on 16 variables that drive policy change in the micronutrient policy sphere. Results indicate that much of the agenda setting for micronutrient policies and programs was triggered by external events that focused on the elimination of micronutrient deficiencies as part of the global development agenda. These events include the International Conference on Nutrition, the Millennium Development Goals, and, more recently, Scaling up Nutrition. The design of micronutrient policies and program interventions in Malawi was adopted by locally mandated ministries and institutions, in collaboration with development partners who provided both financial and technical support at the design stage. The adoption of micronutrient policies and intervention programs was driven primarily by external funding, particularly through supplementation programs related to vitamin A and iron. Adoption of fortification standards for vitamin A has been going on for more than a decade due to continuous resistance from the private sector, which faces additional costs and needs greater technical expertise. The biofortification method of micronutrient interventions for iron and vitamin A is externally driven and relatively new in Malawi. Although this method is widely accepted by policy makers, no concrete strategy has been developed for its design, adoption, and implementation. Further, supplementation and fortification programs continue to face implementation challenges due to poor physical infrastructure and monitoring systems. However, the national institutional architecture required for agenda setting, design, adoption, implementation, evaluation, and review to address micronutrient deficiencies is in place in Malawi. The system needs continued support from development partners for effective functioning at all levels. The use of various tools for the policy change part of the kaleidoscope model indicate that policy change is a dynamic process; over time, changes in the nature and composition of the members of policy and institutional architecture can result in different policy outcomes. The Malawi case study demonstrates two things. First, local leadership is crucial in keeping micronutrient deficiencies on the policy-making agenda, and second, it matters where coordinating power is placed in the policy hierarchy. This paper finds that, even with policy champions, adopted policies will face implementation challenges unless they are supported with adequate resources and are systematically followed through to final execution and delivery.

Micronutrient policy process in Malawi

Balaji, S. J.

In this paper, we study the transformation process Indian agriculture exhibited in the recent past, studying its policy implications. Between the years 2005-06 and 2015-16, more than 52 million workers left agriculture, which did not have any effect on agricultural output due to productivity improvements. We estimate the contribution of productivity growth and structural change in agriculture to national productivity growth during 1981-2016. We estimate differentials in agricultural productivity and in their ability to contribute to the structural change process for 21 major states of India. Using revised employment estimates, we trace major changes during the pre-reforms (before 1991) and post-reforms periods. Results show that in the pre-reforms period, the impact of productivity improvements in agriculture on agricultural output was equated by the new workforce entering into this sector, leading to a stagnant labor productivity trend. The labor-shift from agriculture during the early years of the post-reforms period, which increased further in the next decade, has led to a consistent rise in agricultural productivity. In the absence of reforms and the associated labor shift, the productivity growth in Indian agriculture would have been much lower. A similar labor shift during the last decade has not affected agricultural output, which has risen more rapidly. This result holds true for almost all states studied. There exists a positive relation between labor-shift and agricultural output in a cluster of states. Decomposition results indicate ‘within-sector’ productivity growth is the major source of overall growth, with a rising contribution of ‘structural change’. Studying the sources of growth across states offers new scope to achieve inter-sectoral productivity convergence.

Babu, Suresh Chandra

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