in this issue - cbgaindia.org visiting fellow to several foreign universities, he has written...

CBGA Budget TRACK Vol. 8, Track 1, January 2011 1

Centre for Budget and GovernanceAccountabilityA-11, Second Floor, Niti BaghKhel Gaon Marg, New Delhi - 110 049INDIAPhone: +91-11-4174 1285 / 86 / 87Fax: +91-11-2653 7603Email: [email protected]: www.cbgaindia.org

Views expressed in the articles are those ofthe authors and not necessarily the positionof the organisation.

Volume 8, Track 1 January 2011

IN THIS ISSUE

Towards Zero HungerDevinder Sharma 2

Aiming for a Substantive Food SecurityActDipa Sinha 5

Destitution, Social Barriers and FoodRightsHarsh Mander 7

Securing Food for the PeopleJayati Ghosh 10

Food Guarantee: Issue is PoorHousehold Confidence, not Kilos andRupeesK S Gopal 12

Should Public Distribution System beTargeted?Madhura Swaminathan 14

Food Security in IndiaN.C. Saxena 17

Right To Food and National FoodSecurity ActS. Mahendra Dev 19

Food Security sans PDS:Universalisation through Targeting?Smita Gupta 21

Budget and Policy TrackingRia Sinha 24

“The right time to eat is: for a rich man when he is hungry, for a poor man when he has something to eat.”The Mexican proverb sums up the predicament of the proposed legislation on food security inthe country today. On one hand, the government means to ensure every individual in thecountry the right to food but it also intends to accomplish this through an extremely tediousprocedure that would eliminate a huge proportion of the country’s population from beingeligible for this basic entitlement. In this issue of Budget Track, we draw your attention to thisand many such concerns with regard to the proposed right to food legislation.

The problem of hunger has been a major issue confronting Indian society and India’s record isextremely unflattering when compared to some of the poorest countries in the world. To tracethe developments in the drafting of the proposed legislation, concerted efforts were initiatedwhen People’s Union for Civil Liberties (PUCL) petitioned the Supreme Court in 2001foregrounding the right to food as an essential component of right to life, which is providedunder Article 21 of the Indian Constitution. While the petition initially highlighted twospecific aspects of state negligence, i.e. the breakdown of the public distribution system (PDS),and the inadequacy of drought relief works; over time, the scope has widened.

The United Progressive Alliance (UPA) has initiated some efforts towards fulfilling its electionpromise of ensuring right to food for all; the proposed National Food Security Act seems to havemoved up in the priority list of the Union Government over the last few months. UPA’s senseof urgency for tackling the problem of hunger and food insecurity in the country has offered alot of hope. However, its perspective on how this deep rooted problem can be addressed issomething that has raised serious concerns.

While UPA’s perspective on this issue has been ambiguous, there seems to be a reasonably highchance of the ‘right’ to food getting diluted because of the contradictions within the rulingpolitical alliance. That the major policy advisory bodies, viz. the National Advisory Council(NAC) and the Prime Minister’s Economic Advisory Council, have differed significantly in theirrecommendations pertaining to the coverage of the proposed National Food Security Act revealsone such contradiction. In fact the NAC’s recommendation in this regard too has come undercriticism for diluting the demands of the civil society for universal coverage of right to food. Itneeds to be ensured that the UPA does not miss this crucial opportunity for enacting alegislation on food security that can actually help the country overcome the problem ofwidespread food deprivation and hunger.

A wide range of issues related to the right to food such as implementation of food-relatedschemes, urban destitution, the right to work, starvation deaths, and even general issues oftransparency and accountability are now part of the larger campaign towards ensuring right tofood. This issue of Budget Track has its spotlight on Right to Food where these and other relatedaspects have been addressed in considerable detail. Contributions range from the SupremeCourt-appointed Right to Food Commissioners to leading activists of the campaign andillustrious academics. These articles would, it is hoped, inform and guide our understanding andadvocacy on Right to Food and come in handy as a ready-reckoner on the issue of financial andquality aspects pertaining to the proposed legislation.

In our Budget and Policy Tracking article, we cover the major debates (or the absence of it) inParliament during the Winter Session in 2010. This apart, relevant concerns that are flagged andwhich dominated the public policy discourses are the observations made by the Comptroller andAuditor General on the recent 2G Spectrum scam, an overview of the proposed changes indirect taxes, and the opening up of policy space for civil society stakeholders with PlanningCommission inviting suggestions from people for the Approach Paper to the 12th Five Year Plan.

CBGA Team


The path to hell, they say, is paved withgood intentions. The way to feed thehungry and impoverished in India – theworld’s largest population of hungry andmalnourished – also seems to be driven bygood intentions. My only worry is that theproposed National Food Security Act willend pushing the hungry even more deeplyinto a virtual hell.

From what appears in the newspapers,however, and from what is emerging fromthe hectic parleys that the Food Ministryas well as the Planning Commission areengaged in, the path being developed isunlikely to deviate from the presentdirection to hell for the hungry. If theprimary objective of the new law is simplyto re-classify below-poverty-line (BPL)families by identifying who is entitled toreceive 25 kg (or 35 kg) of grain (wheatand rice) per month at a price of Rs 1/kgfor millets, Rs 2/kg for wheat and Rs 3/kgfor rice, then I think we have missed thevery purpose of bringing in a statutoryframework to ensure the right to food.

Let us first be clear that India finds itself inthe pit as far as hunger is concerned. In2008, the International Food PolicyResearch Institute (IFPRI) had rankedIndia 66th in Global Hunger Index for 88countries. In 2010, India had slipped to67th position among 84 countries. Hungermultiplied at a time when we had the bogusPublic Distribution System operative, mademore efficient by the addition of the prefix‘targeted’. Hunger also multiplied while theSupreme Court was seized of the issue, andhad even constituted an office of FoodCommissioner (set up in response to apetition in Supreme Court) monitoring thefood distribution supplies. Hunger andmalnutrition grew at a time when we hadmore anganwadis set up, and more schoolsbeing provided with mid-day meals.

There is something therefore terriblywrong in our approach. The Ministry forFood and Agriculture, Ministry forHuman Resource and Development,Ministry for Rural Development, Ministryfor Child & Women Development hadamong them 22 national schemes orprogrammes, and yet hunger goes onmultiplying.

At a time when the government is nowplanning to bring out a National FoodSecurity Bill, which aims at grantingdifferential legal entitlement of foodgrainsto nearly 800 million people through areformed PDS network, it is time to askwhether the proposed bill will meananything for the poor and hungry? Howcan we ensure that hunger is removed byrelying on the same bogus PDS system thathas failed to deliver in the past 40 years?Isn’t the proposed Food Security Act likeold wine in a new bottle?

Hunger needs more than PDS ration, andthat is where we are failing to focus on.Unless we remove the structural causesthat excerbate hunger, and most of theserelate to agriculture and management ofnatural resources, India would not be ableto make any significant difference inreducing hunger. Let me therefore look atsome of the commonly raised fears/questions, and see how we can make theproposed food security act meaningfuland effective.

India already has numerousprogrammes for fighting hunger, why dowe now need a National Food SecurityAct?

It is true that we have an impressive list ofprogrammes to fight hunger, and thebudget allocation for these is increasedevery year, and yet the poor go hungry.The number of hungry and impoverishedhas increased with every passing year. Indiahas more than a third of the world’shungry. Save the Children tells us thatmore than 5000 children die every day inIndia from malnourishment.

Therefore, to add another revampedscheme to the existing lot is certainly notgoing to make it any better for the hungry.Nor a mere tinkering of the approach willhelp. Replacing the ration cards for thePDS allocations with food stamps is onesuch misplaced initiative. If we persist withsuch borrowed ideas, hunger will continueto multiply.

I am a strong supporter of the right-basedapproach to fight hunger. But anotherpiece of legislation that enshrines Right toFood as the basic human right is not goingto make any difference to those who live inhunger and penury, and to the millionswho are added to this dreaded list yearafter year. Right to Food cannot beensured by simply ensuring on paper halfthe food entitlements (which has evenfailed to reach the needy) that a humanbody needs for normal human activityand growth.

Hunger is basically an outcome of ourwrong policies and our inability to acceptthat the delivery system is not delivering.At present some 22 governmentprogrammes exist to fight hunger and toprovide food and nutritional security.These programs run by various Ministriesrange from Mid-day Meal Programme toNational Food Security Mission, andAntyodaya Anna Yojna to AnnapoornaYojana.

Knowing that the existing programmesand projects have failed to make anyappreciable dent, it is high time theopportunity provided by the proposedNational Food Security Act be utilised ina realistic manner. It is a greatopportunity, and we will let down thenation if we fail to bring about a radicaloverhaul of the existing approach to fighthunger.

Why can’t we strengthen the existingPublic Distribution System (PDS) tomake it more effective?

Towards Zero Hunger*Devinder Sharma

*Devinder Sharma, an agricultural scientist by training, quit journalism to pursue research on sustainable agriculture, food security and poverty, among otherissues. A Visiting Fellow to several foreign Universities, he has written several books and is also the founder of Chakriya Vikas Foundation.


The Justice D P Wadhwa committeeappointed by the Supreme Court has veryrightly dubbed the running PDS as abogus programme. It has very clearlybrought out that the PDS has collapsed inseveral states, and is languishing in severalothers. It is a system that is engulfed incorruption, leakage and inefficiency.

Much of the food from the PDS isdiverted to the open market. PDS grainsare also diverted to neighbouringcountries like Nepal, Burma andBangladesh. As Justice Wadhwa says 80per cent of the corruption is before thegrain reaches the ration shops. There areseveral estimates about the extent ofleakage and siphoning off of the grains,but the fact remains that PDS has failedto deliver.

Having faith in a rotten PDS system, as theSupreme Court appointed advisory panelhas been asserting, is basically playing aprank with the poor and hungry. Butsomehow I find that the experts andactivists who are part of the SupremeCourt committee too are content with thesystem because it gives them enormouspolitical clout. It is primarily for thisreason that there is hardly muchdifference in the approach that thegovernment is planning, and a section ofthe civil society is suggesting.

But at the same time, there is a need for adistribution system. I am asking for acomplete overhaul of the existing PDS. Amere tinkering will not do. Replace it witha more sharp and effective channel. At thesame time, there is a need to limit thescope and reach of the distributionchannel in the rural areas where a morepeople-oriented programme can belaunched to ensure long-term foodsecurity.

Group of Ministers have now directedPlanning Commission to redefine thenumber of actual poor. Will it not helpin ensuring food reaches those who needit most?

First and foremost, the time has come todraw a realistic poverty line. The

Tendulkar Committee has suggested that37 per cent of our population is living inpoverty. Earlier, Arjun SenguptaCommittee had said that 77 per cent ofthe population (or 836 million people) isable to spend not more than Rs 20/day.Justice Wadhwa Committee has nowrecommended that anyone earning lessthan Rs 100 a day should be consideredbelow the poverty line.

Knowing that India has one of the moststringent poverty line in the world, thefault begins by accepting the faultyprojections. During Prime MinisterNarasimha Rao’s tenure, PlanningCommission had even lowered the povertyestimates from 37 per cent to 19 per cent.Poverty estimates were restored back whenthe new Planning Commission took over.If we had persisted with the same povertyline of 19 per cent (in the beginning of1990s), India would have banished hungerin official records by now.

But the tragedy is that none of thecommittees, economic surveys havehighlighted the urgent need to change thepoverty line to a more meaningful figure ifthe issue of growing hunger has to benipped in the bud. Surprisingly, deputychairman of the Planning Commission,Montek Singh Ahluwalia is now sayingthat he finds the Tendular committeerecommendation of 37 per cent as theBPL line “reasonable”.

Extent of hunger does not depend uponwhat policy makers think as ‘reasonable’.It has to be realistic. It doesn’t help incontinuing with faulty estimates. Itherefore suggest that India should havetwo lines demarcating the percentage ofabsolute hungry and malnourished fromthose who are not so hungry. The SureshTendulkar Committee suggestion of 37 percent should be taken as the new Hungerline, which needs low-cost food grains asan emergency entitlement. In addition, theArjun Sengupta committee’s cut-off at 77per cent should be the new Poverty line.

Once we have set these criteria, theapproach for tackling absolute hungerand poverty would be different.

If India is to feed every poor, where isthe money?It is often argued that the governmentcannot foot the bill for feeding each andevery Indian. This is far from true.Estimates have shown that the countrywould require 60 million tonnes offoodgrains (@35 kg per family) if it followsa Universal Public Distribution System. Inother words, Rs. 1.10 lakh crore isrequired to feed the nation for a year.

If the government could provideapproximately Rs. 3.5 lakh crore aseconomic stimulus to the industry, andalso provide for Rs. 5 lakh crore asrevenue foregone in the 2010-11 fiscalyear, which are the sops and taxconcessions to the industry and business,how can the government say it has nomoney to fight hunger?

How can a country, which fares muchworse than sub-Saharan Africa when itcomes to hunger and malnutrition, try tosave money instead of fighting hunger.

The latest National Advisory Council(NAC) recommendations show, after theimplementation of the final phase, thatthe additional cost would be Rs 23,231crore. At present the government providesRs 56,700 crore every year by way of foodsubsidy.

What policy changes are required toensure food security for all times to come?But all this is not possible, unless someother policy changes are introduced to putthe emphasis on long-term sustainablefarming, and to stop land acquisitions andprivatisation of natural resources. Weneed policies that ensure food for all forall times to come. This is what constitutesinclusive growth. A hungry population is agreat economic loss resulting from theinability of the manpower to undertakeeconomic activities. The debate on theproposed National Food Security Billprovides us an excellent opportunity torecast the economic map of India in sucha way that makes hunger history.

I suggest a 5-point programme to ensureZero Hunger:

Towards Zero Hunger


● Revive agriculture on the lines ofsustainability by restoring soil healthand the natural resource base bybringing in low-external inputsustainable farming practices.

● Provide farmers with a fixed monthlyincome, incorporating the minimumsupport price. For the poorest of thepoor household receiving micro-finance, ensure that the interest rate isreduced from the existing 18-48 percent to a maximum of 4 per cent.

● Set up Community Foodgrain Banksat the village level on the lines of thetraditional gola system of foodsecurity in Bihar and east India.

● Export of foodgrains be allowed onlywhen the country’s total populationis adequately fed.

● International trade, including FreeTrade Agreements, should not beallowed to play havoc with domesticagriculture and food security.

Isn’t it sad that people living in thevillages which produce food should go tobed hungry?

Exactly, this is where we need afundamental shift in our approach to

addressing hunger. This will also reduceour dependence upon PDS, and therebyreduce the food subsidy bill. After all,India has more than 6 lakh villages. Whycan’t we ensure that at least 4 lakh of thesevillages become food self-sustaining?

The proposed Food Security Act shouldconsider setting up of communitycontrolled small foodgrain banks at thevillage and taluka level. Any long-term foodsecurity plan cannot remain sustainableunless the poor and hungry becomepartners in the fight against hunger. Thereare ample examples of successful models oftraditional grain banks (for instance, thefamed gola system in Bihar), which need tobe replicated through a nationwideprogramme involving self-help groups andNGOs.

Drawing up programme and projects thathave long-term sustainability and becomeviable without government support in acouple of years, involving charitableinstitutions, religious bodies, SHGs andthe non-profit organizations to ensurespeedy implementation.

I am aware of at least a hundred villages inthis country which haven’t witnessedhunger for over four decades now. Theyfollow the traditional ‘sharing and caring’

system. I think this programme needs to beextended to all the villages of the country.Let the people in the villages take controlover their food security.

Already, 20,148 foodgrain banks in 20states have been set up. There is an urgentneed to extend the reach to at least 4 lakhvillages which produce foodgrains therebyensuring that the villages become self-reliant in food security.

Like in Brazil, the time has come whenIndia needs to formulate a Zero Hungerprogramme. This should aim at adifferential approach. I see no reason whypeople should go hungry in the villages,which produce enough food for thecountry year after year. These villages haveto be made hunger-free by adopting acommunity-based localised food grainbank scheme.

In the urban centres and the food deficitareas, a universal public distributionsystem is required. The existing PDS systemalso requires overhauling. Also, there is adire need to involve social and religiousorganisations in food distribution. Theyhave done a remarkable job in cities likeBangalore, and there are lessons to beimbibed.

Towards Zero Hunger


Budget and Policy Tracking

There was much excitement when foodsecurity became one of the issues in themanifestos of most major political partiesin the run-up to the 2009 GeneralElection. With burgeoning food stocks,double-digit food inflation, stagnantmalnutrition rates, declining calorieconsumption and high levels of anaemia,radical interventions are required to helpthe situation of hunger and poverty in thecountry. The promise of a Food SecurityBill by the ruling alliance provided anopportunity to introduce and expandessential programmes towards ensuringfood security for all. However, in themonths that followed what we have seen isonly short-sighted proposals that refuse toaddress the core issues. Until now therehave been proposals from the Ministry andthe Empowered Group of Ministers(EGoM) as well as the National AdvisoryCouncil (NAC).

A Universal PDS

The draft of the EGoM was veryminimalistic with its focus only on theTargeted Public Distribution System(TPDS). The debates in the media havealso largely been restricted to discussionsaround the PDS. Even with regard to thePDS, it is seen that the government isrestricted to thinking within the frameworkof dividing the population into APL andBPL. The initial draft of the governmentguaranteed no entitlements for thoseabove the poverty line (APL). This wascompletely unacceptable as data has shownthat there are large-scale exclusion errorsin the targeted system with the deservingpoor being left out of the PDS net. Whilethis is a problem of identification, it is alsoa result of artificial “caps” set on the basisof the Planning Commission’s povertyestimates. It has been widely argued thatthe current poverty line is more of adestitution line and does not appropriatelyreflect the extent of poverty in the country.

Alternate estimates ranging from 37percent (Tendulkar committee) to 77percent (NCEUS report’s estimate ofnumber of persons living below an MPCEof Rs.20 per day) have been provided.The Tendulkar committeerecommendations have also been acceptedand foodgrain allocations will now bebased on these estimates.

However, this does not yet resolve all theproblems with targeting. Identification ofthe poor still remains a problem. So doesthe vulnerability of the huge proportionof people who are living at the margins,just above the poverty line. In the Indiancontext of very low incomes, widespreadpoverty and food insecurity,universalisation is required for the PDScan make a dent on people’s lives. Eventhe NAC in its initial recommendationsstated that “time-bound universalisationof foodgrain entitlements across thecountry may be desirable...” However,even the NAC in its finalrecommendations moves away from thisvision, while proposing to divide thepopulation into three groups – “priority”(based on Tendulkar committee’sestimates); “general” and the “excluded”(top 10 percent in rural areas and top 50percent in urban areas).

The NAC recommendations are indeed astep ahead of what exists today and whathas been previously proposed for the Billby the Food Ministry and the EGoM.Firstly, the coverage of those in thepriority group is larger than the current“BPL” allocations of the Government ofIndia. Based on Tendulkar estimates (plusaccounting for 10 percent transient poor),the NAC proposes to include 46 percentof rural population and 28 percent ofurban population to get an entitlement of35 kg (7 kg per head) per month at Rs.3per kg for rice, Rs.2 per kg for wheat andRs.1 per kg for millets. This would result

in about 9.8 crore households beingincluded under this category. Further, theprices which are being proposed are lowerthan the current prices for the belowpoverty line category. Finally, those in thegeneral category are guaranteed 20 kg permonth as an entitlement at prices whichare not more than 50 percent of theminimum support price (which is close tocurrent APL prices). At present, there isno guarantee for APL families, with whatthey get being different in different states.The recent government policy of curtailingAPL allocations based on previous off-takes (in spite of rising prices) has resultedin APL households getting almost nothingin many states.

However, the NAC recommendations arestill disappointing because while they domove one step forward, they have missedthe opportunity of providing a radicalvision for the food security programmes inthe country. The central problem ofidentification of poor householdsremains. In fact, it is not clear what theformulation in the Bill will be – what willhappen when the Planning Commissionrevises poverty figures periodically, basedon new National Sample Survey (NSS)data – will the priority group also shrinkaccordingly? An Act is surely not requiredto just expand coverage to a largerpopulation without questioning the verybasis of such targeting. Having a targetedPDS in legislation will make it even moredifficult to fight the division of thepopulation into categories of those belowthe poverty line and those above (eventhough the groups have been calledgeneral and priority, the idea essentiallyremains the same).

From newspaper reports it seems as if theNAC’s primary concerns were ofunavailability of foodgrains and resourcesrequired for a universal PDS. A roughestimate of the quantum of foodgrains

Aiming for a Substantive Food Security ActDipa Sinha*

*Dipa Sinha is a research scholar at Jawaharlal Nehru University, New Delhi, having previously worked with the Supreme Court commissioners’ office inthe RTF case. A well known child rights activist, she has been associated with the M Venkatarangaiya Foundation (MVF) and written articles on children’sright to food in several newspapers.




required (assuming 80 percent off-take)shows that about 80 million tonnes areneeded for universalisation of the PDS.The current procurement by FCI is about60 million tonnes, and procurement hasbeen increasing over the years. What iscurrently procured is only about 30percent of production. Further, there isno reason to assume that agricultureproduction will remain stagnant. This isprecisely the reason why the Right to Foodcampaign has been arguing that whilediscussing the food security bill, issuesrelated to production, procurement anddistribution must be simultaneously dealtwith. The food security bill can in fact beseen as an opportunity for the much-needed reforms and investment inagriculture to take off1.

As far as budgetary requirements areconcerned, the various estimates show thatit would cost about Rs.1.2 lakh crore for auniversal PDS. Again, while this is indeed alarge amount, it is something the countrycan afford to invest considering that eachyear about Rs.5 lakh crore are given awayas tax exemptions, mainly benefitingcorporations. Further, with other reformsin the PDS such as decentralisedprocurement and storage, the economiccost of foodgrains can also be expected tofall, resulting in lower subsidies. It wouldbe better to work around food andresource constraints by not compromisingon the principle of universalisation but byphasing the process over a few years.

Further, while universalisation of PDSwould be the core, what is required is acomprehensive food security bill whichalso guarantees entitlements for vulnerablegroups such as children, women, the agedand disabled.

Child Malnutrition Cannot beNeglected

It is well accepted that interventions toaddress malnutrition must lay special

focus on children, especially childrenunder two years of age. Much of themalnutrition that sets in during earlychildhood is irreversible. It is shamefulthat India has one of the highest rates ofchild undernutrition in the world. In factit is high levels of child malnutrition thatputs India at the bottom of the list inmeasures like the Global Hunger Index2.Although we have one of the largest childdevelopment programmes in the world, inthe form of the Integrated ChildDevelopment Services (ICDS), this hasbeen able to make very little impact onmalnutrition rates. ICDS from itsinception has been an under-funded andignored programme although its objectiveswere highly commendable. With ICDS asthe base, higher investments and reformsin design can contribute significantly toimproving nutrition status of children inthe country.

Reducing child malnutrition requires arange of services including maternityentitlements, crèches, breastfeedingsupport, supplementary nutrition andcounselling towards appropriate infantand young child feeding practices. Thiswould at the very least requireuniversalisation with quality of the ICDS,introduction of universal andunconditional maternity entitlements anddiverse and flexible models of child carebased on the need of working mothers3.Given the widespread nature ofmalnutrition in the country, it isimperative that all these programmes aredesigned for universal coverage. It has beenestimated that all of this put togetherwould cost about Rs.50,000 crore peryear or about 0.8 percent of GDP4.

With such unacceptably high levels ofchild malnutrition there need be nofurther explanations to justify suchexpenditure. However, for those who arestill sceptical, there are also compellingeconomic reasons to invest whatever is

required for eradicating malnutrition.Reducing child malnutrition not onlycontributes to higher productivity andtherefore economic growth in the futurethrough healthier populations but alsoleads to savings of health care costs thatarise from malnutrition and future healthbenefits. While it is difficult to put anumber to the benefits of appropriatechild growth and development, someestimates indicate that the losses to GDPfrom various components ofundernutrition can be as high as 3 percentof national income5.

While the initial drafts of the governmentdid not mention child malnutrition at all,the NAC’s note does specify that maternaland child nutrition entitlements will beincluded in the Food Security Bill.However, it is not clear whether these willbe in their current form or whether thecomprehensive interventions required willbe brought in. It would be quite a pity ifthis opportunity is wasted by introducingpiece-meal and stingy programmes.

Towards Food Security for All

It is time that sustained efforts were madeto ensure food security for all. The foodsecurity bill provides a historicopportunity to initiate this process. Thismust not be lost by a narrow vision;instead we must put in place acomprehensive law that ensures that everyresident of this country is well nourished.For this, the least that is required is auniversal PDS, adequate child andmaternal entitlements and specialprogrammes for the vulnerable such as thehomeless, aged, single women, disabled etc.along with efforts towards revitalisingagriculture and protecting small andmarginal farmers. While it seems like weare moving further and further away fromsuch a vision, civil society and the mediamust continue to put pressure on thegovernment to ensure that not all is lost.

1 See draft bill of right to food campaign at www.righttofoodindia.org.2 The GHI report is available at http://www.ifpri.org/publication/2010-global-hunger-index and India’s in the GHI 2010 is in the ‘alarming’ category ranking 67 out of 84 countries.3 For further details see the FOCUS report (2006) available at www.righttofoodindia.org and Working Group for Children Under Six (2007), Strategies for Children under Six in the 11thplan, Economic and Political Weekly.4 35,000 for ICDS including second worker, better SNP, infrastructure, anganwadi-cum-crèches etc. and 12,000 for maternity entitlements.5 For e.g. see Lawrence Haddad, “Nutrition and Poverty” In Nutrition: A Foundation for Development, Geneva: ACC/SCN, 2002 and references in Veena S Rao, “Economics of Malnutrition:Combating malnutrition in the Inter-generational Context”, available at www.britannia.co.in/bnf/media/veena-rao.ppt accessed in Nov 2010.

Aiming for a Substantive Food Security Act


In the dark shadows of this land, the silenttragedy plays out of millions of womenand men, boys and girls who sleep hungry.The experience of chronic hunger indistant villages of India, as much as on itscity streets, is one of intense avoidablesuffering; of self-denial; of learning to livewith far less than the body needs; of mindsand bodies stymied in their growth; of theagony of helplessly watching one’s lovedone’s - most heartbreakingly children - inhopeless torment; of unpaid, arduousdevalued work; of shame, humiliation andbondage; of the defeat and the triumph ofthe human spirit.

Such high levels of hunger andmalnutrition are a paradox because theystubbornly survive surging economicgrowth, and agricultural production,which outpaces the growth of population(although it has worryingly stagnated inrecent years). The riddle deepens becausethe State in India runs some of the largestand most ambitious food schemes in theworld. The persistence of widespreadhunger is the cumulative outcome ofpublic policies that produce andreproduce impoverishment; of failures toinvest in agriculture especially in poorerregions of India and for rain-fed and smallfarmers; of unacknowledged andunaddressed destitution; of embeddedgender, caste, tribe, disability and stigmawhich construct tall social barriers toaccessing food; but in the last analysis, it isthe result of a profound collapse ofgovernance.

The colonial Famine Codes continue tocast a shadow over official responses tohunger, even though both the nature offamine and the political economy havebeen completely transformed in free India.They continue to regard starvation as atemporary aberration caused by rainfall

Destitution, Social Barriers and Food RightsHarsh Mander*

failures rather than an element of dailylives. The effort remains to craftminimalist responses, and to spend as littlemoney as is absolutely necessary to keeppeople threatened with food shortagesalive. And the duties of officials are notlegally binding, in ways that they cannot bepunished for letting citizens live with anddie of hunger.

Allegations of starvation deaths aretypically met by official denials and theblaming of the victims. Public servantsbelieve mistakenly that death fromconsuming no food whatsoever is the only‘proof’ of starvation. But starvation is acondition of not just the dead but theliving, and people who have lived withprolonged food denials mostly succumbnot directly to starvation, but to healthconditions which they would have easilysurvived had they been adequatelynourished. There are seamless linesbetween dying of and living withstarvation, prolonged food denials,malnutrition, and the subjectiveexperience of hunger. Starvation is closelyrelated to the equally neglectedphenomenon of destitution, in whichpeople lack even the minimal economicmeans for survival. The State mustacknowledge these conditions, identifypeople threatened by them, and addressand prevent the enormous and avoidabletoll of suffering, sickness and death thatthey entail.

The State in India implements massivefood, livelihood and social securityprogrammes – some of the largest in theworld – which theoretically supportvulnerable people from even before theirbirth to their survivors after death.Expectant mothers are fed in ICDScentres, along with infants, children up tothe age of six and adolescent girls. The

child in school gets school meals. Asadults, women receive maternity support,bread earners are guaranteed 100 days ofwage employment in public works; and ifidentified to be poor, they can buysubsidised cereals from a massive networkof half a million ration shops. The aged -and in many states widows and disabledpeople - are given pensions. And if anearning adult dies prematurely, thesurvivor is entitled to insurance.

These programmes are plagued bycorruption, leakages, errors in selection,delays, poor allocations and littleaccountability. They also tend todiscriminate against and exclude thosewho most need them, by social barriers ofgender, age, caste, ethnicity, faith anddisability; and State hostility to urbanpoor migrants, street and slum residents,and unorganised workers.

Public policy, and much of civic actionand mainstream academia, do notadequately acknowledge or address thereality of the uncertain existence of thosewho grapple with hunger, food denialsand starvation as a part of their everydaylives. If their suffering is admitted, theytend to be blamed for it, as the‘undeserving’ poor.

This links closely with the neglected,invisible malaise of destitution. Destitutepeople are those who almost completelylack resources (financial and material),employment, assets, access to credit, andsocial and family support and networksrequired to secure the means for dignifiedsurvival. These are people who arepowerless and disenfranchised, sociallyisolated and devalued, sometimesstigmatised and even illegalised, and oftenwith special needs born out of disability,illness, social standing and age.

*Harsh Mander is a social activist and writer who is currently theDirector of Centre for Equity Studies and a member of the UPA government’s NationalAdvisory Council. He is also one of the Supreme Court-appointed Special Commissioners on Right to Food. A bureaucrat who quit the IndianAdministrative Services after the 2002 Gujarat riots, he heads the Aman Biradari campaign for promotion of secularism and communal harmony.


For large numbers of these forgottenpeople who live routinely and precariouslyon the edge of survival, each day comeswith the danger of one push that willhurtle them down the precipice. This maycome from an external emergency like anatural disaster, epidemic or riot, or evenfrom local crises: a sickness in the family, asudden untimely death of a bread earner,or a brush with the law. These people wholive in constant peril of slipping intostarvation – or at least chronicunaddressed hunger – may be described asdestitute.

Karl Marx wrote of the exclusion ofdestitute populations from what hedescribed as political economy: “Politicaleconomy does not recognise theunoccupied worker…The beggar, theunemployed, the starving [and] thedestitute are figures which exist not for it,but only for the eyes of doctors, judges,gravediggers and beadles.Nebulous…figures which do not belongwithin the province of politicaleconomy”1Marx was right about theirexclusion, but not about their being“unoccupied workers”. On the contrary,we have found that the destitute areforced to labour in arduous, low paid,undignified work even to stay barely alive.

In a perceptive paper, Barbara HarrissWhite tries to unravel the features andsources of destitution. Firstly, it involvesthe absence of any control over assets andthe loss of access to income from one’sown labour. This loss of control mayresult from mishaps, addictions, disasters,health emergencies, and collapse orwithdrawal of family support. “A plausiblesequence involves the progressiveliquidation of small stock, livestock,consumer goods and eventually the failureto protect from sale the key productiveassets…The right to the asset of one’s ownlabour (may be) forfeited. This right maybe sold to others. The concept ofdependence may be transformed and thelabour of non-labouring dependents soldor bonded. The most extreme tactics donot involve the sale of labour so much asthe marketing of the body itself (as in thesale of blood or of organs or the rentingof the body as in sex work)”.2

The destitution and helplessness of very-marginalised groups do not arisefrequently from low incomes or even fromtheir own intrinsic and irrevocablebiological infirmities (such as of age anddisability), but by the fact that in manycases these infirmities are externallyimposed, by social arrangementsthemselves. There are some echoes of thisidea in some of the recent literature onsocial exclusion. Whereas concepts such aspoverty, vulnerability, deprivation andinequality do not impute causality, a socialexclusion framework implies not only thata person or persons are being excludedbut that someone or something “is doingthe excluding”3. The word exclusionsuggests that there is a core and aperiphery, and that ‘excluded’ people arethose who are actively blocked access tothe core. The importance of theseperspectives is that poverty is not perceivedto be a mere attribute of certain categoriesof people. Instead, it is seen as somethingthat is actively done to people. It is notwhat they are, but what they have beenmade. It is interesting that the ex-untouchables of India have discarded theappellation given to them by Gandhi –harijan, meaning children of God – whichthey regard as patronising. They preferdalit – which means one who is crushed –because the term implies that they havebeen oppressed, and it has thereforeacquired a cultural context of assertionand anger. In this sense, the term exclusionis useful.

So also is the word social. The mostevolved definition of food security so farat the time of writing that we could locatein the literature appears in the State ofFood Insecurity 2001: “Food security [is] asituation that exists when all people, at alltimes, have physical, social and economicaccess to sufficient, safe and nutritiousfood that meets their dietary needs andfood preferences for an active and healthylife” (emphasis added by me). Theinclusion in the definition of ‘social’ accessis highly significant, because itacknowledges that people may be barredfrom access to food even if it is locallyavailable and they have the economicmeans. These social barriers to food

security may include gender, caste, race,disability or stigmatised ailments.

The expulsion of those who most needsupport, care and rights – often by theirown families, by local communities andmost importantly by the State – requiresus to identify those classes, social categoriesand local communities, who are destituteand socially expelled. Even in the moreintimate context of a village, many of thesesocially excluded groups are invisible,barely known and acknowledged. In mostcontemporary cultural contexts, socialcategories that consistently tend to be verydispossessed and vulnerable in their accessto food include disabled people, both asbread winners and dependents; singlewomen and the households that theyhead; aged people especially those leftbehind when their families migrate orthose who are not cared for by theirgrown children; people with stigmatisedand debilitating ailments such as TB, HIVAIDS and leprosy; working and out-of-school children; and bonded workers. Inaddition, in diverse cultural and socio-economic contexts, others may be addedsuch as certain denotified and nomadictribes in one place, some speciallydisadvantaged dalit groups like Musaharsor Madigas in another, weavers, artisansand particularly disadvantaged minoritygroups in yet another, all designated“primitive tribal groups”, survivors ofconflict and internal displacement, andmany other diverse forgotten people.Many of them are of contested citizenship.

In the bridge between rural and urbandestitute are the distress migrants, at thebottom of the heap. In the urban context,there are the street children, with orwithout responsible adult caregivers,urban homeless people, slum dwellers anda wide range of unorganised workers, bothseasonal migrants and settlers such asrickshaw pullers, porters, loaders,construction workers and small vendors,and people dependent on begging.

Government programmes are woefullyinadequate to address destitution. In fact,they tend to be blind to or in denial of thefact that large numbers of people lack even

Aiming for a Substantive Food Security ActDestitution, Social Barriers and Food Rights


the elementary means and power tosurvive with dignity. It is stressed that thisis a duty of the State not to the dead,but to the precariously living. It requirespublic vigilance about individuals,communities and several categories livingwith starvation and absolute hunger. Itrequires the State to act, not after thereis an emergency like a drought or flood,not even after people die of starvation,

Universalising ICDS: Skewed Outreach and Poor Service Delivery

1 Quoted by Barbara Harriss-White in ‘Destitution in India’, a paper for the Conference Inequality, Poverty and Well Being, Helsinki, Finland, 30-31 May2003.2 Barbara Hariss-White, ibid.3 De Haan, A. (1998) ‘Social Exclusion: an Alternative Concept for the Study of Deprivation?’ IDS Bulletin, 29(1), p.10.

but pro-actively before people slip intodestitution, and fail to access in an assuredand reliable manner the nutritious andculturally appropriate food they requireto lead healthy lives.

Gandhi offered us a ‘talisman’ to use inmoments of doubt and confusion. Heasked us to recall the face of the poorest,most defenceless, most powerless man we

have encountered. (Today he would haverecognised that she would probably havebeen a woman!). Ask ourselves whetherwhat we are attempting has meaning forthis person: does it touch her life withdignity and worth? Does it augment herpower and self-reliance? If it does, it mustsurely be the right thing to do. It is thistalisman that we need to hold up to publicpolicy.

Destitution, Social Barriers and Food Rights


It is not surprising that questions of foodsecurity and the right to food have becomesuch urgent political issues in India today.Rapid aggregate income growth over thepast two decades has not addressed thebasic issue of ensuring the food security ofthe population. Instead, nutritionindicators have stagnated and per capitacalorie consumption has actually declined,suggesting that the problem of hunger mayhave got worse rather than better.

Consider the evidence on nutritionaloutcomes from the most recent NationalFamily Health Survey (NFHS) conductedin 2005-06. According to this, 46 percentchildren below 3 years are underweight;33 percent women and 28 percent of menhave Body Mass Index (BMI) belownormal; 79 percent children aged 6-35months have anaemia, as do 56 percent ofever married women aged 15-49 years and24 percent of similar men; 58 percent ofpregnant women have anaemia. Thenational averages mask locationaldifferences: all these indicators are muchworse in rural India.

Further, these indicators have scarcelychanged, or have changed very little, sincethe previous NFHS in 1998-99. In termsof calorie consumption, the picture is evenworse. According to the National SampleSurvey Organisation (NSSO) survey of2004-05, the average daily intake ofcalories of the rural population hasdropped by 106 Kcal (4.9 percent) from2153 Kcal to 2047 Kcal from 1993-94 to2004-05 and by 51 Kcal (2.5 percent)from 2071 to 2020 Kcal in urban areas.The average daily intake of proteindecreased from 60.2 to 57 gm in ruralIndia between 1993-94 and 2004-05 andremained stable at around 57 gm in urbanareas during the same period.

The recent rise in food prices in India islikely to have made matters much worse,and the effects of the global crisis onemployment and livelihoods within thecountry are likely to cause furtherdeterioration in people’s access to food.So questions about legislating the right tofood and ensuring policies that actuallyprovide food security become crucial.

The most loose definition of food securityis one in which the population does notlive in hunger or fear of starvation. Butrecent definitions have been morestringent. According to the Food andAgriculture Organisation (FAO), foodsecurity in a particular society exists “whenall people, at all times, have access tosufficient, safe and nutritious food to meettheir dietary needs and food preferencesfor an active and healthy life.”

Such a definition appears to be simple,but is actually quite complex and begsmany questions. What is “sufficient”? Howis access to be determined and provided?To what extent must food preferences betaken into account? All these questionsbecome even more important when foodsecurity is sought to be converted into alegally justiciable right.

It is evident that genuine food securityamong a population requires a wide rangeof features, all or many of which areassociated with the need for some publicintervention. Ensuring adequate suppliesof food requires increases in agriculturalproductivity, possibly changes in croppingpatterns, and certainly the sustainedviability of cultivation, all of which wouldbe necessary at both local and nationallevels. Making sure that food can beaccessed by all the people requires thatthey have the purchasing power to buy the

necessary food, which in turn means thatemployment, remuneration and livelihoodissues are important. Social discriminationand exclusion still play unfortunately largeroles in determining both livelihood andaccess to food by different socialcategories, and this too needs to bereckoned with.

Malnourishment is closely linked to poorsanitation and other unhealthy practices,so that the provision of clean drinkingwater, sanitation and access to other basicamenities, as well as knowledge aboutcorrect or desirable eating habits, are allnecessary. Child malnutrition in Indiatends to be the worst at the age of 5 to 11months, which suggests that breast-feedingand weaning behaviour matters – and thisemphasises the need for society to educatemothers and to enable them to continuebreast-feeding and shift to appropriatesolids when required.

All of these issues must be addressed if therampant problem of undernutrition hasto be dealt with. But obviously most ofthese cannot easily be translated into legalprovisions and so it is clear that a law,however well-intentioned and carefullyphrased, can only address some of thecomplex factors that determine foodinsecurity. It is important for thegovernment to be aware of the need for amulti-pronged approach to the problemthat has to extend beyond a legal promiseif it is to be successful.

This does not mean that a food securitylaw would be meaningless: far from it. Infact, by focussing on universal food accessand assigning responsibility andculpability, it would force the governmentat both central and state levels to take upthe entire gamut of issues that relate not

*Prof. Jayati Ghosh teaches Economics at Jawaharlal Nehru University, New Delhi, and is the Executive Secretary of International Development EconomicsAssociates (IDEAS); she is also the co-founder of Economic Research Foundation, New Delhi. She is a columnist for a number of journals and newspapers,member of the National Knowledge Commission advising the Prime Minister besides being involved with several progressive organisations and socialmovements. She is also a member of CBGA’s Board of Trustees.

Securing Food for the PeopleJayati Ghosh*



just to actual food distribution but also toits production and patterns ofconsumption, so as to eventually ensuregenuine food security.

The key point here is that such a law mustguarantee universal access. The dominantfailing of drafts of the proposed legislationthat have been circulating in variousquarters, is that they do not promise oreven try to aim at universal food access.Instead, they tend to be obsessed withtargeting food security to the BelowPoverty Line (BPL) population and somedefined vulnerable groups. Some draftshave gone even further, by suggesting thatthe non-BPL population be excludedentirely from any public distribution.

There is no question that poor andvulnerable groups have to be the focus ofall public action to ensure food security.But making this a legal provision is likelyto have exactly the opposite effect fromwhat is intended, by actually reducing theaccess of such groups.

There are many reasons why these targetedschemes, and this one in particular, areunlikely to work. Most significant of all,there are the well known errors inherent intargeting, of unjustified exclusion of thegenuinely poor and unwarrantedinclusion of the non-poor. These are notsimply mistakes that can occur in anyadministrative scheme; they are inbuiltinto systems that try to provide scarcegoods to one section of any population. Inhierarchical and discriminatory societieslike India, where social and economic

power is unequally distributed, it requiresno imagination to realise that making ascarce good (cheap food) supposedlyavailable only to the poor is one of theeasiest ways to reduce their access.

The second problem relates to thedistinction between food insecurity andpoverty as currently defined. It is evidentfrom NSSO and NFHS surveys that theproportion of the population that isnutritionally deprived is significantly largerthan the “poor” population, and in manystates they are not completely overlappingcategories either. To deal with foodinsecurity in an effective manner, it iscounterproductive to base public foodprovision on a predefined group of the“poor”, which would deprive a largenumber of others who are also food-insecure.

Part of the reason for this relates to thethird problem the absence of any notionof dynamics in a rigid law that defines“poor” and “vulnerable” households in astatic sense and changes the group only atinfrequent intervals. Households – andpeople within them – can fall in or out ofpoverty, however defined, because ofchanging material circumstances. Similarly,they can also go from being food-secure tofood-insecure in a short time. The reasonscan vary: crop failures, sharp rises in theprice of food, employment collapses,health issues that divert householdspending, the accumulation of debt, andso on. Monitoring each and everyhousehold on a regular basis to check

whether any of these or other features hascaused it to become food-insecure is notjust administratively difficult, it is actuallyimpossible.

This is why all successful programmes ofpublic food distribution, across societies,have been those that have gone in foruniversal or near universal access. Thisprovides economies of scale; it reduces thetransaction costs and administrativehassles involved in ascertaining the targetgroup and making sure it reaches them; itallows for better public provision becauseeven the better off groups with morepolitical voice have a stake in making sureit works well; it generates greater stabilityin government plans for ensuring foodproduction and procurement.

Even among the states of India, thosestates that have a better record of publicfood distribution are those that have gonein for near-universal access. Kerala, TamilNadu and Andhra Pradesh all havedefined BPL in such an inclusive way thatthe vast majority of the population isincluded, which makes their schemes closeto universal.

So an effective food security law must beuniversal and not targeted, and it mustprovide for enough food to meetnutrition requirements (both cereals andpulses) for every citizen. This also meansthat the entitlement must not behousehold-based but individual-based.Without these features, the law will not beable even to lay the grounds for genuinefood security in the country.

Securing Food for the People


Climate Change: External and Internal Realities for India

Perspective

In discussing food guarantee, its uniqueand differentiating aspects must first berecognised. Food consumption cannot bepostponed for humans have the basicneed of food for existence. Also, crucially,food is a weapon for subjugation; so itsliberation potential must be invested toensure a vibrant democracy. If wellconceived and implemented, the proposedAct would make freedom/justice withinthe reach of the poor as it wouldembolden them to negotiate/bargainagainst exploitation. Hence, through thislaw, our aim must be to providehouseholds with the confidence ofadequate, nutritious food. Unlike cash,food cannot be printed – it is producedby natural resource endowments andembedded within the ecosystem.

Debating on the food bill must steer clearof food security or starvation. The firsthampers a meaningful discussion on issuesaddressing hunger while the latter is amedico-legal measurement controversy.Experience suggests that the extent ofsubsidy has no bearing on addressinghunger or guaranteeing food; one neednot focus only on pricing it cheap.Targeting need not be on above povertyline (APL) or below poverty line (BPL) butuniversal for all who are food vulnerable –all children below the age of six, all girls upto the age of 18, all pregnant and nursingmothers, all people above 60, all physicallychallenged persons and all short-termdistress migrants.

Approach

We must unbundle each aspect of thediscussion and link it to related legalenactments, constitutional provisions and

court orders. It must also take intoaccount the international covenants Indiahas signed for these reflect on what isalready committed upon. This provokesthe thinking and ambition of activists, tocampaign for and succeed in ensuring theRight to Food; it makes the deliberationseducative while strengthening thenegotiations with the authorities.

The law must clearly stipulate tasks,responsibilities and accountability (and atvarious levels). The funds must beadequate, independent and predictable.Storage proximity and buffer stocks mustbe benchmarked along with the physicaland human resource infrastructurerequired. The legislation must understandand tackle the real power and denialdynamics on the ground and providebargaining safeguards and status for thosewhom the law will serve. In developingsuch a framework, the Bonded LabourSystem (Abolition) Act and ScheduledCastes and Scheduled Tribes (Preventionof Atrocities) Act could serve as valuableguidelines.

Understanding

A plethora of rights – information,education or employment – have beenbrought in after they were easily won.Amid this euphoria, let us note that ittook decades of struggle to earn the rightof association or to form trade unions. Itrecognised adversarial interests and powerdynamics to incorporate legallybinding procedures of arbitration andsettlement. But now, we do not go beyondthe ombudsman, social audit or grievancemechanisms to address power andauthority. Entitlements cannot bedependent on benevolence. Thedeliverance of Panchayat Extension toScheduled Areas Act (PESA), SC/ST Actand Domestic Violence Act from thevictim viewpoint is well known. Unlike

Food Guarantee: Issue is Poor Household Confidence, not Kilosand RupeesK S Gopal* other rights, food is fundamental for

human life and needs a thought trajectorythat understands and is based on itsunique aspect of consumption. It cannotbe postponed. So, how do we guaranteeconfidence in it?

Reality Check

The much-hailed Mahatma GandhiNational Rural Employment GuaranteeScheme (MGNREGS) forms thebackdrop of the thinking on the Right toFood. Although a historical and forwardlooking legislation, what are its lessons?Though labelled a “universal employmentright to all rural households”, it givesemployment only to people capable ofdoing hard manual work. In reality, itserves to address labour marketinadequacy as an additional employmentprovider. The worst affected are areas notusually reached by most governmentservices – remote and interior areas facinghigh incidence of poverty and hunger, andwho at best get a paltry 15 daysemployment.

Nonetheless, it is a good antidote as aneconomic stimulus since it puts purchasingpower with the people. Its stature andinvestment rose in response to the globaleconomic downturn, only to besubsequently constricted (after the crisisreceded) by new rules that delinked it fromminimum wages and consumer price indexfollowed by capping of the already meagreemployment offer etc. The MaharashtraRural Employment Scheme serves thesugarcane production cycle assupplementary wage employment thatkeeps workers in good health during theagricultural season. So it is crucial thatfood provisioning must be built intoeconomy dynamism and not just into thebudget.To qualify as universal rural employmentright, MGNREGS should have actually


*K S Gopal heads the Hyderabad-based Centre for Environment Concerns, which focuses on dry farming and its ecology, food security, and droughtmitigation among other issues. He is also the Chairperson of the National Employment Guarantee Council Committee on Works on Individual Lands inMGNREGS.



addressed all needy people wherein peopledefine their capability and what they candeliver for minimum wage to beguaranteed with the rest being governmentbusiness. Thus, if the NREGS approach isadopted, food will reach only to thosealready fed, albeit more. We must learnthis crucial aspect in shaping the food bill.

Way Forward

Our experience suggests two options toassure food to the needy. Both wereimplemented by the Andhra Pradeshgovernment in drought prone backwardareas, centered on providing confidence tohouseholds on food, and found that withenhanced aggregate grain availability in thecommunity of the poor and hungry canbe eliminated.

In 2002-03, India had huge food stockswith some rotting while there were mediareports of incidents of alleged starvationdeaths. Economists suggested lowering ofthe issue prices to enable off-take. Foodconsumption and purchase was a simpleissue of price elasticity. The Chairman ofHindustan Lever made a powerful plea forit in their annual shareholders meeting.The issue price was lowered but noincrease was observed in the publicdistribution system (PDS) off-take. On theother hand, some food itemmanufacturers and exporters took awayall of it. What was intended to tacklehunger ended up making super profits!The government was happy as the Presswas no longer embarrassing it.

We took a different approach as our aimwas of ending hunger. We proposed to thegovernment to provide food to women

groups on credit. It must be monthlysupplies of 50 kg of rice delivered at thedoorstep during the first week of themonth. Based on income profiling andemployment opportunities, threerepayment models were developed. Teamswere formed to educate borrowers onensuring integrity of the system by resolvingproblems within the women’s groups. Thestate government provided a hundredthousand tonnes of rice. The issue priceremained at the original Food Ministrycosts and higher than what was madeavailable to business by them. In addition,certain transaction costs and savingsamounts were added to adjust repaymentdefault. The scheme was a runaway successand repayment, even though administeredby a government agency, was regular,prompt and hundred percent.

Called the Rice Credit Line, the womenunanimously said: “It is worth a billionrupees and very dear to our heart. Our selfrespect and confidence has gone up. Wecan now face any adversity, as we have foodin our house to feed every ones stomachs”.One of them observed that no one wenthungry as there was enough food in thehouseholds of the habitation that was givento the old and infirm. Migrants were happythat their families back home were fully fed.Can’t such a universal system, withfoodgrains at prices lower than the marketrate, be a way of reaching food to the poorand needy? People are willing to pay buttheir incomes are uncertain while food isneeded thrice every day.

Another approach was adopted in theNational Food for Work Scheme, theprecursor to NREGS. Here 50 kg of riceand eight kg of dal (pulses) were given to all

households coming for work. It isdelivered by the first week of every monthand regardless of progress of work.Officials were hesitant as they felt thatworkers would not come to work as theyhad already received the foodgrains. Infact, the opposite took place as workersundertook work worth all the grains thatthey would get in the first three monthswhile waiting to receive the monthlyentitlement for months after. This scheme,called Food Assurance, was a big success.Addressing a public meeting inHyderabad, UPA Chairperson SoniaGandhi said: “Keep a watch on theimplementation of the programmes toensure that the target groups are notdeprived of the benefits”. Eight districts inthe state fall under 150 backward districtsin the country where a Food Assurancescheme is being implemented. (The Hindu,March 6, 2005).

MGNREGS offers a unique opportunityto wipe out hunger and make the needyfood confident in a short time withoutany augmentation to existing resourceallocations for food. Rapid foodcirculation from farm to mouth can bringdown costs considerably in terms ofstorage and wastage. Its investment, ifplanned well for agriculture development,will enable higher production andproductivity to meet the supplyrequirements along with local production.So, rather than being fixated with issueslike price, subsidy and grain quantum etc.,the discussions should be targeted atbolstering confidence, especially ofhousehold women, as that is the pathwayto meet the expectations of the fooddeprived.

Food Guarantee: Issue is Poor Household Confidence, not Kilos and Rupees


In 1997, following the advice given in aninfluential World Bank document1, theGovernment of India introduced theTargeted Public Distribution System(TPDS) in order to curtail the foodsubsidy2. The policy initiated targeting ofhouseholds on the basis of an incomecriterion, that used the income povertyline to demarcate “poor” and “non-poor”households. More than a decade later, it isclear that the TPDS has not been effectivein ensuring food security to the needy. Thebiggest drawback of targeting has been thelarge-scale exclusion of genuinely needypersons from the PDS. I illustrate thisproblem with data from the 61st round ofthe National Sample Survey (GOI, 2007).The data show that targeting has led, inrural India, to high rates of exclusion ofneedy households from the system and a cleardeterioration of coverage in states like Keralawhere the universal PDS was most effective. Irestrict myself to data for rural areas forthe rest of this note.

The first stage of exclusion is ofhouseholds that do not possess a rationcard (Table 1). Excluding the states of theNorth East,3 the proportion ofhouseholds with “no card” is highest inOrissa - where 33 percent of ruralhouseholds did not possess any type ofration card. Thus, in a state characterisedas “severely food insecure”4 , one-third ofrural households were outside the purviewof the PDS. In another 10 states, morethan 20 percent of rural households didnot possess a ration card. Relatively highcoverage of ration cards, defined as asituation where less than 15 percent ofrural households lacked a ration card, wasobserved in the hill states of HimachalPradesh, Uttarakhand and Jammu andKashmir, in Mizoram and Tripura in theNorth East, in Punjab, Haryana andRajasthan in north-west India, in Kerala

Should Public Distribution System be Targeted?Madhura Swaminathan*

and Tamil Nadu in the south, in Goa andGujarat in the west and in West Bengal inthe eastern part of India. In terms of thefirst cut, namely inclusion of householdsin the PDS through possession of a rationcard, these 13 states with Mizoram andTripura in the lead, are the betterperformers.

From March 2000 onwards, the prices forgrain for above poverty line (APL) cardholders were hiked and the gap betweenbelow poverty line (BPL) and APL priceswidened. In many states, APL prices ofgrain were similar to market prices and, asa result, households with APL cardsstopped participating in the PDS. So, asecond level of exclusion operates forhouseholds possessing an APL card. In alarge majority of states, 60 percent or moreof the population either had no ration card oran APL card, and were thus effectivelyexcluded from the PDS. This includes theBIMARU states, the relatively backwardstates of Bihar, Madhya Pradesh,Rajasthan and Uttar Pradesh. It alsoincludes states like Kerala which was amodel for the rest of the country beforeTPDS was introduced. The exceptionswere Andhra Pradesh and Karnataka –the only two states in which a simplemajority of rural households possessedBPL or Antyodaya cards. Tamil Nadu isalso an exception because it has the sameentitlements for BPL and APLhouseholds.

What are the characteristics of householdswithout a ration card or with an APLcard? Let us consider agricultural labourhouseholds, since manual labourhouseholds are undoubtedly among thosemost in need of access to the PDS. Therewere only four states (Tamil Naduexcluded) in which two-thirds or more ofagricultural labour households held

Antyodaya or BPL cards. These states wereAndhra Pradesh, Karnataka, Jammu andKashmir and Tripura. The all-Indiaaverage indicates that 18.5 percent ofagricultural labour households had nocard and another 33.6 percent had anAPL card. Combining the two, theeffective exclusion was 71 percent in Biharand 73 percent in Uttar Pradesh.

The Tendulkar Committee hasrecommended an all India rural povertyline of Rs.446 in monthly per capitaexpenditure at 2004-05 prices. Taking theclosest expenditure category from the NSSReport (Rs.455 per capita per month), wefind that only 38 percent of householdswith monthly expenditure below this newpoverty line possessed a BPL or Antyodayacard. Of total households with belowpoverty line expenditure, 19 percent hadno card and another 43 percent had anAPL or other card. To put it differently,the error of wrong exclusion was 28.3percent while the error of wrong inclusion(of the so-called non poor) was 12.3percent (Table 3).

In the policy debate in India, the entirefocus appears to be on saving resources,that is, on the errors of wrong inclusion.However, we know that there is a trade-offbetween the two types of errors oftargeting, and there is a strong case for ahigher weight to be attached to the errorof wrong exclusion, as the cost of this ismalnutrition and associated effects onindividual functioning, on productivity,disease burden, and so on. In a countrythat has not been able to meet the firstMDG goal, it is clearly time to attach ahigher weight to the error of wrongexclusion, and to move from narrowtargeting to universal access.

*Prof. Madhura Swaminathan, a development economist, teaches at the Indian Statistical Institute, Kolkata. She was on the High Level Committee of theMinistry of Civil Supplies, Consumer Affairs and Public Distribution, GOI, set up to formulate a “Long-Term Grain Policy”. Her research areas includefood security, agriculture and rural development.



Cost Provisioning towards Right to Food

Table 1: Distribution of households by type of ration card possessed,all states, rural areas (per cent of households), 2004-05

State Antyodaya BPL Other No ration card AllAndhra Pradesh 2.8 53.7 16.0 27.5 100Arunachal Pradesh 0.7 16.1 59.8 23.4 100Assam 0.6 11.8 63.1 24.6 100Bihar 2.3 15.1 60.1 22.5 100Chhattisgarh 4.4 34.9 32.1 28.6 100Goa 5.1 13.4 72.9 8.7 100Gujarat 0.8 36.1 50.4 12.7 100Haryana 2.6 16.0 68.3 13.1 100Himachal Pradesh 6.2 10.6 76.0 7.2 100Jammu and Kashmir 0.5 22.7 73.4 3.4 100Jharkhand 3.0 22.8 51.1 23.1 100Karnataka 9.6 42.1 25.7 22.6 100Kerala 1.8 27.7 57.1 13.4 100Madhya Pradesh 3.3 30.8 38.0 27.9 100Maharashtra 4.4 30.5 46.3 18.9 100Manipur 0 22.3 15.5 62.2 100Meghalaya 2.6 23.6 51.0 22.7 100Mizoram 1.7 36.4 60.6 1.4 100Nagaland 0.4 6.3 3.0 90.4 100Orissa 2.0 42.4 22.5 33.1 100Punjab 0.1 11.9 75.7 12.2 100Rajasthan 2.8 15.7 77.9 3.6 100Sikkim 1.0 39.5 32.4 27.2 100Tamil Nadu 1.5 18.9 68.9 10.8 100Tripura 1.6 38.9 57.2 2.4 100Uttar Pradesh 2.8 13.5 65.1 18.5 100Uttarakhand 2.5 23.2 66.3 7.9 100West Bengal 3.2 27.3 61.1 8.4 100All India 2.9 26.5 51.8 18.7 100

Note: BPL refers to below-poverty-line cards and ‘other’ refers mainly to above-poverty-line or APL cards.Source: Government of India (2007).

Table 2: Distribution of Agricultural labour households by possession of ration card,all States, rural (in per cent of households) 2004-05

State Included (with BPL or Antyodaya card) Excluded (no card) APL/other AllAndhra Pradesh 70.5 18.9 10.7 100Arunachal Pradesh 11.3 41.2 47.5 100Assam 31.4 29.7 38.9 100Bihar 29.1 28.6 42.3 100Chhattisgarh 54.3 29.3 16.5 100Goa 39.1 2.6 58.4 100Gujarat 62.4 9.5 28.1 100Haryana 49.4 4.8 45.8 100Himachal Pradesh 46.7 3.4 49.9 100Jammu & Kashmir 67.7 4 28.4 100Jharkhand 32.7 20.7 46.5 100Karnataka 69.8 14.8 15.4 100Kerala 52.6 16 31.4 100Madhya Pradesh 50.8 27.3 21.9 100Maharashtra 49.7 19 31.3 100Manipur 4 79.5 16.5 100Meghalaya 61.4 20 18.7 100Mizoram 14.7 0 85.3 100Nagaland 0 100 0 100Orissa 59.8 26.7 13.5 100Punjab 23.4 15 61.7 100Rajasthan 32.4 6.9 60.8 100Sikkim 57.9 32.9 9.2 100Tripura 66.6 2.5 30.9 100Uttar Pradesh 27 22.7 50.4 100Uttarakhand 43.2 11.8 45 100West Bengal 47.2 11.6 41.1 100All – India 48 18.5 33.6 100

Source: NSS 61st Round, Report No 510, Table 2R

Should Public Distribution System be Targeted?


1 See World Bank (1996. ‘India’s Public Distribution System: A National and International Perspective’, Poverty and Social Policy Department, November (Reprinted as Radhakrishna, R. andSubbarao, K. 1997. World Bank Discussion Paper No 380).2 See Focus on the Poor. Ministry of Civil Supplies, Consumer Affairs and Public Distribution, Government of India (1997).3 There are some serious problems of data quality in the data for the North Eastern States of India.4 MSSRF (M. S. Swaminathan Research Foundation) and World Food Programme, 2001, Food Insecurity Atlas of Rural India, Chennai.

Table 3: Errors of targeting in distribution of ration cards (for households defined as poorand non-poor by MPCE below the official poverty line), all India, rural (in per cent), 2004-05

Note: Here inclusion is defined as possession of Antyodaya or BPL card and exclusion as possession of APL/Other card or no card.

Category %

Poor included 17.2

Poor excluded 28.3

Non poor included 12.3

Non poor excluded 42.9

All 100

Budget and Policy TrackingShould Public Distribution System be Targeted?


According to the GOI Economic Survey,foodgrain production in India hasdeclined from 208 kg per annum percapita in 1996-97 to only 186 kg in 2009-10, a decline of 11 percent. Despitereduced production, India has beenexporting on an average 7 million tonnesof cereals per annum, causing availabilityto decline further by 15 percent from 510gm per day per capita in 1991 to 436 gmin 2008.

National Sample Survey Organisationdata (61st Round) on consumerexpenditure on food consumptionindicates that as India moved to greaterprosperity in the last 20 years, the cerealconsumption of the rural rich went downbut there was no increase for the poor. Atany given point of time, the cereal intake ofthe bottom 20 percent in rural Indiacontinues to be at least 20 percent lessthan the cereal intake of the top decile ofthe population, despite better access of thelatter group to fruits, vegetables and meatproducts. Their sedentary lifestyle tooshould be taken into account whileassessing the difference between the twogroups. For the upper segment ofpopulation, the decline may be attributedto a diversification in food consumption,easy access to other high value agriculturalcommodities, changed tastes andpreferences, and consumption of moreexpensive non-foodgrain products. Highereconomic growth and per capita incomesthus contribute to reduction in per capitademand for cereals for the rich.

However, for those who are around thepoverty line, this has to be understood as adistress phenomenon, as with marginalincrease in their incomes over time they areforced to cut down on their foodconsumption to meet other pressing

demands of health and education thatwere not considered important in the past.Food is still needed, but not demandedfor lack of money. Endemic hungercontinues to afflict a large proportion ofthe Indian population. Internationally,India is shown to be suffering fromalarming hunger, ranking 66 out of the 88developing countries studied by theInternational Food Policy ResearchInstitute (IFPRI) in 2008. India as part ofthe world community has pledged to halvehunger by 2015, as stated in theMillennium Development Goal 1, but thepresent trends show that this target isunlikely to be met.

Policy recommendations

Food insecurity and hunger is caused by alarge number of factors and hencesolutions too have to be multi-sectoral innature. First, revamp small holderagriculture. Because of stagnating growthin agriculture after the mid-1990s therehas been employment decline, incomedecline and hence a fall in aggregatedemand by the rural poor. The mostimportant intervention that is needed isgreater investment in irrigation, power,and roads in the poorer regions. It isessential to realise the potential forproduction surpluses in Central andEastern India, where the concentration ofpoverty is increasing.

Second, launch massive watersheddevelopment programmes in central India,where most tribes live. In a successfulwatershed programme the poor benefit inthree ways. First, as the net sown area andcrop intensity increases, moreopportunities for wage employment arecreated, which may also increase the wagerate besides the number of days of

employment. Second, increased wateravailability and reduced soil erosionincreases production on small andmarginal farmers’ lands. And last, thehigher productivity of Common PropertyResources improves access of the poor tomore fodder, fuel wood, water and NonTimber Forest Products (NTFPs).NREGA assets should be monitored forat least five years to establish their linkswith drought proofing and enhancedavailability of water.

Third, start a drive to plant fruit trees ondegraded forests and homestead landsthat belong to or have been allotted to thepoor. This will not only make the poorpeople’s diet more nutritious, but will alsodiversify their livelihoods and reduceseasonal vulnerability.

Fourth, create more job opportunities byundertaking massive public works indistricts with low agricultural productivity.The upper limit of work guarantee of 100days per worker should be enhanced to150 days through an amendment in theRules in the poorest 200 districts. Fifth,improve the skills of the poor for marketoriented jobs, so that they are absorbed insunrise industries such as hospitality,security, health and construction.

Sixth, launch a drive in collaboration withcivil society to cover the poorest, as a largenumber of homeless and poor living inunauthorised colonies in urban areas havebeen denied ration cards, and are thus notable to avail of the Public DistributionSystem, on the ground that they do nothave an address! In Rangpur Pahadi, aslum area just two kms from Vasant Kunj(Delhi), people living since 1990 have notbeen given even voter ID or any rationcards. Thus their very existence is deniedby the Delhi Government!

Seventh, give shops to panchayats,women’s self-help groups, or to those whoalready have a shop so that it remainsopen on all days. Making it obligatory for

Food Security in IndiaN.C. Saxena*

*Dr. N.C. Saxena has had a distinguished career in the Indian Administrative Service and academics, retiring as Secretary, Planning Commission. He iscurrently a member of the National Advisory Council and Supreme Court-appointed Commissioner on Right to Food. He is also Senior Advisor, UNICEFIndia, and a visiting fellow to several educational institutions abroad.


dealers to sell non-cereal items will ensurebetter communication between the dealerand the card holders.

Eighth, prepare a comprehensive list everytwo years of the destitute needing free orsubsidised cooked food. Open up mid-daymeals kitchen to the old, destitute andhungry in the village. This is already beingdone in Tamil Nadu, and its replication inother states should be funded by the GOI.Establish community kitchens across citiesand urban settlements to provideinexpensive, subsidised nutritious cookedmeals near urban homeless and migrantlabour settlements.

Last, India requires a significant increaseof targeted investments in nutritionprogrammes, clinics, disease control,irrigation, rural electrification, rural roadsand other basic investments, especially inrural India, where the current budgetaryallocations are inadequate. Higher publicinvestments in these areas need to beaccompanied by systemic reforms that willoverhaul the present system of servicedelivery, including issues of control andoversight. Outlays should not beconsidered as an end in itself. Delivery offood-based schemes requires increasingfinancial resources, but more importantly,the quality of public expenditures in theseareas. This in turn requires improving thegovernance, productivity andaccountability of government machinery.

Food Security Bill

The proposed Act will be enforced largelythrough the Targeted Public DistributionSystem, which unfortunately suffers fromsevere systemic flaws. The PlanningCommission Survey (2004) says that 58percent of the subsidised foodgrains donot reach the BPL families, with 36percent sold in black. Diversion ofcommodities is a big problem due to lackof transparency, low accountability andpoor monitoring in the scheme’simplementation.

Food Ministry should ‘own’ the PDS –The Centre cannot close its eyes to large-scale fraud in PDS by taking a narrow‘constitutional’ position thatimplementation is the State’sresponsibility. The Food Ministry shouldhave a greater sense of ownership of thescheme, and improve its oversightmechanisms. For instance, it should startan annual impact study of the PDS,especially in the poorer states.

Universalise PDS in five years – All basicentitlements should be universal. Food forall, health for all, education for all, workfor all – these should be taken as thebottom line. Thus food security is neededfor all, and not only for those who areofficially below the poverty line. This issueis particularly relevant for combating foodrelated hunger, because the number offood deficit people is at least double thenumber of officially declared poor inIndia. Therefore all out efforts should bemade to increase foodgrain productionand procurement, especially of millets andnutritious grains (the so-called coarsegrains), so that the government hasenough stocks after five years touniversalise PDS. In the interim, thepoorest 150 districts (which will covermost of the tribal majority areas incentral India) should have universalPDS. In no case export should bepermitted. If basmati is to be exported,equal amount of ordinary (or evenbroken) rice should be imported.

Create new entitlements – The Act mustalso create new entitlements for those whoare excluded from existing schemes,including out-of-school children, theelderly and the infirm in need of dailycare, migrant workers and their families,bonded labour families, the homeless, andthe urban poor. Households holding anAntyodaya Card should be entitled to 5kg of pulses at a price not exceeding Rs20/kg and 500 gm of oil at a price notexceeding Rs 35/kg under the PDS.


Reduce exclusion and inclusion errors inidentifying the poor – According to the11th Five Year Plan (Volume 2, Chapter 4),there are huge exclusion and inclusionerrors in identifying the poor. More thanhalf of the poor either have no card orhave been given above poverty line (APL)cards, and are thus excluded from belowpoverty line (BPL) benefits. These must bepresumably the most poor tribal groups,women headed households, and peopleliving in remote hamlets whereadministration does not reach. Thus thepeople most deserving of government helpare deprived of such assistance. On theother hand, almost 60 percent of BPL orAntyodaya cards have been given tohouseholds belonging to the non-poorcategory. This needs to be corrected bylaunching a drive to weed out errors ofexclusion and inclusion.

Provide cash subsidy? – Large scalesubstitution of PDS by direct cashtransfers (DCT) is not feasible, asfoodgrains purchased from the farmersthrough Minimum Support Price (MSP)mechanism need an outlet fordistribution. Besides, DCT requires agood banking structure, functionalregistration system and widespread use ofdebit cards. At best, it could be tried on apilot basis in a few poor localities ofmetropolitan cities.

The right to food cuts across programmesof many sectors – including health,nutrition, agriculture, livelihoods, genderand water. This means that in any context,at least half a dozen ministries will beoperating programmes that have someimpact on availability, access andabsorption of food. Converging all ofthese under a central leadership is critical.Brazil converged as many as 31programmes which are now overseen bythe Ministry of Food Security andcombating hunger. It is imperative thatour proposed legislation brings togetherall these programmes on a single convergedplatform.

Food Security in India


India has many international obligationsto fulfill the right to food with respect tochildren and adults. The Indianconstitution also indirectly refers to thisright. Therefore, there is an obligation forthe government at the Centre and in thestates to meet the people’s right to food. Inspite of many programmes, there areconcerns regarding access to food andmalnutrition.

The Presidential address to Parliamentand the Union Budget 2009 indicate thatthe government would enact a law that willprovide a statutory basis for a frameworkwhich assures food security for all.According to this proposed law, everyfamily below the poverty line (BPL) inrural as well as urban areas will be entitledby law, to 25 kg of rice or wheat permonth at Rs. 3 per kg. The EmpoweredGroup of Ministers (EGoM) indicates theBPL population based on the TendulkarCommittee report to be 37.2 percent.There are three problems with thisapproach – (a) There are many targetingerrors with the BPL approach; (b) Riceand wheat only partially fulfils right tofood as we need other commodities in thediet; (c) nutrition security also has to beincorporated in right to food. TheNational Advisory Council (NAC) hasrecently proposed “priority” category and“general” category instead of BPLapproach to cover 75 percent of thepopulation.

There has been a serious debate on thequestion: Should the public distributionsystem (PDS) be targeted or universal?The advantage of universal PDS is thattargeting errors can be minimised,particularly the exclusion error (exclusionof poor). Also, right generally refers to theentire population.

Right To Food and National Food Security Act S. Mahendra Dev*

Need for Comprehensive FoodEntitlement Act: The originally proposednational food security law is too confined.The Right to Food (RTF) campaigndemands a comprehensive “FoodEntitlements Act”. It goes beyond thenarrow promise of supplying foodgrainsto the BPL population. “Aside from anoverarching obligation to protect everyonefrom hunger, as well as to promotesustainable and equitable foodproduction, essential provisions of theproposed Act include: a universal publicdistribution system (providing at least 35kg of grains per family); special foodentitlements for destitute households(including an expanded AntyodayaProgramme); consolidation of allentitlements created by recent SupremeCourt Orders (e.g., cooked Mid Day mealsin primary schools and universalisation ofICDS); support for effective breastfeeding(including maternity entitlements andcrèches); safeguards against the invasion ofcorporate interests in food policy; andelimination of all social discrimination infood related matters.” The campaignfurther says the Act must have strongaccountability and grievance redressalprovisions including mandatory penaltiesfor any violation of the Act andcompensation for those whoseentitlements have been denied”1

It is argued in general that RTF in terms ofproviding food and nutritional security toall is a much broader concept than theproposed National Food Security Act ofproviding 25 kg of foodgrains at Rs.3/kg.Many things have to be included in orderto have genuine “right to food”. There isan obligation to fulfill the right to food ofthe people2. As Jean Dreze mentions, RTFcan be seen from three perspectives: IndianConstitution, international declarations

and moral and social right. Its corecontent refers to availability, accessibility,adequacy and sustainability.3

A summary of demands of the Right toFood Campaign on the legal guaranteespertaining to the National Food SecurityAct are as follows:

● Remove APL, BPL – subsidised foodfor all.

● Nutritional Security with per headmonthly entitlements of 14 kg ofcereals, 1.5 kg of pulses and 800 gmof oil.

● Expand PDS procurement and usePDS to revitalise agriculture.

● Make procurement and distributionlocal and decentralised.

● Children’s right to food be ensured.

● Special rights for vulnerable andexcluded sections.

● No cash transfers.

● Food entitlement cards in the nameof women.

● Effective grievance redressalmechanisms, with punishments,penalties and compensation.

● Affirmative action for dalits, adivasisand other socially discriminatedgroups.4

Right to food has to cover the entire foodsecurity system including procurement,buffer stocks and PDS rather thanconcentrating on the latter only. Theprocurement policy is also important forthe success of RTF and the present policyhas its set of problems. It is benefiting fewregions and few crops. We need to haveprocurement facilities in eastern states likeBihar and Orissa.

*Prof S. Mahendra Dev is currently the Director of the Indira Gandhi Institute of Development Research, Mumbai. A development economist, he haswritten on agricultural development, food security and employment guarantee schemes. He was formerly Chairman, Commission for Agricultural Costs andPrices and has also been associated with international organisations like UNDP, World Bank, International Food Policy Research Institute and ESCAP.



Recent Proposals of National AdvisoryCouncil

Keeping in mind the budgetary andfoodgrain constraints of the government,the National Advisory Council (NAC)proposed a “near universal withdifferential entitlements” food securityprogramme. According to NAC, at least75 percent of the country should getsubsidised foodgrains. This is furtherbroken down as 90 percent of allhouseholds in rural India, and 50 percentin urban areas. NAC is not using BPLcriteria but has suggested two broadcategories – “priority” and “general” –eligible under the proposed food securitylaw. The NAC has based on the Tendulkarpanel report to quantify the twocategories. Accordingly, the prioritycategory is estimated to include 46 percentof all households in rural areas and 28percent in urban. The general category isat 44 percent of all rural households and22 percent of urban.

Regarding the entitlement, NAC hasproposed that the priority category willreceive a monthly entitlement of 35 kg offoodgrains at a subsidised price of Rs.1 perkg for millets, Rs.2 per kg for wheat andRs.3 per kg for rice. The general categorywill get a monthly entitlement of 20 kg. offoodgrains at a price, which would notexceed 50 percent of the minimum supportprice (MSP). The prices would remainunchanged till the end of 12th Five YearPlan. It recommended implementation ofthe first phase from the next financial year,2011-12, and complete coverage by 2013-14. NAC will also examine proposals forPDS reforms including decentralisedprocurement and storage; and de-privatisation of PDS outlets as inChhattisgarh where these are run by selfhelp groups and other village bodies.

NAC’s food security bill also includes legalentitlements for child and maternalnutrition, as well as for communitykitchens and programmes for feeding thedestitute and vulnerable groups. NAC hasrecommended universalising primaryhealthcare, extending nutrition and healthsupport to adolescent girls, strengtheningthe school health programme, theprogramme for vitamin A, iodine andiron supplementation and the nationalprogramme for kitchens.

The NAC proposals on food security billare much better than what thegovernment had originally proposed.But, they fall short of the proposals ofthe Right to Food campaign whichrecommended universal PDS. It may benoted that although NAC calls it“priority” criterion, the proposal seems tobe again following the BPL approach.

Focus on Nutrition: At the national andinternational levels, it is recognised thatthe ultimate objective of the right to foodis the achievement of nutritional well beingof adults and children. Thus, RTF needsto be understood in a much broader senseas the right to adequate food andnutrition. The Prime Minister referred tothe malnutrition situation in India as a“national shame”. It is known that calorieintake is only one of the determinants ofmalnutrition. Therefore, giving foodgrainsat subsidised prices would lead to onlypartial fulfilment of food and nutritionalsecurity.

Undernutrition across states varies from21 percent in Mizoram to 60 percent inMadhya Pradesh as per 2005-06 statistics.It is relatively low in Kerala, Goa and theNorth Eastern states. Gender inequality isan important factor that determinesmalnutrition levels. A distinction can be

made between direct or immediate orindirect but substantive and institutionalfactors. For example, food intake, micronutrients, diet diversification, health,water and sanitation are directdeterminants while women’sempowerment, agriculture, rural non-farsector etc. are indirect determinants.Women’s health, education andempowerment play an important role forlower malnutrition in some states. Ingeneral, gender equality and the well-beingof children go hand in hand. The rights ofwomen and children are mutuallyreinforcing. Apart from these factors,hygiene, sanitation and clean drinkingwater play a crucial part since sick childrenare not able to absorb essential nutrients.

India has government programmes such asTargeted PDS including Antodaya AnnaYojana, nutrition programmes like MidDay meals, the Integrated ChildDevelopment Services to improve foodand nutrition security. At the same time,there is a need for improvement in healthservices, empowerment programmes forwomen, programmes on sanitation,drinking water and hygiene. Theeffectiveness of these programmes have tobe increased in order to realise the right tofood.

International experience also shows thateffective implementation of directprogrammes have improved food andnutrition security. Thailand is consideredone of the most outstanding success storiesof reducing child malnutrition post-1970s.The country launched large focussedprogrammes on nutrition in 1977. Thechild malnutrition declined from 51percent in 1979-82 to 17 percent in 1991.The success is attributable more to thedirect nutritional programmes of the govt.than only to rapid economic growth.

1 Khera, Reetika (2009), “Right to Food Act: Beyond Cheap Promises”, Economic and PoliticalWeekly, July 18, Vo.42, No.29.2 Dev, S.Mahendra (2003), “Right to Food in India” Working Paper no. 50, Centre for Economic and Social Studies, Hyderabad, Dev, S.Mahendra (2008); “Inclusive Growth in India:Agriculture, Poverty and Human Development”, Oxford University Press, Delhi; and, Gaiha, R. (2003), “Does Right to Food Matter?”, Economic and Political Weekly, Vol.38, no.40, pp.4269-4276, October 4, 2003.3 Dreze, J. (2004), “Democracy and Right to Food”, Economic and Political Weekly, April 24.4 Right to Food Campaign (2010), “National Food Security Act, An Introductory Primer on the Legal Guarantees Demanded by the Right to Food Campaign”, http://www.righttofoodindia.org.

Right To Food and National Food Security Act


The case of the Food Security Bill getscuriouser and curiouser. What started offas a fight between universalisation andtargeting has ended (or so it would seem)in a complete victory in the NationalAdvisory Council (NAC) of theGovernment of India for targetingthrough universalisation (if such a thingwas possible), with the honourableexception of Prof Jean Dreze, who has tobe commended for his “note ofdisagreement”.

The Proposal

On 30th August, 2010, the NAC WorkingGroup had recommended“universalisation with differentiatedentitlements”, dividing the poor into twocategories, 42 percent in antyodaya andthe rest in aam (general). They found thebest way to kill a Bill; make it socomplicated that it is completelyunworkable in practice. A complicated Billalso means that there is immense scope forbureaucratic intervention andinterpretation, with a high degree ofarbitrariness. Too much power gets vestedin the hands of the Central governmentsince an Act of this kind will leave moreand more provisions to the Rules, wherethe executive has immense discretion andessentially needs to notify each decisionwithout passage by the legislature. Often,Rules are in variance with the intent ofParliament.

This is precisely the direction in which thehighly awaited food security bill is headedin the NAC. When the initial attempts bygovernment to target food security to asmall section of India’s hungry people metwith stiff resistance, the governmentdecided to be more innovative, andinstead of an openly exclusionaryapproach, it decided to obfuscate issues ina confusing labyrinth of entitlements,categories, prices and phases. The ‘Gist of

Decisions’ taken by them on 23rd October2010 rechristens (presumably) belowpoverty line (BPL) as “priority”, abovepoverty line (APL) as “general”. It increasesthe percentage of priority households forrural areas by 4 percentage points and forurban areas by 2 percentage points whencompared to Tendulkar Committeeestimates. The inter se share of each state isto be in accordance with the discreditedPlanning Commission ratios. To thesehouseholds, it gives 35 kg rice, wheat ormillets at Rs.3, Rs.2 and Re.1, respectively.Thus, the Antyodaya entitlements are nowto be given to all priority households. Thegeneral category households will comprise44 percent of the rural households and22 percent of the urban households, andwill be entitled to 20 kg per month at halfthe Minimum Support Price (MSP). Thus90 percent rural households and 50percent urban households are to becovered with unequal and differentiatedentitlements. The mechanism and criteriafor their identification/selection is leftonce again to the prime architect of thepresent disastrous system, namely, theCentral government.

Table 1 clearly shows the statisticalskulduggery that is involved in an exerciseby which the NAC in fact reduces thenumber of priority households (aeuphemism for BPL) by 2.11 crore (11crore persons) as compared to the presentnumber of actual cardholders. In fact, thecurrent situation is that 56 percent of the2001 population has already got BPLcards. By a clever sleight of hand, this willcome down by 14 percentage points in theNAC formulation, a removal of 3.4 crorehouseholds (a whopping 18.8 crorepersons).

Widespread Hunger RequiresUniversalisation

In a country where existence at sub-optimal levels of food consumption

occupies the space between life and deathfor many, the argument in favour of auniversal system of food security is socompelling that nobody, not even themost parsimonious fiscal expert, canrefute it. The government has alwaysspoken about “food security for all”. Thisis not surprising since endemic hungercontinues to badly affect a large section ofthe Indian people. The InternationalFood Policy Research Institute (IFPRI)’sGlobal Hunger Index (GHI) places Indiain the category of nations where hungerwas ‘alarming’, ranking 66 out of the 88developing countries. IFPRI estimates ofthe hunger index for the17 major states in2008 (more than 95 percent of thepopulation of India), put 12 into the‘alarming’ category, and one into the‘extremely alarming’ category. High levelsof hunger are seen even in high growthstates. Expectedly, the backward easternand central region has the worstperformance.

Eighty percent of the rural population, 64percent of the urban population, and 76percent of the total population sufferfrom inadequate calorie and foodconsumption. More than half of India’swomen and three-quarters of children areanaemic, with incidence among pregnantwomen an even higher 59 percent. Theproportion of underweight childrenremains at around 48 percent for the past20 years. 30 percent infants have low birthweight. One in every three adult Indian hasa body mass index (BMI) below 18.5indicating chronic energy deficiency(CED). The obvious strategy to tacklehunger and malnutrition is to universaliseand strengthen the Public DistributionSystem (PDS) by making adequate foodavailable at affordable prices. Thegovernment must scrap targeting;universalise the PDS and delinkentitlements from the PlanningCommission’s wobbly poverty estimates;

*Smita Gupta is a well-known development economist. She has been associated with the Institute for Human Development and is also part of the Researchwing of CPI (M).

Food Security sans PDS: Universalisation through Targeting?Smita Gupta*


include commodities like pulses, sugar,cooking oil and kerosene at subsidisedrates; incorporate all food and nutritionschemes of the Central government such asthe Mid-Day Meal scheme and IntegratedChild Development Services (ICDS)nutrition programme in the proposedlegislation. But NAC does not recommendthis. Why?

Why Target?

“It would be so nice if something madesense for a change.” Why these miserlyprovisions that are not in line with what isrequired? When the experience with theTargeted PDS has shown that faultyexclusion and inclusion abound, and theexclusion is a direct violation of the rightto life, why would any serious scholar,policy maker and activist agree totargeting?

There are three ‘infeasibility’ argumentsagainst universalisation articulated moststrongly by the Planning Commission andthe Chief Economic Advisor.

(1) Supply constraint: production andavailability of grain is not enough tomatch the potential demand of asubsidised universal system.

(2) Financial constraint: a universalscheme with subsidised grain is tooexpensive and unaffordable since thegovernment does not have enoughmoney.

(3) Governance constraint: the PDS isalready ‘groaning’, ‘overburdened’,‘inefficient’, ‘costly’ and ‘corrupt’,and expanding it will lead to itsimminent collapse.

Let us begin with the ‘production’argument. The most important point isthat neither production norprocurement are rigid or fixed and areboth highly responsive to governmentpolicy and intervention. India is far fromreaching the upper limit of either, and thescope for reducing the slack is enormous.

Availability of foodgrain is an essentialprerequisite for food security. Unlike whatthe government proposed in the note

prepared by the food ministry,compulsory procurement and imports areneither necessary nor desirable. Foruniversal entitlements, self sufficiency infood production is necessary at thenational level, is highly desirable at theregional level and is beneficial at the locallevel. Roughly a hundred million tonnes ofcereals are required for a universal PDS(with 80 percent off-take and 35 kg perhousehold), which is 57 percent of totalproduction net of seeds and wastage.Currently, procurement is about 30percent of production. Given thegeographically unequal concentration ofproduction and procurement in India,most of this is from 4-5 states. Expandingguaranteed procurement to all states andcrops, announcing cost-covering MSP inadvance, strengthening the decentralisedprocurement scheme, building storagesand godowns in many more places, givingincentives to local doorstep procurementand making timely payments to farmersare simple measures to increaseprocurement.

Table 1: The Numbers Game

1 Current BPL families in crores permitted by Planning Commission based on 1993-94 poverty level of 36 % 6.52and 2001 population (projected from 1991) i.e., 99.69 crore and not actual 102.87 crore

2 Number of households (persons) left out in 2001 due to continued usage of projected rather than actual 0.39 (2.14)population of 2001 in crore

3 If the currently applied 1993-94 poverty level (36%) is applied to the current population, number of BPL 7.92households in crore

4 Number of households (persons) left out in 2010 due to continued usage of projected rather than actual 1.4 (7.7)population of 2001 in crore (2010 population at 117.67 crore or 22 crore households)

5 BPL families actually issued cards in crore 11.04

6 Households holding cards as a % of 2001 population 56

7 If Tendulkar 37.2% is given BPL status, their number in 2010 in crore 8.18

8 If existing share of 56% applied to 2010, number of BPL households in 2010 in crore 12.32

9 NAC priority households in rural areas (46%) 7.29

10 NAC priority households in urban areas (28%) 1.6

11 NAC priority households in 2010 in crore (total) 8.89

12 Reduction in number of eligible households (persons) as compared to present number in crore( Row 5 minus Row 11) 2.11(11.61)

13 Reduction in number of eligible households (persons) as compared to present percentage in crore(Row 8 minus Row 11) 3.43 (18.87)

Food Security sans PDS: Universalisation through Targeting?


These are of course steps to be takenimmediately. In the medium term, it isessential to improve production andproductivity of food production throughpublic investment, provision of extensionservices, inputs at controlled prices,appropriate land use policies withguaranteed fair prices for farmers througha stronger network of geographicallydispersed procurement centres. A specialpackage for adivasi farmers and drylandfarming will encourage the production ofpulses, millets and coarse grains suited todry and non-irrigated land.

In any case, the ground reality is not of asupply-constrained system but excessivestock-holding! The fact is that thegovernment is once again holding 60million tonnes, well over the buffer norms.Since perverse fiscal conservatism does notpermit its distribution, the holding inexcess of storage capacity (roughly 15million tonnes) is lying in the open, andoften rotting even as vast sections gohungry. Since targeting is not going toreduce these stocks, and rabi procurementis likely to be high due to a bumper crop,the bizarre situation of hunger amidstoverflowing stocks will persist.

This has caused embarrassment, politicallyand from the judiciary, prompting theCentral government to accept the higherTendulkar estimates on poverty, andincrease APL allocations. The currentstock and supply situation is more thancomfortable, set to improve after rabi.This offers a golden opportunity toargue for universalisation bydistributing a minimum quantum offood at affordable prices to largernumbers across the country, and in theprocess to expand the PDS. Those whowant to reduce subsidies will of courseargue that food stocks should be reducedthrough open market sales and exportsand future procurement should bereduced sharply along with targeting onlythe poor. This has to be resisted because asfar as money is concerned, it is entirely aquestion of prioritisation.

Compared to many advanced countries,India’s tax-GDP ratio is very low (around

18 percent compared to 28 percent forUSA and around 45-50 percent forScandinavian countries). Compare this tothe tax foregone by the CentralGovernment on Corporate Income Tax,Personal Income Tax, Excise and Customsat Rs.5,02,299 crores in 2009-10 (79.54percent of the aggregate tax collection),and Rs.4,14,099 crore in 2008-09 whichis 68.59 percent of aggregate tax collection(the budget documents say that this is anunderestimation). This is over ten timesthe current food subsidy bill and fourtimes the requirement for a universalPDS with 35 kg per household at anaverage price of Rs 2 per kg.

It is the fiscal concern to reduce subsidiesthat has led to the pricing policy that linksthe MSP or cost of acquisition to the issueprice, to sell the food at some proportionof the economic cost. However, foodsecurity has two aspects, production andconsumption. Farmers or producers needto cover their cost of production and iffarming is to once again become a viableactivity, profitability has to be maintainedthrough assured procurement. Consumerson the other hand are constrained bytheir ability to pay, and prices for themhave to meet the yardstick of affordability.If consumer affordability and producerprofitability both have to be ensured forfood security, the two prices cannot be thesame. This rather devious attempt tolegally link consumer subsidy to farmersubsidy will open the gate to politicalconflicts between the two and in manycases where the farmer is also a netpurchaser of foodgrain, giving MSP withone hand and taking away through higherfood prices with the other.

There is no doubt that the PDS is veryweak in some parts of the country. Thesolution that several governmenteconomists offer is to go in for direct cashtransfers or food coupons with biometricsand Unique Identification (UID) to plugleakages. Women are considered to bemore efficient agents for these transactionsdue to their patriarchy-drivenresponsibilities. This ignores the problemof exclusion and inflation. Destroying anadmittedly problematic PDS does not put

food on the table. The obvious solutionsto inadequacy, inefficiency and corruptionare to increase infrastructure,accountability and reform the PDSthrough various measures. This cannot beused as an argument against theentitlement. After all, massive corruptiondid not stop the Commonwealth Gamesor defence deals or large infrastructureprojects. A few committees are set up, andthe loot goes on unabated, in the “publicinterest” for “national honour”. So whydoes the fear of corruption only becomean effective roadblock for food security? Isthere anything honourable about hungerand starvation?

Therefore, neither the fiscal nor thesupply nor the governance constraint isoperational and an expanded PDS canin fact boost both production andgrowth and hence government finances.Recently, a rather odd argument againstdesirability of universalisation has beenattributed to the UPA Chairperson.

(4) Political constraint: it is difficult toexplain to the poor why the rich aregetting the same.

This is a rather pathetic attempt toconcoct an unfounded psycho-socialargument, attribute it to the poor and useit to undermine their interests! The poorare not vindictive, perverse or self-destructive. If they get adequate andaffordable food, they are unlikely togrudge someone better off getting thesame. They know from experience thattargeting subsidies in an unequal andhierarchical system creates incentives forthe elite to fraudulently garner the benefit,which they do. They know that there areso many people who need food thatselecting makes little sense. So it is better toinclude everyone since the exclusionarysystem will only work against the poor.

It is therefore time that the NAC and thegovernment stop prevaricating by puttingforward specious arguments against auniversal bill and instead use the currentfood stocks and the forthcoming rabicrop as an opportunity for full-fledgedfood security.

Food Security sans PDS: Universalisation through Targeting?


The Congress-led United ProgressiveAlliance faced perhaps the biggest crisis ofits second term at the Centre with theOpposition gridlock during the WinterSession of Parliament over the 2GSpectrum scam, which snowballed afterthe publication of the Comptroller andAuditor General of India (CAG)’s auditreport tabled in mid-November 2010. TheUPA government’s track record of late hasbeen rather dismal what with allegationsof massive corruption surrounding therecent Commonwealth Games in Delhiand it facing brickbats over the inability tocontrol food inflation (as onion prices hitthe roof)! It has also allegedly failed todistribute the reserves of foodgrains,apparently rotting in FCI godowns, to theswelling population of malnourishedchildren and adults.

This issue of Budget and Policy Trackingscans certain significant policy relateddevelopments and important legislationsduring the Winter Session. Apart frombriefly discussing some of the bills passedin this session, the article highlights keymacroeconomic issues as well as someissues related to governance andaccountability. The article begins withsummarising the bills passed and pendingin Parliament during Winter Session2010, moves on to examining a few billsrelated to the social sector in detail, andfinally deliberates on policy issues andresponses related to governance andaccountability.

I. Bills Passed and Pending inParliament during Winter Session2010The Winter Session commenced onNovember 9 and ended on December 13without transacting any substantialamount of business. It will probably godown in history as the only session ofParliament to be “washed out” owing tothe logjam over the demand for a JointParliamentary Committee (JPC) probeinto the 2G scam.

The Manmohan Singh government hadplanned to introduce 24 new bills andwithdraw 3 bills1 but with only 24 sittings,eight new bills were listed for introduction,consideration and passage. As many as 23bills remained pending for considerationand passage.

II. Bills Related to the Social Sector:1. The Foreign Educational Institutions(Regulation of Entry and Operations)Bill2

The Foreign Educational Institutions(Regulation of Entry and Operations) Bill,introduced in the Lok Sabha on May 3,2010 by the Ministry of Human ResourceDevelopment, is a crucial legislationrelating to higher education. It seeks toregulate the entry and operation offoreign educational institutions seeking toimpart higher education, includingtechnical and medical education, andaward of degrees and diplomas. Some

possible benefits, as argued by the HRDMinistry are participation of globallyrenowned universities, skill development,increasing access to innovative areas ofstudies, and increase in the GrossEnrolment Ratio. The key provisions ofthe bill include:● Every foreign educational institution

intending to operate in India has tobe notified as a foreign educationalprovider by the Central governmenton the recommendation of theRegistrar (Secretary, UniversityGrants Commission) in theprescribed manner.

● A “foreign educational institution” isdefined as any institution establishedoutside India, which has been offeringeducational services for a minimumof 20 years and proposes to offercourses to be taught throughconventional teaching methodexcluding distant education.

Budget and Policy TrackingRia Sinha

Parliament in Winter Session 2010

● Bills PendingThe Educational Tribunals Bill, 2010The Right of Children to Free and Compulsory Education Bill, 2010The National Council for Teacher Education (Amendment) Bill, 2010The Foreign Educational Institutions (Regulation of Entry and Operations)Bill, 2010 etc.● New Bills Listed for Introduction, Consideration and PassageThe Companies Bill, 2010The Judicial Standards and Accountability Bill, 2010The Juvenile Justice (Care and Protection of Children) Bill, 2010The Land Acquisition (Amendment) Bill, 2010The Rehabilitation and Resettlement Bill, 2010 etc.● Bills Listed for IntroductionThe Consumer Protection (Amendment) Bill, 2010The National Council for Higher Education & Research Bill, 2010The National Identification Authority of India Bill, 2010The Protection of Women from Sexual Harassment at Workplace Bill, 2010 etc.● Bills Listed for WithdrawalThe Enemy Property Bill, 2010The Administrative Tribunal (Amendment) Bill, 2010The Labour Laws Amendment and Miscellaneous Provisions Bill, 2006

Source: PRS Legislative Research Website


● The programme of study offered bythe foreign educational provider hasto conform to standards laid downby the statutory authority such asUniversity Grant Commission(UGC), All India Council ofTechnical Education (AICTE),Medical Council of India (MCI) andthe quality in terms of curriculum,methods of teaching and faculty iscomparable to that offered tostudents in the main campus.

● The bill requires foreign educationalinstitutions to maintain a corpusfund of a minimum of Rs.50 crore. Amaximum of 75 percent of anyincome generated from the fundshould be utilised for developing itsinstitution in India while the restshould be put back in the fund. Therevenue thus generated cannot beinvested for any purpose other thandevelopment of the educationalinstitution in India. The Centralgovernment may exempt anyinstitution from conforming to therequirements of the Bill except thepenalty provision and the revenueprovision.

● It provides for withdrawal ofrecognition if any foreign educationalprovider violates the provisions.

● The bill also lays down norms for theforeign educational institutionsconducting certificate courses.

The bill in its current form has invitedmuch criticism. Some protagonists arguethat foreign institutions should havelimited entry as long as apprehensions overquality of education provided, type ofsubjects that would be taught, andpossibility of faculty moving from Indianinstitutions are addressed. However,others see it as a step towards furthercommercialisation of higher education,and the gradual withdrawal of thegovernment from this sector. This wouldinvariably result in widening the gapbetween the rich and poor in terms ofaccess to quality education.

2. Protection of Women from SexualHarassment at Workplace Bill3

The Union Cabinet approved theintroduction of the Protection of Women

against Sexual Harassment at WorkplaceBill on 7th December 2010. The proposedbill seeks to ensure a safe environment forwomen at workplaces, both in public andprivate sectors whether organised orunorganised. In the context of the growingviolence against women, this bill assumesspecial significance. It will be theresponsibility of the Centre to implementthe bill through its undertakings/establishments and of the stategovernment concerned with regard toevery workplace established, owned,controlled or wholly or substantiallyfinanced by it, as well as of private sectorestablishments falling within theirterritory.

Key features:● The bill proposes a definition of

sexual harassment, as laid down bythe Supreme Court. It recognises thepromise or threat to a woman’semployment prospects or creation ofhostile work environment as “sexualharassment” at workplace, andexpressly seeks to prohibit such acts.

● The bill provides protection not onlyto women who are employed but alsoto any woman who enters theworkplace as a client, customer,apprentice, daily wageworker or in anad-hoc capacity. Students, researchscholars in colleges/universities andpatients in hospitals too fall under itspurview. The bill also coversworkplaces in the unorganisedsectors.

● It provides for an effective complaintsand redressal mechanism. Under theproposed bill, every employer isrequired to constitute an InternalComplaints Committee.

● Employers who fail to comply withthe provisions of the proposed billwill be punishable with a fine whichmay extend up to Rs. 50,000.

● Since there is a possibility that duringthe pendency of the inquiry, thewoman may be subject to threat andaggression, she has been given theoption to seek interim relief in theform of transfer either of her own orthe respondent or seek leave fromwork.

● The Complaint Committees arerequired to complete the enquirywithin 90 days and a period of 60days has been given to the employer/district officer for implementation ofthe recommendations of theCommittee.

● The bill provides for safeguards incase of false or malicious complaintsof sexual harassment. However, mereinability to substantiate the complaintor provide adequate proof would notmake the complainant liable forpunishment.

Despite being an extremely progressive steptowards providing a secure workenvironment to women, certain concernsremain.4 The provision relating to theliability of punishment for those womenunable to substantiate their complaints isquite erroneous. Another glaring omissionis the exclusion of domestic workers inIndia from its purview.

III. Policy Responses and Issuesrelated to Governance andAccountability1. Right to Food Bill:The UPA government’s proposedlegislation on Food Security, the draft ofwhich was cleared in the first first quarterof 2010, promises to address the problemof millions of people living below thepoverty line (BPL) through subsidisedgrains for the poor. Under the foodsecurity act, every poor family would get25 kg of foodgrains per month at Rs.3 perkg.

In response to the draft bill, the SupremeCourt of India had ordered increase inthe scale of issue of foodgrains per familyper month to 35 kg from 25 kg, which wasnot taken into consideration by theEmpowered Group of Ministers (EGoM)set up on July 12, 2009 to examinevarious issues relating to the proposed law.The draft bill, prepared by theDepartment of Food and PublicDistribution, has been referred to theLegislative Department of the Ministry ofLaw and Justice.



Under the new law, the range of food andnutrition related schemes that arecurrently operational will be merged. Atpresent, the government provides 277 lakhtonnes of foodgrains for below povertyline (BPL) and Antodaya Anna Yojana(AAY) categories, with a subsidyamounting to Rs. 37,000 crore. Underthe new act, the government will provide251 lakh tonnes of foodgrains for BPLand AAY categories, with subsidyamounting to Rs. 40,380 crore (if 25 kgof rice or wheat per month is supplied toeach BPL household at Rs 3 per kg).Computerisation of the Targeted PublicDistribution System (TPDS) will takeplace along with the setting up of villagegrain banks and food security tribunals5.At a time when prices of food items andother cereals have spiralled out of thereach of the common people, thesignificance of a bill of this nature cannotbe overstated. However, the draft bill’sapproach to the notion of food securityremains a subject of intense debate.

For many academics and activists, theproposed bill excludes a large section ofthe population by targeting only thoseselected as living below the poverty line inIndia. They argue that the bill does notaddress the nutritional needs of the peopleand overlooks the high rates of childmalnutrition in the country. It completelyignores the multiple entitlements whichconstitute the right to food of all ages ofpeople and all sections of society includingvulnerable groups. Eminent developmenteconomist Jean Dreze6 states that theproposed bill remains extremelyinconsistent and inadequate. Contrary topopular understanding, the bill is not aradical departure from the present foodpolicies of the government. Dreze alsoraises serious doubts about theeffectiveness of the current PDS.According to him, a targeted PDS isineffective as it is very difficult to identifyBPL families and vouches foruniversalisation of the current PDS.

The EGOM on food security, headed byUnion Finance Minister PranabMukherjee, has held meetings on issuespertaining to identification of BPL families

in consultation with the PlanningCommission, the Ministry of RuralDevelopment for rural areas and theHousing and Poverty Alleviation Ministryfor urban areas7. The draft bill howeverdoes not have any provision for AbovePoverty Line (APL) families.

Universalising PDS will be critical forensuring the well-being of the masses.Some have raised concerns regarding thecost implications of universalising PDS butan elementary cost calculation of the samesuggests otherwise. Universalising PDSwould entail cost estimations beyond theexisting practice of food subsidy in thebudgets. A CBGA study estimates that anadditional Rs. 88,563 crore would berequired to supplement the presentprovisions of food subsidy in the countryto ensure food for all. This cost estimationis based on the following assumptions:● Total number of households at

present is 23.96 crore (approx 24crore) based on size of household as4.8 (as reported in NFHS-3) withprojected population of the countryat present at 115 crore.

● Extending provision of PDS to allhouseholds would require subsidisedfoodgrains at 35 kg per month perhousehold at CIP of Rs.3 per kg.

● The minimum support price (MSP)as well as Economic Costs of wheatand rice do not increase from what itis at present i.e., Rs.1, 893.7 perquintal of rice and Rs. 1,402.5 perquintal of wheat.

● Distribution of rice and wheat is inthe ratio of 2:1

The study underscores the need forincreasing budgetary allocation towardsfood subsidy. Merely targeting the poorestof the poor instead of universalising PDSreflects a lack of political will of thegovernment to keep its promise to feed thehungry.

Despite rapid economic growth andvarious government programmes over thepast two decades, India’s malnutritionfigures are not coming down. In fact, theranks of the hungry seem to be growing.Experts in the field have time and again

suggested revamping of the publicdistribution system and greater publicinvestment in the rural economy toaddress the basic needs of the population.Various studies have shown that foodinsecurity is very high in the rural areas,more so in the backward states. Self-sufficiency may have increased at thenational level but even in the relativelywell-off states, this has not percolateddown to the household level.

At present, the proposed right to foodlegislation has gone back to the drawingboard, with the government consideringwidening the ambit of the PDS. As andwhen such a law does come to pass, thegovernment must bring about PDSreforms and broaden the network of fairprice shops across the country to ensurethat the principles of transparency andaccountability work at every level.

2. Lack of Effective Governance: The 2GSpectrum ScamThe reputation of the UPA governmenttook a serious beating during the WinterSession with allegations of widespreadcorruption pertaining to theCommonwealth Games, followed by theAdarsh Housing society scam in Mumbaiand finally the Second Generation (2G)Spectrum exposé. The 2G Spectrum tapsthe airwaves providing second generationwireless telephone technology. This is ascarce asset, whose license should beprovided in a judicious manner withproper valuation. However, licenses wereissued at very cheap rates which created ahuge economic burden on the nationalexchequer. This led to the resignation ofthe IT and Communications Minister A.Raja, with CAG holding him personallyresponsible for the sale of 2G Spectrumlicences at rates that “appeared far belowwhat has been perceived to be theappropriate market price in 2008”,resulting in a loss of up to Rs 1.70 lakhcrore to the national exchequer.

An audit was conducted by CAG duringJanuary 2010 to September 2010 coveringthe period from 2003-04 to 2009-108. Itcovered the implementation of policy forUnified Access Licensing Regime and




allocation procedure for 2G Spectrum tonew as well as existing operators under theUnified Access Services (UAS). TheUnified Access Licensing Regime endorsedby the Union Cabinet for fixed line andmobile telephone services in November2003, had faced huge criticism by thecellular operators. Under the new regime,service providers are allowed to offer bothmobile and fixed services under one licenseafter paying the additional entry fee. Thishad restricted the scope to fixed andmobile services, thereby excluding nationaland international long distance services.The major responsibility of the telecomdepartment is to regulate the issue oflicenses in a fair and judicious mannerunder the new scheme.

The basic objective of the CAG audit wasto ascertain whether the policy for issue oflicense under UAS was implementedefficiently along with fair and transparentallocation of radio frequency spectrumand whether the telecom sector wascapable of generating a sufficient amountof revenue for the government.

Findings of the CAG Report:● Implementation of UAS licensing

regime was to be carried out in twophases with the first phase of sixmonths assigned for migration ofalready existing Basic ServiceOperators (BSOs) and CellularMobile Service Operators (CMSOs)to the new regime. The audit revealedthat the Department of Telecom(DoT) did not implement thelicensing regime as approved by theCabinet, implementing only the firstphase and overlooking the second.Hence, it was extremely erroneous tovalue the spectrum in 2008 at 2001prices that was based on a totallynascent market despite the sectorwitnessing substantial transformationand manifold growth, since then.

● Scrutiny of records indicated that theHigh Powered Telecom Commission,which also includes members fromthe Union Ministries of Finance,Industry, IT and the PlanningCommission, was not consulted todeliberate on the merits of the

Telecom Regulatory Authority ofIndia (TRAI) recommendations or atthe time of grant of 122 UAS licensesin 2008.

● The views and concerns of theFinance Ministry regarding the issueof spectrum pricing was stronglyoverruled.

● DoT had previously requested theMinistry of Law and Justice tocommunicate the opinion of theAttorney General/Solicitor Generalof India to enable it to handle anunprecedented rush of applicationsin a fair and equitable manner. TheMinistry had in turn stressed onsetting up of an EGoM but DoTtotally ignored those suggestions.

● The recommendations andsuggestions of the Prime Ministerregarding the unprecedented numberof applications received for freshlicenses and spectrum pricing througha fair and transparent method ofauction for revision of entry fee werealso not followed.

● DoT deviated from the First ComeFirst Served (FCFS) policy previouslyadopted for allocation of spectrumextended for issue of new UASlicenses.

● Apart from these inconsistencies, theprocess followed by DoT forverification of applications for UASlicenses for confirming their eligibilitylacked fairness and transparency,thereby leading to grant of licenses toapplicants who were not eligible.

The financial impact of this scam wasenormous. TRAI in August 2007, whilerecommending that 2G Spectrum shouldnot be auctioned opined that “in today’sdynamism and unprecedented growth oftelecom sector, the entry fee determined in2001 is also not the realistic price forobtaining a license. Perhaps it needs to bereassessed through a market mechanism”9.In fact, there are varied determinants likescarcity value, the nature of competition,business plans envisaged, time of entry,purchasing power of the people, growth ofthe economy etc. which together alongwith market forces determine the value ofthe spectrum. As a consequence, the 2G

Spectrum was grossly underpriced. Whilethe government made a huge profit fromauctioning of the 3G Spectrum, it suffereda gigantic loss of nearly Rs. 1.70 lakh croredue to undervaluation of the2Gspectrum.

3. Introduction of Budget Manual byMinistry of FinanceRecognising the fact that the UnionBudget is a voluminous document whichpeople often find difficult to comprehend,the Government of India has for the veryfirst time brought out a Budget Manual toserve as a “crucial tool for Public FinanceManagement”10. It is a comprehensivedocument which captures the content ofthe Union Budget as well as theprocedures and activities connected withits preparation. Budget, being a verycomplicated issue, the processes andguidelines have been simplified and put ina logical sequence for easy comprehension.

The manual, prepared by the BudgetDivision of the Department of EconomicAffairs, disentangles the detailed processesinvolved in the entire process of budgetpreparation. It is also expected to bringabout greater transparency and betterunderstanding about procedures andsystems relating to making of UnionBudget. It is expected to provide deeperunderstanding to the officials ofministries/departments of their roles andresponsibilities with respect to preparationof documents and statements included inthe budget. It is also expected to serve as aguidebook for uniform administration ofbudgeting procedures and practices in theUnion government, including the lineministries and departments.

The manual gives a lucid definition of theterm ‘Budget’ and its scope. It explains theimportance of government budget in theoptimal allocation of the scarce resourcestaking into consideration the socio-economic objectives of any government. Itassists the government in predeterminingits fiscal policies in sync with the variousdevelopment goals. Hence, it provides aguideline both for the present and thefuture.



The manual mentions the importantconstitutional provisions such as theAnnual Financial Statement,Appropriation Bills, Supplementary,Additional or Excess Grants,Consolidated and Contingency Fund, therole of the Finance Commission, AuditReports, and Money Bills related to theUnion Budget. It explains variousorganisational aspects such as the rolesand responsibilities of the Executive andthe Legislature in the budget preparationand presentation, the significant role ofthe Parliament (both the Lok Sabha andthe Rajya Sabha), the processes of Budgetpresentation, the presentation of theDetailed Demand for Grants etc., thedifferent types of cut motions to reducethe number of demands on any particulartopic.

It also deals with expenditure issuesgoverned by the Department ofExpenditure. The role of the departmentis to create a more pro-active and positiveinterface between the Finance Ministryand the other ministries/agencies of thegovernment. The different divisions of thedepartment such as the plan financedivisions have been entrusted withdifferent responsibilities related to thebudget making processes.

The Budget Manual also explains thecrucial role of the Planning Commissionin the budgetary processes and the publicfinances of the country. The PlanningCommission, besides formulating andmonitoring development plans, advises theUnion government on the desirabletransfer of resources to the states, essentialfor development outlays. Banking beingthe core sector of financial development,the manual explains the pivotal role andresponsibilities of the Reserve Bank ofIndia in controlling the economy.

The most intricate chapter in the manualis the budget making process related tobudget preparation, budget circular,responsibilities of budget division etc. Itstates the critical responsibilities of thedepartments concerned in the budget-making process and in maintaining thesecrecy of the budget documents. It

explains the several documents related tothe prepared budget such as Key to Budgetdocuments, Budget Highlight, BudgetSpeech, Budget at a Glance, AnnualFinancial Statement, Finance Bill, Receiptand Expenditure Budget etc. BudgetReporting and evaluation forms anintegral part of the budget manual. It alsoexplains the key documents – the mediumterm fiscal policy statement, fiscal policystrategy statement and the macroeconomicframework statement, which arecustomarily laid down before both housesof Parliament.

4. Reforms in the Taxation Sector(Direct Taxes)As part of its ongoing tax reforms aimedat making the taxation regime moretransparent and predictable, thegovernment is slated to roll out the newDirect Taxes Code (DTC) by April 2012.The new Code, which was initially releasedby the Finance Minister in August 2009and subsequently, with some revisions inJune 2010, envisages far-reaching changesin the tax system. The chief proposal in theDTC is to increase the governmentrevenue through better tax complianceand plugging of tax leakages. Manychanges have been proposed relating toincome tax and corporate tax rates, withthe latter expected to be brought downfurther. Several reforms have beenproposed with regard to increasing theeffectiveness of the tax administration andCAG has conducted an audit on theperformance of “The Appeal Process” ofthe Tax Department11.

The main objective of this audit was toenable the department to contain theinventory of appeals to a manageable levelby rationalising the workload of its officersat different levels, thereby enabling speedyresolution of tax disputes. It has beenuniversally accepted that litigation is notonly costly and time consuming but alsodestructive of cooperative relationshipsbetween the tax department and thetaxpayer.

Some of the major observations made inthe CAG report are:

● Appeals pending at the end of theyear are increasing over time. In fact,the average time taken by thedepartment to dispose appeals hasbeen quite high in India (14 months)compared to other countries. It hasrecommended that small taxpayers’disputes be settled by the departmentseparately through an alternatedispute resolution mechanism andstrict administrative measures, takenup wherever necessary. This wouldspeed up the process of dissolution ofdisputes.

● As recommended by the Vijay KelkarCommittee, the department shouldrelease annual information on theperformance of officers as aconfidence building measure.

● Another issue addressed by the auditwas the level of satisfaction providedto the taxpayers and the departmentat various levels of appeals. The auditused a satisfaction index as aparameter to evaluate theachievement of this goal. It was foundthat overall success rate achieved bythe department at various levels ofappeals was low and appealsdecidedly went in favour of thetaxpayers. On the issue of effectivenessof internal controls, the auditrecommended that a system forperiodic reconciliation of data beinstituted along with timely collectionof appellate orders to stem the delaysin implementation processes.

5. Mid-Term Appraisal of the EleventhFive Year Plan and Inclusion of CivilSociety in Preparation of the 12th PlanThe Mid-Term Appraisal (MTA) of theEleventh Five Year Plan12 reviews theexperience in the first three years of thePlan period and seeks to identify areaswhere corrective steps may be needed. Itdeals with the various macro issues relatedto industry, agriculture and governance aswell as issues related to the social sectorslike education, health, social justice, specialarea programmes and rural development.Infrastructure related to energy, transport,telecommunications etc. have also beenreviewed and emphasis laid on sectors such




as science and technology, water resources,environment and forests.

The Eleventh Plan had aimed at anaverage growth rate of 9 percent perannum, beginning with 8.5 percent growthin the first year and accelerating to 10percent in the last year. Though theeconomy exceeded expectations in the firstyear of the Plan (2007-08) with a growthrate of over 9 per cent, the momentumwas interrupted in 2008-09 by the globaleconomic recession. Thereafter, thegovernment took several fiscal andmonetary measures to revive the economy.The agriculture sector suffered a setbackdue to drought conditions which had aninflationary impact on the prices offoodgrains. MTA particularly stresses onthe resilient nature of the Indian economy,pointing to the relatively modest slowdownduring the recessionary period despite theexceptionally sharp contraction in outputin the developed economies. One of theprimary reasons for this may be the lessdependence on exports as compared toother economies. Second, the level ofprivate savings has been high and fiscalconsolidation in previous years hasimproved the public savings performance.As a result, the domestic savings rate that

had increased to 36.4 percent of GDP in2007-08 declined to 32.5 percent in2008-09 because of the adverse effect ofthe crisis on tax revenues coupled with thefiscal stimulus. Despite the crisis, FDIflows (which exclude FII inflows) havebeen quite good and the estimated FDIinflow in 2009-10 was Rs.1,206 billion

However, MTA found weaknesses ininfrastructure, particularly in the energyand transport sectors, which have in themedium term been the most importantconstraints in terms of growth of theeconomy. The first three years of the Planwitnessed a commendable increase in thetotal investment in infrastructure.Railways steadily expanded freight andpassenger business, but a lot more needs tobe done, it noted. It also found that lackof proper governance to be a majorconstraint in implementation of variousgovernment schemes and programmes.

The Appraisal has also thrown up certainissues for future consideration that includesthe management of scarce resources such aswater, issues related to integrated energypolicy, changes in climate which result inserious adverse consequences in differentparts of the world.

The Twelfth Five Year Plan is slated tocommence in 2012-13. Generally, beforethe plan targets are set, the PlanningCommission prepares an Approach Paperwhich lays out the major targets, the keychallenges in meeting them, and the broadapproach that must be followed to achievethe stated objectives.

In a move towards a more inclusive andparticipative approach, the Commissionhas now decided that the Approach Paperwill be evolved through a consultativeprocess in which civil society can alsoparticipate.13 The goal of the ApproachPaper14 is to achieve faster, sustainable andmore inclusive growth. Macroeconomicindicators like GDP growth, savings,investment, balance of payments, resourcesand a sustainable environment thataddress the issues of climate change,energy, water, land and forest resourceswill play a critical role. The contributionsto the Approach Paper were invitedthrough the website of the PlanningCommission(www.planningcommission.gov.in) as wellas the formal processes of holdingconsultations with civil society groups,think-tanks and NGO activists.

1 Parliament Session Alert, Winter Session: November 09-December 13, PRS Legislative Research, 2010.2 The Foreign Educational Institutions (Regulation of Entry and Operations) Bill, PRS Legislative Research, 2010.3 The Protection of Women against sexual harassment at workplace Bill, 2007, available at http://wcd.nic.in/protshbill2007.htm.4 Cited by Farah Naqvi, Hindusthan Times, available at http://www.hindustantimes.com/The-last-to-know/H1-Article1-630108.aspx.5 D.O.No.8-27/2009-BP-III, Concept Note, Government of India, Ministry of Consumer Affairs, Food and Public Distribution, Department of Food and Public Distribution, 4th June, 2009.6 ‘The middle class has lost track of how poor this country is’, Tehelka Magazine, Vol 7, Issue 44, Dated November 06, 2010. Retrieved on December 1, 2010 from file:///H:/Budget%20Track/Right%20to%20Food/Tehelka%20%20India’s%20 Independent%20Weekly%20News%20Magazine.htm.7 Note for Empowered Group Of Ministers (EGOM), No.11-12/2009-IC/NFSA, Government of India, Ministry of Consumer Affairs, Food and Public Distribution, Department of Food andPublic Distribution.8 Comptroller and Auditor General of India, Report No. 19-Performance Audit of Issue of Licenses and Allocation of 2G Spectrum, Department of Telecommunications, Ministry ofCommunications and Information Technology, available at www.cag.gov.in.9 Comptroller and Auditor General of India, Report No. 19-Performance Audit of Issue of Licenses and Allocation of 2G Spectrum, Department of Telecommunications, Ministry ofCommunications and Information Technology, Financial Impact, page no. 51.10 Govt. of India, Budget Manual, Ministry of Finance, Department of Economic Affairs, Budget Division, New Delhi, 2010.11 Comptroller and Auditor General of India, Report No. 20- Performance Audit of The Appeal Process, available at www.cag.gov.in.12 Govt. of India, Mid Term Appraisal for Eleventh Five Year Plan 2007-2012, Planning Commission, New Delhi.13 Decision taken at a workshop on 19th June, 2010, under the Chairmanship of Dr. Montek Singh Ahluwalia.14 Approach to the Twelfth Five Year Plan, Planning Commission, Govt. of India.



Budgetary Investments towards Food Subsidies in India – A Factsheet

Table 1: Total Subsidy given in the Union Budget since 2004-05 (in Rs. Crore)

Items/Year 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 RE 2010-11 BE

A- Major Subsidies 44753 44480 53495 67498 123581 124786 109092

Food Subsidy 25798 23077 24014 31328 43751 56002 55578

Indigenous (Urea) Subsidies 10243 10653 12650 12950 17696 14080 15981

Imported (Urea) Subsidies 494 1211 3274 6606 10079 3948 5500

Sale of decontrolled fertilizer 5142 6596 10298 12934 48555 34952 28500with concession to farmers

Total Fertiliser Subsidy 15879 18460 26222 32490 76330 52980 49981

Petroleum Subsidy 2956 2683 2699 2820 2852 14954 3108

Grants to NAFED for MIS/PPS 120 260 560 860 375 850 425

Other Subsidies 1204 3042 3630 3428 6127 6239 7132

Import/Export of sugar, 0 0 0 0 0 0 0Edible Oils etc

Interest Subsidies 564 2177 2809 2311 3493 2719 4416

Other Subsidies 640 865 821 1117 2634 3520 2716

Total Subsidies 45957 47522 57125 70926 129708 131025 116224

Total Union Govt. Expenditure 498252 505738 583387 712679 883956 1021547 1108749

GDP at Market Price 3239224 3706473 4283979 4947857 5574449 6164178 6934700

Total Subsidies as 1.42 1.28 1.33 1.43 2.33 2.13 1.68proportion to GDP (%)

Total Subsidies as Proportion to 9.22 9.40 9.79 9.95 14.67 12.83 10.48Total Union Govt. GovernmentExpenditure (%)

Note: RE-Revised Estimate, BE-Budget EstimateSource: Compiled by Centre for Budget and Governance Accountability from Expenditure Budget Volume I, Union Budget 2010-2011.

Climate Change: External and Internal Realities for IndiaBudget and Policy Tracking


Table 2: Combined Expenditure on Food Subsidy (Explicit) in India (in Rs. Crore)

Year Subsidy to Food Subsidy by the Total Food Subsidy Total Food Subsidy Total Food SubsidyFCI (Rs. in Cr.) States (Rs. In Cr.) (Rs. In Cr.) as % of Total as % of

Combined Expenditure GDP

1990-91 2450 42 2492 1.6 0.4

1995-96 5377 338 5715 1.9 0.5

1996-97 6066 355 6421 2.0 0.5

1997-98 7500 408 7908 2.1 0.5

1998-99 8700 309 9009 2.0 0.5

1999-2000 9435 512 9947 1.9 0.5

2000-01 12060 493 12553 2.3 0.6

2001-02 17499 403 17902 2.9 0.8

2002-03 24176 618 24794 3.7 1.0

2003-04 25160 753 25913 3.4 0.9

2004-05 23280 1199 24479 3.0 0.8

2005-06 23077 1163 24240 2.6 0.7

2006-07 24014 1120 25134 2.3 0.6

2007-08 31328 1380 32708 2.6 0.7

2008-09 RE 43627 1979 45606 2.9 0.8

2009-10 BE 52490 2598 55088 3.1 0.9

2010-11 BE 55578 NA 55578 NA NA

Notes: RE-Revised Estimate, BE-Budget Estimate, NA-Not AvailableThis includes budgetary expenditure by Centre and States.

Source: Compiled by Centre for Budget and Governance Accountability from Expenditure Budget Vol.-I, 2010-11 and Budget At a Glance, 2010-11,GoI; Indian Public Finance Statistics, Ministry of Finance, GoI, Various years; Economic Survey, 2009-10.


Prepared by: Nilachala Acharya

Budgetary Investments towards Food Subsidies in India – A Factsheet


Climate Change: External and Internal Realities for IndiaBudget and Policy Tracking

in this issue - cbgaindia.org visiting fellow to several foreign universities, he has written...

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