food security

THE NATIONAL FOOD SECURITY ACT (NFSA), 2013

A Step towards Nutritional Security

India will have a new ‘National Food Security Act, 2013’, implemented as a major initiative towards providing the food security to the people of the country as a legal entitlement. The objective of the act is “to provide for food and nutritional security in human cycle approach, by ensuring access to adequate quantity of quality food at affordable prices to people to live a life with dignity and for matters connected therewith”. The act enshrines freedom of right to food and nutrition from the current ‘welfare approach’ to a ‘rights based approach’. The law was passed by the Parliament in the monsoon session and has already received the assent of the Hon. President of India on 10th September, 2013. 

WHY A NEW LAW?

In spite of relatively higher GDP growth achieved during the neo-liberal policy regime, hunger and malnutrition among the majority of Indian population still persists. This has been made conspicuous by the data from National Family Health Survey (NFHS), which reveals that the percentage of aneamic married women in the age group of 15-49 has increased from 53.90 in 1998-99 to 58.20 2005-06 in rural areas and from 45.70 to 51.50 in urban areas. Similarly, percentage of aneamic children has also increased from 75.30 to 81.20 in rural areas and 70.80 to 71.70 in urban area between the same period.FSA2013

The International Food Policy Research Institute (IFPRI) 2013 report on hunger ranks India at 63 out of 120 countries and in Global Food Security Index 2013, India ranks 70 out of 107 countries.

The findings of HUNGaMA (Hunger and Malnutrition) survey report 2011, said that in 112 rural districts of India, 42 % of children under five are underweight and 59 % are stunted.

It is in this context the new law assumes significance as it focuses on ‘Food Security’ which according to FAO terminology has been defined as follows: “Food security exists when all people, at all times have physical, social and economic access to sufficient, safe and nutritious food which meets their dietary needs and food preferences for an active and healthy life’.

The law gives legal right to subsidized food grain to 67% of India’s population and marks a shift in approach to the problem of food security; from the current ‘welfare paradigm’ to a ‘rights-based approach’, thus entitling food to about two third of population at an affordable cost so as to ensure that all Indians “live a life with dignity”.

SALIENT FEATURES OF THE NEW LAW

1.      The act promises to cover 67% of the entire population of India within its ambit and this include 75% of the rural population and 50% of the urban household.

2.      Every person belonging to priority household* shall be entitled to receive 5 kg of food grains per person per month through Targeted Public Distribution System (TPDS) ** at subsidized prices of Rs 3 per kg for rice, Rs 2 per kg for wheat and Rs 1 per kg for coarse grains for a period of three years from the commencement of this act and there after such price as may be fixed by the Government of India from time to time.

*[Priority Households are those households which are left after deduction of beneficiaries to be covered under Antyodaya Anna Yojna (AAY) from all the ‘Eligible Households’ proposed to be covered by the Act or simply it can be formulated as: Priority Households = Eligible Households – Beneficiaries covered under AAY.] 

** [Targeted Public Distribution System (TPDS) was launched in June 1997, with its focus on " poor in all areas" envisages issue of 10 Kg of foodgrains per family per month for the population Below Poverty Line (BPL) at specially subsidized prices.]

3.      Poorest of the poor covered under Antyodaya Anna Yojna (AAY) would continue to receive 35 kg foodgrains per household per month.

4.      In case of non-supply of the entitled quantities of foodgrains or meals to entitled persons, such persons shall be eligible to receive Food Security Allowance from the concerned State Government.

5.      The act ensures that the Central and the State Governments shall endeavor to progressively undertake reforms in Targeted Public Distribution System through formulating and implementing fool proof arrangements for identification of poor, for delivery of foodgrains to Fair Price Shops (FPSs) and for its distribution in a transparent and accountable manner at the FPS level.

6.      There is a special focus on the nutritional support to women and children. Pregnant women and lactating mothers are entitled to nutritious meals free of charge during pregnancy and six months after the child birth, through the local anganwadi, so as to meet the nutritional standards. They will also receive maternity benefit of not less than Rs 6000, in such installments as may be prescribed by the Central Government. Children in the age group of 6 months to 14 years will be entitled to take home ration or hot cooked food as per prescribed nutritional norms.

7.      The act promotes women empowerment by proposing to make the eldest women who are not less than 18 years in every household for the issue of the ration cards for accessing benefits proposed under this Act.

8.      There is special focus on women, children and other special groups such as destitute, homeless, disaster and emergency affected persons and persons living in starvation.

9.      Provision of social audit and vigilance committees will be made to ensure accountability, transparency and quick redressal of grievances and thus paving way for setting up of State Food Commissions.

CONSTRAINTS

The NFSA 2013 has several supply side challenges, such as, identification of eligible households*, huge subsidy burden on the government exchequer, and volatility in food grains production and prices.

*[Eligible Households means summation of households covered under the priority households and under Antyodaya Anna Yojana (AAY).

As stated in the Act, the identification of eligible households should be done by ascertaining the percentage of coverage of rural and urban areas in each state under TPDS, households to be covered under AAY and thus determining the remaining households as priority households to be covered under TDPS, with such guidelines as the State Government may specify. For this the State Governments shall be given time period of not exceeding 365 days after the commencement of the Act, to identify eligible households as per guidelines given in the Act. ]

As per the government’s current procurement price, the subsidy burden on the exchequer is projected at whopping Rs 1.3 lacs crores per year and as such, the increase in subsidy burden would add to the current fiscal account deficit woes. In addition, significant rise in the number of beneficiaries and the need to keep raising the Minimum Support Price (MSP) to cover the rising cost of production and incentivizing the farmers to increase production of cereals, will keep on increasing current fiscal account deficit.

Implementation of NFSA 2013 will impose pressure on public finances and push up the fiscal deficit to 5% of the Gross Domestic Product and would make fiscal sustainability plan of the country difficult to achieve.

Procurement of rice, wheat and coarse cereals by the government of such huge quantities would result in less quantity available in the open market, there by pushing up food grain prices leading to inflationary pressures. This would further be aggravated by erratic monsoon in a particular year by escalating prices of the foodgrains.

The current system of distribution through five lacs fair price shops spread across the country suffers from logistical constraints involving sourcing, storage and onward transportation coupled with the leakage on account of pilferage, rotting and inefficiencies accounting for nearly 40%-50% of the total food stock. If this trend continues, the nation cannot afford the incremental losses on account of additional procurement envisaged in the act.

The act does not provide any agriculture and production related entitlements for farmers inspite of the fact that more than 60% of the people are dependent on agriculture. Without farmer security being an inbuilt mechanism in food security programme, the target may remain elusive.

According to WTO norms, implementation of the Food Security Act may come under market-distorting subsidy, as Government of India will be procuring foodgrains at higher Minimum Support Price (MSP) so as to incentivize more foodgrain production within the country and then selling at below market price to two-thirds of the country’s population.

In a Nutshell

Though the new law has its own share of policy shortcomings, yet it is definitely an effective policy instrument, or say, a game changer for national food security, if the government is able to:

-         Reduce economic cost of the foodgrains by making TPDS decentralized, efficient and transparent along with putting in place an effective and inclusive delivery system.

-         Farmers’ security be made an inbuilt mechanism as more the secure a farmer is; the more is the agriculture production which ultimately ensures food security for all. This can be expedited by hassle free and timely availability of credit and other financial inclusion services like agriculture insurance.

-         Suitable drought and pest resistant variety of seeds and farm inputs shall be made accessible to farmers along with access to sustainable irrigation practices. Value addition and food processing facilities need to be provided to raise farm income of small and marginal farmers.

-         Scientific grain storage and modern storage structures should be constructed in high production areas accompanied by an effective delivery mechanism to reduce pilferage of foodgrains. Reduce leakage, wastage through computerization and increased local participation.

-         Innovative technologies including smart cards and computerized records need to be made mandatory for an efficient, transparent and targeted intervention. Thus cash transfer aspect of the Act has to be carefully introduced; only after at least 90% of the beneficiaries have bank accounts and when there is end-to-end computerization.

The focused eradication of all the hassles will help in effective implementation of provisions given in the Act. It is only with the advancement of time that one can judge whether the Act was able to desirously deliver on the perceived benefits visualized at the time of enactment.


Posted by:

RAU'S IAS

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