- Nature of Food system in India
- Rising Food prices
- Impacts on Food Security
- Initiatives taken by government
Local food systems and COVID-19
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COVID-19 has created high transaction costs and uncertainty in India’s transformed food supply chains. The lockdown imposed has put food security at risk as 95% of food consumption in India is purchased, predominantly from the private sector.
Nature of Food system in India:
- There has been a deep and rapid transformation that has shifted the Food Supply chains (FSC) from being “traditional” to largely “transitional” in just two decades.
- This has made India one of the fastest changing agrifood economies in the world.
- The Indian food economy now is mainly urban, fed by long rural–urban supply chains.
- It is now 80% composed of non-foodgrains and thus fed by perishable FSCs like milk, fruits and vegetables, and fish and chicken.
- It is 85% dependent on small and medium sized enterprises (SMEs) that are dynamic, labour intensive and clustered near and in towns.
- The private sector sells 95% of all purchased food, while only 5% comes from the government via the public distribution system (PDS).
- Overall, the government plays a tiny direct role in national food security (in terms of distributing food).
- This implies a very limited capacity of the public sector to “replace” the private sector in supplying food to the Indian consumers.
Rising Food prices:
- The prices of key staples, barring cereals, have surged high because of a noticeable supply shock amid the three-week nationwide lockdown.
- As per the data from the Ministry of Consumer Affairs there are three main factors driving the food prices higher.
- One, arrivals of farm commodities in APMC markets have plunged sharply, down almost 60% in some markets compared to the first week of March.
- Two, land transportation costs have risen sharply, as truckers struggle to cross interstate boundaries, despite exemptions from the lockdown.
- Three, restrictions and quarantine measures have resulted in serious labour shortages, affecting the loading, unloading and sorting of commodities.
- On an aggregate basis, prices of cereals, such as wheat and rice, are steady, mainly because these are being adequately supplied from state-run granaries.
Impacts on Food Security:
- The worst part of the countrywide lockdown was that it coincided with the country’s peak harvesting time of a variety of crops of the season.
- The bumper harvest of wheat in the Northern part of India got impaired due to shortage of labour and transportation bottlenecks.
- Summer vegetables and fruits were ripened and ready to pick but lockdown has disrupted the procurement of perishable items.
- The farmers were forced to sell their produce for a lower price due to lack of storage facilities.
- Hindrance of transportation and fear of vigilant checks at state borders made it even difficult for the sales to happen.
- The poultry and meat industry was under immense loss due to the fake rumours of the association of COVID-19 and animals.
- Urban residents all over India found it difficult to buy groceries as the commodities became scarce in the beginning.
- The lockdown of the country resulted in panic buying and hoarding among the people.
- Retailers took advantage of the lockdown situation by imposing exorbitant prices on existing stocks.
- Black marketeers were on the rise that sold essential commodities at an outrageous price.
- The economists have warned that very soon the supply shocks could turn into demand shocks.
- Loss of income will lead to a drop in demand for food in the coming months.
- A possible decline in food consumption could result in malnutrition too.
Initiatives taken by government:
1. The Example of Kerala:
- Kerala, one of the first hit states in India by the COVID-19 outbreak was successful in setting an example for the rest of the country.
- Kerala’s government announced free ration for all for one month, meaning that the government will provide 35 kg rice for below poverty line families which constitutes 11.3 per cent of the total population in the state, and 15 kg of rice for others through the Public Distribution systems (PDS) and Kerala State Civil Supplies Corporation.
- The government initiated the distribution of food kits consisting of 17 essential items costing around INR 1000 from 8 April onwards for every household, irrespective of income status.
- It is distributed through the ration shops under the Public Distribution System.
- Pradhan Mantri Garib Kalyan Anna Yojana:
- The Finance Minister announced a 1.7 trillion rupees (USD 22.6 billion) relief package to take care of food security measures for the poor.
- The PM-GKAY would cover about 80 crore people in the country.
- The minister announced the distribution of free provision of 5kg of rice or wheat per person, 1 kg of pulse per household along with free cooking gas monthly for the next three months.
3. Other initiatives:
- The model of Kerala has been implemented across the majority of the states of India.
- The community kitchens have been set up all over the country to provide cooked food for the needy.
- Many NGOs and private institutions have come forward to provide food assistance and responsibility in distribution and logistics.
The Central government should establish clear mechanisms to monitor, implement and enforce the food distribution, procurement and emergency relief programmes. This requires coordination and collective action by all stakeholders involved. Finally, the government should make long-term investments to provide an integrated platform for mandis, producers, distributors and business clusters using advanced technology to ensure seamless flow of essential commodities year around under any situation.