AFTER months of heated arguments, intense intra-ministerial bickering and stiff resistance from bureaucrats and economists, the United Progressive Alliance government finally opted last week for a food security ordinance to launch its ambitious social welfare programme.

With less than a year for general elections, the Manmohan Singh government was under intense pressure from many within his Congress party to implement food security legislation, which would hopefully reinforce its pro-poor image. Congress has been battered over the past few years with charges of corruption, with many of its ministers and senior leaders having been forced to quit on grounds of malfeasance, even bribe-taking.

The next few months will see a busy election calendar. Initially, four key states — Delhi, Rajasthan, Madhya Pradesh and Chhattisgarh — will go to polls. Apart from general elections, the next year will also see elections in many big states, including Maharashtra and Andhra Pradesh.

The Congress leadership believes that the party had been voted back to power at the head of the UPA in 2009 following the rolling out of its landmark social welfare legislation, the National Rural Employment Guarantee Act. The National Advisory Council, a think-tank headed by favourites of Congress president Sonia Gandhi and which has been dubbed a super-cabinet by its critics, mooted the food security bill a few years ago.

However, Singh and many senior ministers, including the agriculture minister Sharad Pawar, and even finance minister P.

Chidambaram, were believed to have opposed the implementation of the scheme because of the huge costs involved.

But with the UPA government, and particularly the Congress, being targeted by anti-corruption activists and the opposition for a series of multi-billion-rupee scams that have surfaced in recent years, the party high command decided to introduce a watered down version of the bill before the general elections.

Many political observers believe that the Food Security Act could be a game-changer for Congress in next year’s elections, as it would endear itself to millions of poor and rural voters. In fact, the party was keen on steering the food security bill through parliament, but a wary Bharatiya Janata Party, aware of the consequences of the Congress claiming credit for the legislation, stone-walled it by virtually crippling parliament.

Then Congress decided last week to introduce the legislation through an ordinance, even though parliament is to convene for the monsoon session later this month. The National Food Security Bill would have had to be passed by both houses of parliament, but by opting for the ordinance route, Congress hopes to project itself as the party that is concerned about the welfare of the poor.

THE food security bill aims to provide about 62 million tonnes of rice, wheat and coarse cereals to nearly two-thirds of the population at highly subsidised rates. About three-quarters of the rural population and half of the urban folk will have the right to get five kilogrammes (kg) of food grains a month at subsidised rates of Rs3 a kg for rice, Rs2 for wheat, and Re1 for coarse grains.

Besides this, pregnant women and lactating mothers would get about Rs6,000 as maternity benefits, while children between six months and 14 years would get hot meals at home. The government claims that the programme will be the largest in the world, and cover 70 per cent of the country’s population.

However, the costs are also humungous, and threaten the delicate finances of the government. The new programme will result in the food subsidy bill ballooning to a massive Rs1.25 trillion (more than $20 billion), thus widening the fiscal deficit.

“While there is no denying the fact that the right to food and attaining proper nutrition should be the basic provision for every citizen, the announcement seems a little premature, and the country is yet not fully prepared to roll out such a programme,” says Dr A Didar Singh, secretary-general of the Federation of Indian Chambers of Commerce and Industry.

“One of the biggest issues that comes to the fore is of access. It is quite surprising that the government is willing to fall on the old Public Distribution System (PDS) to allocate food grains under the bill. The PDS has not been streamlined for years, and remains plagued with inefficiencies.”

Though governments have poured billions of rupees in subsidising food grains for the poor through the PDS over the past few decades, India is home to a quarter of the world’s hungry people. A recent survey revealed that more than 40 per cent of children below the age of five in the country are underweight.

Almost 40 per cent of the grains meant for distribution to the poor through the PDS is siphoned off by middle-men and corrupt officials.

And in a perverse incentive system, the government is pressurised by politicians to raise the minimum support price (MSP) paid to farmers, who continue producing wheat and rice irrespective of market demand or global supplies. Ironically, with the vast majority of the rural population covered under the food security bill, many of these farmers (as consumers) will now be eligible to get food grains at prices that are a fraction of what they get from the government under the MSP.

The high minimum support price has resulted in farmers dumping food grains at government warehouses. The result: over the past few years, grains have rotted outside these warehouses, especially during rains. State warehouses are also overflowing with grains, and selling more than 60 million tonnes at subsidised rates will not pose a problem now.

“At present, this can be a blessing in disguise, as there is a huge food grains stock with the government,” remarks Ashok Gulati, chairman of the Commission for Agriculture Costs and Prices. “But how far will it remain sustainable, unless we fix the PDS, stabilise production and invest in storage and transportation?”

UNFORTUNATELY, the UPA government and its advisors lay undue emphasis on the importance of food grains, while ignoring the need for better nutrition among the poor, who are increasingly allocating more funds from their meagre budgets to non-cereals.

The high minimum support price for cereals has resulted in farmers in affluent agricultural states, including Punjab and Haryana, focusing only on wheat, resulting in a drastic lowering of the groundwater table and degradation of the quality of the soil. And while India is self-sufficient in grains, it continues to import pulses.

The cereal-centric nature of the food bill ignores the reality that increasing numbers of both rural and urban households are spending less on food grains and more on higher value food including pulses, vegetables, milk, eggs, fish and meat.

The food security bill may also not have much of an impact in southern states, where many state governments distribute rice for free or as low as Re1 a kg to the poor. This is something the UPA’s new food security programme will not be able to match.

Tamil Nadu Chief Minister Jayalalithaa is a vociferous opponent of the bill. According to her, social welfare programmes should be under state domain, and the centre should not encroach on their rights by introducing such laws.

Alleging that the ordinance was ‘hoodwinking the poor,’ Jayalalitha — whose government has been providing free rice to the poor since 2011 — says that the UPA government introduced the ordinance in a bid to cover up the scams that have surfaced in recent months. By Anand Kumar