WHEN UNION Agriculture Minister Sharad Pawar announced a bumper harvest last month, “the highest since 1947”, commodities markets perked up, sniffing food export opportunities. With a record 236 million tonnes of foodgrain produced in 2010-11, government godowns are bursting at the seams. Mountains of grain lie in the open, as stocks far exceed storage capacity. Into this picture of plentitude, Commerce Minister Anand Sharma introduces a note of caution, vis-à-vis exports: “We have to take into account the Food Security Bill, and keep in mind that world food prices have gone up 29 percent in 2010.” In taking a call on food exports, the million- tonne question exercising the minds of the Empowered Group of Ministers (EGOM) on food is the National Food Security Bill and the final shape it will take. Do we finally have enough food stocks to support a universal and statutory entitlement to food — or just enough to meet the shortfall in global demand? Pawar, a votary of food exports, ducked the question. The food ministry’s pitch for export of wheat, rice and milk products is based on apparent abundance at home and high food prices abroad, all of which adds up to a killing in the global market. Wheat and rice year-ending stocks are expected to stand at 30 million tonnes — double the mandatory reserve or ‘buffer norm’ of 16.2 million tonnes (plus 5 million tonnes of ‘strategic reserve’) that the government must maintain for the Public Distribution System (PDS) as on 1 April of every year. Sharad Pawar This may sound comfortable, as a mandarin observed, until one takes into account the demands of the proposed food security scheme. Even if the ambit is restricted to a targeted population, i.e., below poverty line households, the requirement may be as high as 71 million tonnes, according to a Planning Commission estimate (63 million tonnes for the PDS, 8 million tonnes for other welfare schemes). Last year’s procurement was around 47 million tonnes (22.5 million tonnes of wheat and 23.9 million tonnes of rice). In order to bridge this gap, the buffer stock would be all but wiped out in a couple of seasons. High global prices may call for even greater caution. India was, after all, a wheat exporter in the first five years of the millennium. It took just one bad harvest (2005-06) to turn it into a wheat importer — at a time when international wheat prices were surging. So tight was the wheat position that India even contemplated diluting phyto-sanitary standards to allow import of wheat of doubtful quality. The other worry is food inflation, yoyoing since the beginning of the year. And domestic prices have not eased, regardless of good harvests. Retail prices of rice are the same as last year’s and those of wheat are higher by 3.33 percent. Most disturbing of all is the fact that despite overflowing food stocks, per capita foodgrain availability continues to be among the lowest in the world. Foodgrain availability in 2009 was just 444 gm per day and in the previous year, an abysmal 434 gm per day — literally “aadha peth”. So how much of the ‘surplus’ is truly surplus, given that per capita foodgrain availability in India is less than half that of China and one-fifth that of the US? If per capita consumption was raised to a modest 500 gm per day — regarded as the minimum needed to sustain life — there would be a shortfall. Small wonder India ranks 67th on the World Hunger Index. THE GOVERNMENT is trying to present the proposed exports in the light of a one-off, to ease the pressure on storage facilities. Export of sugar has already been approved and there is a general clamour to lift the four-year ban on wheat (a million tonnes did get exported last year in the guise of ‘wheat products’). In a global wheat crunch scenario, with production estimates lower by 5.11 percent owing to a drought in China and a ban on exports from Russia, “world wheat prices are likely to stay positive in the medium term”. From the food ministry’s perspective, exports may be a better bet than having the wheat rot in godowns, attracting the ire of the Supreme Court. In the case of rice, basmati exports are allowed, subject to a minimum export price. The government now proposes to lift the ban on export of non-basmati or ‘common man’ varieties like Sugandha. Interestingly, the food ministry note admits “availability of rice for human consumption during the kharif season, 2010- 11, will fall marginally short of demand”. However, it goes on to say that it still expects to have more than double the rice buffer in stock by the end of the year. Predictions of a good monsoon have fuelled hopes of yet another bumper crop and enabled a sanguine approach to food stocks. As for milk products, export is justified on the grounds that the amount to be exported is a tiny fraction of the total production. At the same time, import of 45,000 tonnes of milk powder has been approved. Setting aside the peculiarities of trade policy, if the UPA is to live up to the promise made during the Budget speech, a National Food Security Act should be in place during this year. This means that the government will have to make every grain count.