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Global Food Crisis:DON’T PASS THE BUCK, MR. BUSH , by Radhakrishna Rao Print E-mail

Events & Issues

New Delhi, 6 May 2008

Global Food Crisis

DON’T PASS THE BUCK, MR. BUSH 

By Radhakrishna Rao

The US President George W. Bush’s recent observation that the growing prosperity of an upwardly mobile Indian middle class is to blame for the global food crisis appears far-fetched and totally in variance with the prevailing ground reality.

 “Worldwide there is an increasing demand for food. There turns out to be prosperity in developing world which is good. It is going to be good for you because you will be selling products in the countries, you know, big countries perhaps, and it is hard to sell products into countries that  are not prosperous…It, also,  however increases the demand”,  was Bush’ words of wisdom.

He elaborated saying “So for example, just as an interesting thought for you, there are 350-million people in India who are classified as middle class. That is bigger than America.  Their middle class is larger than our entire population .And when you start getting wealth, you start demanding better nutrition and better food and so demand is high and that causes prices to go up”. Of course, Bush also cited changes in climatic patterns and spiraling energy costs as some of the other contributors to the global food price spiral.

Prior to what is being termed as a highly objectionable statement by the head of the world’s largest economy, US Secretary of State Condoleeza Rice had created a near  controversy by saying that the global food price spiral was partly due to the growing intake of food in countries like India and China. The distorted thesis of Bush and  Rice  that the  severe food crisis haunting a large part of the world  was a direct outcome of measures taken by India and China to keep the foodgrains within  the confines of their countries by imposing severe export restrictions.

Right from the outset the Bush administration has been blaming “event and developments” outside its home country as the causative factors for problems haunting the US. The uncalled for bloody intervention in Iraq is but one of the many instances of the 21st century avatar of the so called “gun boat diplomacy” perfected by the Bush Administration.

Surprisingly, while throwing blame at the doorsteps of India and China for the current food crisis affecting a large section of the global population, Bush would not agree with the widely held view that the growing diversion of corn produced in the US for the production of ethanol as a fuel alternative was pushing up food prices. “I don’t subscribe to the notion that ethanol is the main cost driver. The reason why food prices are higher is, because, energy costs are high. And if you are a farmer you are going to pass on the cost in the product you sell to the buyers” quipped Bush.

However, food policy analysts from across the world  have been driving home the point that diversion of food crops for the production of eco- friendly and cost-efficient bio fuels is a major contributor to the foodgrains’ shortage experienced by the world at large. Similarly, there has been  a serious concern  over the diversion of prime farm land meant for growing food crops to raise oil yielding crops  .Against this backdrop, the competition between food and fuel  is likely to hit the developing countries much harder that the industrialised nations.

Rightly, Defence Minister A.K.Antony has described Bush’s hollow argument as a “cruel joke”. Antony was clear in his perception that the widespread conversion of agricultural land for commercial and bio-fuel cultivation purposes had, in fact, resulted in food shortage at the global level. ”Policies of the US have also been responsible for foodgrains shortage. Those who criticize should not set apart farm land for other purposes .The countries including the US should rectify these mistakes” he observed.

The argument put forth by Antony receives support from the recent FAO (Food and Agricultural Organisation) data which pins the blame on the US for the fast-spreading global food crisis. In fact, FAO data revealed in clear terms that the consumption of cereals is growing far more rapidly in the US than in India or China. A fact-filled study of the global food market by FAO states that the consumption of cereals by India is projected to have grown 2.17 per cent from 193.1-million tonnes in 2006-07 to 197.3- million tonnes in 2007-08, while that in neighbouring China it had gone up 1.8 per cent from 382.2-million tonnes to 389.1-million tonnes. More importantly, during the same period the consumption of cereals in the US has been projected to have grown 11.81 per cent from 277.6-million tonnes to 310.4-million tonnes.

Indeed, following the skyrocketing of oil prices in the global market, the US has been forced to use 30-million tonnes of corn to make bio-fuel. “About 30-million tonnes of corn was used in the US to produce biofuels last year,” observed Asia Director, International Food Policy Research Institute, Ashok Gulati. Though the demand for foodgrains in the Indian market has been going up, the situation has been made worse by serious supply constraints, he elaborated. ”Factors like the drought in Australia, diversion of corn to biofuel by the US and speculative investment in futures market globally have caused prices to flare” he said.

Meanwhile, UN Secretary General Ban-Ki-Moon has expressed his concern over the rising food prices causing a veritable “global crisis”. Commenting on the worldwide protests over the food prices’ spiral, Moon thus wanted the world leaders to mull on a strategy aimed at devising ways and means to enhance food security and improve food production and distribution system.

Back home, Minister of State for Power and Congress leader Jairam Ramesh has blamed the US-led developed world for diverting the precious crop land for biofuel production for the current food crisis. “George Bush has never been known for his knowledge of economics and he has just proved once again how comprehensively wrong he is. To say that the demand for food in India is causing global food crisis is completely wrong”, he said.

However, the ruling political elite in India has done precious little either to curb the inflation or to ensure food security for a large section of impoverished population. While the urban middle class with its growing purchasing power has been in a position to buy as much food as it needs, rural poor, landless farmers, daily wage earners and the socio-economically disadvantaged sections of the society are forced to make do with a decreasing intake of food. It is a grim ground reality that malnutrition and a sort of semi-starvation haunt a large segment of the Indian population. The callous and continuous neglect of the agricultural sector by successive ruling dispensations in New Delhi has contributed in a big way to the food crisis threatening the country’s growth.

While both the Prime Minister Manmohan Singh and Finance Minister P.Chidambaram are never tired of harping on an “impressive GDP(Gross Domestic Product)growth”, they have no answer as to how this achievement has  helped the poor and underprivileged  to lead a life without ”penury and suffering” .As things stand now, the fast spreading food  insecurity  that could breed violent street protests could become a major challenge for India’s ruling elite, whose concern at present appears to win the elections at any cost. ---INFA

(Copyright, India News and Feature Alliance)

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