Will India’s food security plan be a game changer?

For years, India has been near the top of the list for the number of malnourished children and near the bottom on a global hunger index. The government hopes to change that with its food security bill that envisages a 20-billion-dollar food security plan for 810 million people – about two-thirds of its 1.2 billion population. The bill was passed through an ordinance approved unanimously by the federal cabinet Wednesday and approved by President Pranab Mukherjee Friday.

“It will be a game changer,” Indian National Congress party spokesman Ajay Maken said. But critics raise a host of questions about the ability of the government to finance and implement the mammoth plan. Political opponents have flayed the ordinance, criticising the government for bypassing debate in parliament and describing it as a gimmick aimed at general elections scheduled for 2014. The National Food Security Bill was introduced in parliament in the winter session of 2011. It has not been passed to date and has some 70 suggested amendments pending for discussion, a fact that reportedly worried the president.

According to regulations, any ordinance such as the one on food security, needs the assent of parliament within six months. But given the populist nature of the programme, and the fact that the ordinance comes in the run-up to elections, opposition parties will find it difficult to oppose. On paper, the government’s plan is indeed revolutionary. It envisages distribution of 5 kilograms of foodgrains per month at highly subsidised prices of 3 rupees (0.05 dollars), 2 rupees and one rupee per kilogram for rice, wheat, coarse grains, respectively, to up to 75 percent of the rural population and up to 50 percent of the urban population.

It also has special provisions in cash and kind for pregnant women, lactating mothers and children. But how these will be distributed and where the funds will come from is what most critics have focused on, while others say that even in this reach it may exclude some of the poorest unless made universal. “We want to say we have considered all these issues before promulgating this ordinance,” Maken said at a joint briefing with Food Supplies Minister KV Thomas.

The Congress party leads Prime Minister Manmohan Singh’s ruling United Progressive Alliance (UPA). Maken said implementing the food security programme would cost the exchequer 1.2 trillion rupees, but the actual additional burden would be 238 billion rupees after excluding the current budgetary allocation and merging some current programmes.

Maken said the programme was not expected to impact the fiscal deficit, which currently stands at about 5.2 percent of gross domestic product. Critics say the effect on subsidies was likely to be evident in 2015. Some 61.2 million metric tonnes of foodgrains would be required and currently there are enough reserves in the government’s granaries with procurement at about 60.2 million metric tonnes over the past four years.

“We will increase it to 61.2, That is achievable,” Maken said. Thomas said storage facilities were being modernised and expanded at a rapid pace and had increased from 55 million tonnes in January 2011 to 78 million tonnes to date. State governments had been asked to identify beneficiaries and set up delivery mechanisms within six months. The bill provides for social audits, vigilance committees and penalty for non-compliance by officials in efforts to check corrupt practices.

But critics maintain that the government’s plan may well fail given the endemic and deep-rooted corruption of India’s public distribution system (PDS). The past few years have seen some improvement in the PDS system but recent assessments say as much as 40 percent of subsidised rice and wheat is still being pilfered and sold in the open market. A 2009 study that evaluated PDS, estimated that about 61 percent of the eligible population was excluded from the below poverty line list while 25 percent of those not eligible were included, according to New Delhi-based PRS Legislative Research.

“Beneficiaries under the Food Security Bill will be identified through a similar process,” the PRS blog says, adding that it was unclear how such errors in identification would be addressed. The bill also has a provision for a food security allowance if supplies are short. These funds would be distributed through the state governments, which, critics say, would lead to more avenues for corruption. There’s still a huge amount of confusion surrounding the bill, some of which may be cleared by the time the ordinance comes up for parliamentary approval. The government has said it may be a while before the plan is implemented.