The National Food Security Bill (NFSB) has been the center of much debate since it was introduced in Parliament by the UPA government in December 2011. One of the most persistent arguments against a food security bill from the corporate lobby, lead by the FICCI and CII, is that its costs will burden the budget and slow economic growth. They argue that to sustain a high growth rate it is necessary to use available resources on keeping taxes down and supporting industry which are perceived to be better drivers of economic growth. Such an argument, however, is misplaced. It assumes that securing food for everyone is a matter of generosity, and that nothing is gained from providing food security. Both propositions are wrong. First, The Supreme Court, on the basis of the Constitution, has ruled that the right to life with human dignity, including the right to food and other basic necessities, is a fundamental right which the government carries the main duty to respect, protect and fulfil. Second, securing the right to food is integral to economic development. Providing adequate food for everybody should be seen as an investment in human capital.
According to the Copenhagen Consensus, an expert panel consisting of leading economists identifying the most worthwhile solutions to the most pressing problems of the world, securing micronutrients is the investment carrying the highest returns. There are several reasons why malnutrition is bad for economic growth. It can be useful to divide the losses into three categories. 1) Direct losses in productivity from poor physical status. 2) Indirect losses from poor cognitive development and schooling. 3) Loss in resources from increased health care costs of ill health. This leads to a vicious cycle since 1+2+3 leads to poverty for the individual which in turn increases the likelihood of malnutrition. Children are especially vulnerable, so children in households faced by food shortage are likely to enter adulthood without the physical or mental ability to earn enough to secure adequate food for their children, which means that malnutrition is likely to be persistent through generations.
How much can be won by eradicating malnutrition in India? Much it seems, because the problem is huge. India is placed 106th of 120 countries in the World Hunger Index from 2012 below Rwanda, Sudan and Niger. The proportion of undernourished in the population rose from 17% to 19% between 1996 and 2012, while the proportion of undernourished children under 6 year has risen from 41.1% to 43.5% during these 16 years. According to the National Family Health Survey of 2005/06 the proportion of stunted children is 44.9%. 69.5% of children and 55.3% of women suffers from Anaemia primarily caused by malnutrition. Calculating the exact cost of malnutrition is notoriously difficult, but conservative estimates says that India lose about 4 % of its GDP in efficiency loss alone. In addition to this comes increased health care cost to take care of a staggering number of physically and mentally impaired people. That is, if any medical care is provided in the first place.
Compare this to the estimated cost of the proposed food security bill. The estimated cost of implementation of the bill is around Rs 100,000 crore per annum. This is just Rs 35,000 crore, or less than 0,4 % of GDP, more than the existing food subsidy cost for the Targeted Public Distribution System and other welfare schemes. Tax revenue subsidy for the financial year 2011-12 was Rs 622,000 crore or more than 17 times the additional food subsidy cost. There is little evidence that tax subsidies is an effective driver of growth, in the same explosive manner as investment in human capital can be. If it was, then we should see vast improvement in the economy of India as tax subsidies have skyrocketed in recent years. It seems as spending could and should be allocated differently.
The investment deal looks like this: The government secure that no one is deprived of the opportunity to feed themselves. In return it can reap the benefits from a more productive workforce that requires less health spending. Like with any investment, it is important to ensure that the returns of the investment are as high as possible. This is best done by adopting a broader focus on securing nutrition instead of the grain-centered approach currently proposed in the NFSB. The food items provided should be more diverse. As a minimum, pulses, to provide protein in a protein deficient population, and edible oil, to provide fat, should also be provided to ensure better overall nutrition.
Children under the age of two are those who carry the greatest risk of permanent physical and mental underdevelopment through malnutrition. It is therefore regrettable that the NFSB does not make the Integrated Child Development Services (ICDS) a legal guarantee. It is not included on the grounds of programmatic and operational shortcomings. The services of the ICDS should instead be universalized. Through the anganwadis the ICDS should deliver supplementary nutrition, health check, referral services, immunization and education in nutrition and health in order to ensure the nutritional status of children and lactating and pregnant women. The NFSB should also provide support for breastfeeding.
Food is important but access to clean drinking water and sanitation is also an integral part of reducing malnutrition, as the food has to be absorbed to provide nutrition. Every year 200,000 children die from Diarrhea in India, and 88% of these deaths are a result of inadequate sanitation and unsafe drinking water. Many of the children who survive will be permanently malnourished. Therefore, The Rajiv Gandhi National Drinking Water Mission and The Total Sanitation Campaign should be linked to the food security legislation and provide incentives for improved coverage.
A major problem of the Public Distribution System (PDS) has been that less than 60 percent of the food reaches its intended beneficiaries. The restructuring of the PDS included in the proposed bill will go some way in reducing the leakage by removing the above poverty line quota, broaden the base of beneficiaries and creating clear entitlements. The bill, however, still faces the problem of relying on an arbitrary cut-off point of 75% of the rural population and 50% of the urban population, where it is up to the states to identify the eligible households. This leads to inclusion and exclusion error causing ineffectiveness, corruption and human tragedy. Effectiveness could be improved by instead relying on a system of self-exclusion based on easily identifiable criteria.
There are a lot of reasons why the government should prevent malnutrition and hunger: It is a necessity for the dignity of human beings, it empowers the powerless, it reduces child mortality, it promotes gender equality and it aids the achievement of universal education. But it is also recommendable through purely economic reasoning alone. The question should thus read: Can India afford not to have a comprehensive food security bill?
Mr. Simon Jakobsen is a student at Aarhus University and currently interning at the AHRC. The author can be contacted at simon.jakobsen@ahrc.asia.
