NEW DELHI: India’s ruling party said yesterday a vast new food scheme for the poor was a “game-changer” to fight endemic malnutrition, but analysts expressed concern about the programme’s implementation and cost.
The cabinet issued an executive order late on Wednesday introducing the National Food Security Bill, which is expected to be approved by the president and be a vote-winning measure ahead of elections next year.
The programme — which the government says will add Rs230bn ($3.8bn) per year to the country’s existing Rs900bn food subsidy bill — will offer subsidised grains to an estimated 810 million people.
It has been pushed strongly by the head of the ruling Congress party, Sonia Gandhi, who has insisted on honouring a 2009 election pledge despite concerns about the impact on government finances and food prices.
“It is going to be a game-changer in terms of poverty eradication,” senior Congress leader Tom Vadukkan said. “If basic needs like hunger are not met, you can’t talk about (economic) development.”
Despite two decades of strong economic growth, India still struggles to feed its population adequately, with a survey last year showing that 42 percent of children under five were underweight.
The food measure, which will offer five kilograms per person per month for as little as one rupee per kilo, is considered key to the Congress-led coalition’s fortunes in national elections due in 2014.
“If it wins us votes, then that is an afterthought,” Vadukkan, also a party spokesman, claimed. “Naturally anything good that you do gains you popularity.”
India’s opposition parties have rounded on the government for ramming through a controversial programme without a parliamentary debate, but the executive order is only temporary and must be converted into law.
It will be introduced later this month or in August in the next session of parliament, which has been stalled for much of the last two years due to repeated protests by the opposition.
“It is just a political gimmick in a hurry,” the leader of the opposition Bharatiya Janata Party, Rajnath Singh, told reporters yesterday.
Critics of the food programme say that India can ill-afford such a costly subsidy burden at a time of slowing economic growth and when credit ratings agencies are eyeing the country’s large deficit.
“India’s current macroeconomic position does not provide the space to implement this policy,” said Sonal Varma, an economist with Nomura Securities.
Economic growth is at a decade-low of five percent, the government is running large fiscal and current account deficits, and the rupee has slumped to a historic low against the dollar.
Indians classed as below the poverty line already receive subsidised kerosene, cooking gas, fertilisers and wheat through what is the world’s biggest public distribution system.
But the welfare programmes are inefficient and riddled with graft. Many of the 360 million people who receive subsidised grains complain about the poor quality.
Siddhartha Sanyal, chief India economist with Barclays Capital, said that implementation would be a “huge logistical problem, with coordination required from all states”.
AFP
