Behind the rant against food bill
The passage of the two crucial draft legislations, the Food Security Bill and the Land Acquisition Bill, a collective roar has been sounded from the hordes that put economic growth over holistic development. With the financial boom tapering off and the United States withdrawing its short term bond schemes that had pumped in surplus capital into not just the Indian, but many of the emerging markets, the business sector clearly needs a scapegoat to sacrifice at the altar of the ongoing fiscal crisis, and nothing fits better than the two welfare-driven legislations that aim to alleviate some of the wretched conditions of the country’s teeming poor. The UPA government, which has, in its second tenure, brought in the slew of extremely pro-market FDI reforms, has, nevertheless, been branded a ‘socialist’ regime, thanks to the draft legislations that pay attention to the needs of the underprivileged, and yet again bows to the corporate demands. While the India Inc has not taken well to the two bills, both of which have now been passed in the Lok Sabha and are awaiting their clearance in Rajya Sabha, it has fired several propaganda missiles demonising the two legislations, in an attempt to turn the tide and further inflame the passions of the country’s beleaguered middle classes that have been worst affected by the current economic slump. Hence, the received wisdom that puts the fiscal deficit and currency collapse on the passage of the food and land bills is nothing but a concerted attempt to deflect the national spotlight on pro-people (not just populist) measures and extract more unmerited leverage from the government. Evidently, the chorus of lament that bemoan the demise of the India story holds the rupee decline as the fall out of a law in the making that would barely use 1.2 per cent of the GDP, and would continue to try derail the limited welfare express that has now left the station.
It is indeed a wonder that the current food subsidy, around Rs 90,000 crores with an average subsidy of Rs 20 per kilo of food grains, is only supposed to go up only by Rs 1,24,000 crores (for 62 million tonnes), around 1.2 per cent of the GDP, when the food bill comes into effect, and despite the rather tiny readjustment, it has caused such a massive uproar in the industrial classes. Moreover, as several economists have cited, the food subsidy has hovered around a stable one per cent of the GDP, while the percentage of households accessing food grains from the public distribution system has gone up from 28 per cent in 2004-05 to about 39 per cent in 2009-10 and 44 per cent in 2011-12, despite the expenditure staying constant at about one per cent GDP, clearly establishing that the PDS has gradually improved in efficiency. Hence, to label the welfare schemes as merely ‘populist’ is but a malignant attempt to airbrush the positive steps taken to help those living in abject squalor. Along with the Land Acquisition Bill, which is expected to fetch better compensation against land sold to government for infrastructure development, the Food Bill is a guarantee and the first safety belt for many, particularly in times of economic crisis, when even the service sector is witnessing shrinkage. Moreover, the fulcrum of the democratic machinery happens to be dignity and justice for all and it is absolutely illegitimate to let the market hold to ransom our cherished beliefs enshrined in the constitution.