Context:-
The first and historic United Nations Food Systems Summit (UNFSS) 2021 which was held in September this year, concluded after an intense ‘bottom-up’ process conceived in 2019 by UN Secretary General António Guterres to find solutions and ‘catalyse momentum’ to transform the way the world produces, consumes, and thinks about food and help address rising hunger.
With an alarming escalation in global hunger unfolding, reaching the goal of an equitable livelihood is a necessity.
Putting things in Perspective:-
In terms of larger goals, the food system transformation is considered essential in achieving the sustainable development agenda 2030. This makes strong sense as 11 Sustainable Development Goals (SDGs) out of 17 are directly related to the food system.
The summit involved several activities before the runup to the meeting of the Head of States on September 23. While the dialogues on the five tracks identified have been under way for the past 18 months, the world has seen the fragility and vulnerability of food systems, highlighted by the disruptive impact of the COVID19 pandemic that is projected to double the global hunger figure.
Why the Food Systems Summit and what is the expectation from its outcome?
1) Global food systems — the networks that are needed to produce and transform food, and ensure it reaches consumers, or the paths that food travels from production to plate — are in a state of crisis in many countries affecting the poor and the vulnerable.
2) The flaws in food systems affect us all, but most of all they are affecting 811 million people in the world who go to bed hungry each night. The summit created a mechanism for serious debates involving UN member states, civil society, non-governmental organisations, academics, researchers, individuals, and the private sector, which is to evolve transformative themes and ideas for reimagining food systems to enhance satisfaction of all stakeholders including future generations.
3) The debate and response focused on five identified action tracks namely:
- Ensure access to safe and nutritious food for all;
- Shift to sustainable consumption patterns;
- Boost nature positive production;
- Advance equitable livelihoods, and
- Build resilience to vulnerabilities, shocks, and stress.
4) The summit provided a historic opportunity to empower all people to leverage the power of food systems to drive our recovery from the COVID19 pandemic and get us back on track to achieve all 17 SDGs by 2030.
5) The Statement of Action emerging from the summit offers a concise set of ambitious, high-level principles and areas for action to support the global call to “Build back better” after the COVID19 pandemic.
India constituted an interdepartmental group under the Chairmanship of one of us , with representatives from the Ministries of Agriculture and Farmers’ Welfare, Rural Development, and others. Delhi based U.N. agencies namely the Food and Agriculture Organization (FAO), the World Food Programme (WFP), and the International Fund for Agricultural Development (IFAD) were also actively involved in the dialogue process.
6) The group conducted national dialogues with various stakeholders of agri-food systems to explore national pathways towards creating sustainable and equitable food systems in India. Several individuals and civil society organisations contributed ideas to the portal which was created for this purpose.
Helping the developing world
There are lessons from India’s tryst with food insecurity. Several themes that have emerged in the discussions and dialogues leading up to the summit find resonance with India’s past and ongoing journey towards creating and improving food and livelihood security.
The long journey from chronic food shortage to surplus food producer offers several interesting lessons for other developing countries in Asia, Africa, and Latin America in the area of land reforms, public investments, institutional infrastructure, new regulatory systems, public support, and intervention in agri markets and prices and agri research and extension.
The period between 1991 to 2015, saw the diversification of agriculture beyond field crops and brought greater focus on the horticulture, dairy, animal husbandry, and fishery sectors. The learnings encompassed elements of nutritional health, food safety and standards, sustainability, deployment of space technology, and the like.
Safety nets, challenges One of India’s greatest contributions to equity in food is its National Food Security Act 2013 that anchors the Targeted Public Distribution System (TPDS), the Mid-Day meals (MDM), and the Integrated Child Development Services (ICDS).
Today, India’s food safety nets collectively reach over a billion people. Food safety nets and inclusion are linked with public procurement and buffer stock policy. This was visible during the global food crises 2008-2012 and more recently during the COVID19 pandemic fallout, whereby vulnerable and marginalised families in India continued to be buffered against the food crisis by its robust TPDS and buffer stock of food grains.
Challenges and the way forward towards 2050.
Climate change and unsustainable use of land and water resources are the most formidable challenges food systems face today. The latest Intergovernmental Panel on Climate Change (IPCC) report has set the alarm bells ringing, highlighting the urgency to act now.
Dietary diversity, nutrition, and related health outcomes are another area of concern as a focus on rice and wheat has created nutritional challenges of its own.
India has taken a bold decision to fortify rice supplied through the Public Distribution System with iron.
Agricultural research institutes are about to release varieties of many crops having much higher nutrition as a long-term solution for undernutrition and malnutrition.
Surplus and low nutrition:- The Irony
It is ironic that despite being a net exporter and food surplus country at the aggregate level, India has a 50% higher prevalence of undernutrition compared to the world average.
But the proportion of the undernourished population declined from 21.6% during 200406 to 15.4% during 2018-20. The high prevalence of undernutrition in the country does not seem to be due to food shortage or the low availability of food.
The Government of India and States are seriously concerned about this paradoxical situation of being food surplus and at the same time, having 15% of the population undernourished.
They are trying to address other possible reasons for low nutrition through several nutritional interventions. As announced recently, the supply of fortified rice in PDS and Poshan Abhiyan are the two steps among many to address the challenge of undernutrition and malnutrition.
Reducing food wastage or loss of food is a mammoth challenge and is linked to the efficiency of the food supply chain. Food wastage in India exceeds ₹1lakh crore.
Why the world must eliminate hunger is the next point. An alarming escalation in global hunger is unfolding, with the ‘dramatic worsening’ of world hunger in 2020, much of it likely related to the fallout of COVID19.
While the pandemic’s impact has yet to be fully mapped, ‘The State of Food Security and Nutrition in the World’ report, estimates that around a tenth of the global population was undernourished last year.
It is important to reiterate that hunger and food insecurity are key drivers of conflict and instability across the world. ‘Food is peace’, is a catchphrase often used to highlight how hunger and conflict feed on each other.
The Nobel Peace Prize 2020 conferred on the United Nations WFP highlighted the importance of addressing hunger to prevent conflicts and create stability.
The citation communiqué articulated this well by quoting the line: “Until the day we have a medical vaccine, food is the best vaccine against chaos.”
For equity, sustainability
We are on the cusp of a transformation to make the world free of hunger by 2030 and deliver promises for SDGs, with strong cooperation and partnership between governments, citizens, civil society organisations, and the private sector.
We must collaborate to invest, innovate, and create lasting solutions in sustainable agriculture contribution to equitable livelihood, food security, and nutrition.
India has so much to offer from its successes, and learning also, to prepare itself for the next 20 to 30 years. This surely requires reimagining the food system towards the goal of balancing growth and sustainability, mitigating climate change, ensuring healthy, safe, quality, and affordable food, maintaining biodiversity, improving resilience, and offering an attractive income and work environment to smallholders and youth.
Achieving the goal of “Advancing equitable livelihood” requires that the food systems transformation is anchored around small and medium scale production, family farmers, indigenous peoples, women, and workers in food value chains.
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Petrol in India is cheaper than in countries like Hong Kong, Germany and the UK but costlier than in China, Brazil, Japan, the US, Russia, Pakistan and Sri Lanka, a Bank of Baroda Economics Research report showed.
Rising fuel prices in India have led to considerable debate on which government, state or central, should be lowering their taxes to keep prices under control.
The rise in fuel prices is mainly due to the global price of crude oil (raw material for making petrol and diesel) going up. Further, a stronger dollar has added to the cost of crude oil.
Amongst comparable countries (per capita wise), prices in India are higher than those in Vietnam, Kenya, Ukraine, Bangladesh, Nepal, Pakistan, Sri Lanka, and Venezuela. Countries that are major oil producers have much lower prices.
In the report, the Philippines has a comparable petrol price but has a per capita income higher than India by over 50 per cent.
Countries which have a lower per capita income like Kenya, Bangladesh, Nepal, Pakistan, and Venezuela have much lower prices of petrol and hence are impacted less than India.
“Therefore there is still a strong case for the government to consider lowering the taxes on fuel to protect the interest of the people,” the report argued.
India is the world’s third-biggest oil consuming and importing nation. It imports 85 per cent of its oil needs and so prices retail fuel at import parity rates.
With the global surge in energy prices, the cost of producing petrol, diesel and other petroleum products also went up for oil companies in India.
They raised petrol and diesel prices by Rs 10 a litre in just over a fortnight beginning March 22 but hit a pause button soon after as the move faced criticism and the opposition parties asked the government to cut taxes instead.
India imports most of its oil from a group of countries called the ‘OPEC +’ (i.e, Iran, Iraq, Saudi Arabia, Venezuela, Kuwait, United Arab Emirates, Russia, etc), which produces 40% of the world’s crude oil.
As they have the power to dictate fuel supply and prices, their decision of limiting the global supply reduces supply in India, thus raising prices
The government charges about 167% tax (excise) on petrol and 129% on diesel as compared to US (20%), UK (62%), Italy and Germany (65%).
The abominable excise duty is 2/3rd of the cost, and the base price, dealer commission and freight form the rest.
Here is an approximate break-up (in Rs):
a)Base Price | 39 |
b)Freight | 0.34 |
c) Price Charged to Dealers = (a+b) | 39.34 |
d) Excise Duty | 40.17 |
e) Dealer Commission | 4.68 |
f) VAT | 25.35 |
g) Retail Selling Price | 109.54 |
Looked closely, much of the cost of petrol and diesel is due to higher tax rate by govt, specifically excise duty.
So the question is why government is not reducing the prices ?
India, being a developing country, it does require gigantic amount of funding for its infrastructure projects as well as welfare schemes.
However, we as a society is yet to be tax-compliant. Many people evade the direct tax and that’s the reason why govt’s hands are tied. Govt. needs the money to fund various programs and at the same time it is not generating enough revenue from direct taxes.
That’s the reason why, govt is bumping up its revenue through higher indirect taxes such as GST or excise duty as in the case of petrol and diesel.
Direct taxes are progressive as it taxes according to an individuals’ income however indirect tax such as excise duty or GST are regressive in the sense that the poorest of the poor and richest of the rich have to pay the same amount.
Does not matter, if you are an auto-driver or owner of a Mercedes, end of the day both pay the same price for petrol/diesel-that’s why it is regressive in nature.
But unlike direct tax where tax evasion is rampant, indirect tax can not be evaded due to their very nature and as long as huge no of Indians keep evading direct taxes, indirect tax such as excise duty will be difficult for the govt to reduce, because it may reduce the revenue and hamper may programs of the govt.