By Categories: Editorials, Society

Some call it world hunger. 

Not because of someone’s hopeful wish, but because the world produces enough calories to go around. Each day, farmers grow 2,800 calories per person on the planet, according to the U.N. Food and Agriculture Organization (FAO). That’s enough to surpass the recommended intake of 2,100 daily calories per person—and enough to support a population inching toward nine billion, and then ten billion. 
 
So why do 805 million people still have too little to eat?That’s an irony.
To start with, it’s important to understand the difference between hunger and undernourishment.
 
People all over the world go hungry, even for just a few hours, when they don’t have enough to eat. Hunger is a physical condition marked by stomach pangs and general fatigue.
 
Undernourishment is a more chronic condition than hunger. Undernourishment affects communities, and even entire countries and regions.
 
Measuring Undernourishment
 
Each year, the FAO measures undernourishment around the world.
 
“What we try to do is come up with a comprehensive picture of food insecurity,” says FAO economist Josef Schmidhuber.
 
The process is never simple. In countries most at need, development agencies find it hard to get food in and data out. Food often doesn’t get to the people who need it. Some of these people are isolated in rural communities, while others live in politically unstable countries or areas ravaged by natural disasters.
 
Africa has the highest rate of undernourishment. In the Central African Republic, where 38 percent of people are undernourished, an ongoing civil war has led to widespread displacement, which leads to disruptions in the food supply and distribution. The culprit in Zambia (48 percent undernourished) is infrastructure: Less than 20 percent of the population has access to a durable road.
 
Asia has the most undernourished people. According to FAO researchers, parts of Africa and Asia are plagued by a lack of income, poor agricultural development and few social safety nets. North Korea may be the best example of a country with a political climate that limits trade and food aid.
 
No country has it worse than Haiti, however. Even though the Western Hemisphere has almost uniformly reduced undernourishment over the past 20 years, the island nation has been relentlessly attacked by natural hazards and political instability. An earthquake in 2010, followed by several hurricanes in 2012 and a drought in 2014 have limited Haiti’s capacity to nourish its population.
 
There is some good news: Since 1990, the overall number of undernourished people around the world has gone down—that means 209 million fewer undernourished people.
 
Solving World Undernourishment
 
Ultimately, solving world undernourishment comes with diminishing returns. The more progress you make, the more challenging the remaining work becomes.
 
As places like sub-Saharan Africa increase their production of food staples, they then need to focus on distributing it to the people who need it most. Many regions lack infrastructure such as roads and bridges that can accommodate trucks carrying food.
 
So, someone looking to alleviate world hunger doesn’t only need to focus on food, but on building roads and more secure buildings. Stable governments can help ensure fewer people go hungry. And when a country’s economy grows, almost everyone is better off.
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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.

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