Food crisis : How will the country feed its poor?
Nepal seems to be moving in the direction of solving its political crisis. But it is on the verge of another crisis, i.e., food crisis caused by rising food prices and changes in the export policies of other countries, mainly India, on which it is partly dependent. It has not yet experienced food riots of the kind seen in Haiti, The Philippines, Zimbabwe or Argentina. But if the trend of price rise and food unavailability continues, riots are not unlikely. This issue has not been taken seriously by policymakers. The thinking goes that if the politics is made right, every other problem will be corrected.
Prices of basic food items like rice, wheat flour and cooking oil have skyrocketed over the last six months. The price of cooking oil has increased by about 50% and that of rice by 30% in this period. If the trend continues, poor people will not be able to afford food. As they already spent more than 75% of their income on food, any increase in price will directly reduce the amount of food and other non-food essentials they can purchase.
As the expenditure on food increases, poor households will have less to spend in other activities like healthcare and children’s education. This has also led to the increase in burden on elderly and children, which is seen in the form of their participation in work force to generate extra income for food purchase. Accordingly, poor parents have taken out their children from schools and have put them in income earning activities. One of the reasons poor households feel the immediate impact of price rise is that they do not have the capacity to stock food. As a result, fluctuation in the price of food affects them. Because of the loss of their subsistence economy based on farming, even the middle income families are adversely affected by this fluctuation as they depend on market for food.
Studies have shown that food stocks of poor households in 38 districts have reduced by half because of increase in food price. The mid-west and far-west regions have been the hardest hit. One of the main coping mechanisms traditionally adopted in these regions to meet shortages is to work in India. But because of rise in food prices in India too, the savings these migrants generate have also fallen.
The problem in Nepal is also an offshoot of the general price rise at the international level. For example, price of rice increased by about 130% last year. The increased fuel prices making the cost of agricultural production high, adverse impact of climate change in productivity of crops, conversion of food into bio-fuel, and demand for luxury foods by the noveau riche in India and China diverting resources are considered as factors responsible for increase in food prices internationally.
International food politics is also often blamed for the present food crisis. This perception is strong among the members of civil society, who consider the food problem unrelated to climate change and decline in production and productivity, but the result of increased involvement of multinational companies.
This is especially so in India. As Nepal’s dependence on India for food has increased over the last two decades, agricultural situation in India directly affects Nepal. At present, about 25% of the prime land in India which receives year-round irrigation has been conserved for foods meant for wealthy and for export. These lands, which previously were used for cereal production, are now converted into orchards. As a result, production of basic cereals like rice and wheat is declining, leading to lesser availability of staple foods for the poor.
Even though international problems like rise in price of petroleum products is also responsible for the present food crisis in Nepal, wrong domestic agricultural policy is the main cause of the crisis. Since the mid 1990s, agricultural sector as a whole received less attention from the government as well as donors. There was/is a thinking that if other sectors of the economy can grow and increase income, people can buy the food that comes from other countries. Until now, imported food, especially rice and wheat, were cheaper because of subsidies given in other countries, mainly India, from where these foods were imported.
Domestic production could not compete with imported food. As a result, Nepal’s food production and crop productivity declined, and people started giving up farming as a profession. Nepal’s dependence on other countries for food started growing. The danger of this dependence is clearly seen now. India has banned export of basic food like rice and wheat.
Other food exporting countries have also imposed such barriers. As a result, there is a real danger that overall availability of food might decline. In this situation even if people have money, they will not be able to buy the food. This bitter experience needs to be taken seriously. This also calls for a policy of self-sufficiency in basic staple foods.
Dr Adhikari is a food economist