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Agriculture and food security

Agriculture and food security

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Agriculture and food security

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  1. Agriculture and food security Himanshu

  2. Agrarian Revival since 2005 • Signs of revival since 2004-05 after the worst agrarian crisis during 1997-2004 • Agricultural growth rate picked up: more than 3% after 2004-5 • Agricultural investment picked up • Agricultural credit doubled • Good monsoon • TOT moving in favour of agriculture

  3. Worrying trends since 2009 • Growth slowed down, less than 0.5% during 2008-09 and 2009-10 • Partly drought but are there structural issues • Not so clear at this stage due to lack of data • Cost of cultivation has gone up sharply • Terms of trade have started moving against agriculture • stagnation in agriculture credit off-take • Environmental factors

  4. Food grains TOT is declining

  5. International food prices are also declining

  6. Cost of cultivation has gone up

  7. Cash cost is increasing since 2009, mainly labour, diesel and fertiliser

  8. Fertiliser capacity has remained stagnant

  9. Imports have increased. Introduction of NBS

  10. Impact of NBS: distortion in prices

  11. Was the revival real? • The movement in TOT was led by increase in MSP and speculative activity • Not enough evidence of this being demand led • Rural demand growth due to NREGA etc appears to be exaggerated • Food price inflation: structural, speculation

  12. What to expect in future • Urea prices likely to be increased • Diesel prices likely to be increasing • Unlikely that demand increases domestically or internationally • International prices likely to stay low • Fear of high fiscal deficits likely to put pressure on agricultural investments as well as food, fertiliser and other subsidies

  13. Food security • Malnutrition situation is not showing any signs of significant improvements • Hungama report (2011) confirms the severity of the malnutrition problem • some inference on the basis of calorie intake data • The decline in calorie intake between 2005-2010 has been the worst • The Myth of diet diversification

  14. Calorie Intake from NSSO