JOIN USRight to free food and the economy
Is the right to food a statutory right, a fundamental right, or a human right? India is a signatory to the 1966 International Covenant on Economic, Social and Cultural Rights from which the right to food is derived. So, this right has elements of being a human right, beyond sovereign borders. India’s own National Human Rights Commission (NHRC) has held it to be a fundamental right, linking it to Article 21 of the Constitution (right to life with dignity) along with Articles 39 (a) and 47. These latter, both part of Directive Principles, require the State to provide a right to adequate means of livelihood (Article 39 (a)) and a duty to raise the level of nutrition and standard of living (Article 47). The NHRC has said that starvation is tantamount to denial of fundamental rights. It also said that proof of starvation need not mean starvation deaths. The crisis has to be recognised much earlier. The NHRC called for a paradigm shift in public policy and to ensure adequate food and nutrition to all citizens as a paramount objective. The prevalence of hunger and distress is to be interpreted as injury and requires that the State be penalised for such a state of affairs. In short, even if it costs a lot to the exchequer, removal of hunger should be a top policy priority.
This view of the NHRC is important in light of the government’s recent decision to extend the free food grain programme for another three months. That extra cost will be Rs 44,000 crore. The Pradhan Mantri Gareeb Kalyan Anna Yojana (PMGKAY) would be the longest-running and largest free food distribution scheme in the world, running for 33 months and more if extended beyond December.
The right to food, as recognised by India’s international obligation since it is a signatory to the International Covenant, does not mean that the food should be given free. But a situation of grave distress manifested through starvation deaths implies that free food is an imperative. Twenty years ago, the right to food campaign started in India as an offshoot of a public interest litigation in the Supreme Court. That PIL was prompted by the fact that the State granaries then had gigantic stocks of food grain while there was evidence of starvation and malnutrition around the country.
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One of the consequences of the sustained national campaign was that the National Food Security Act (NFSA) was passed in 2013. There were a lot of objections, especially from fiscal hawks who were worried about the huge financial burden. There were objections from cabinet ministers as well. The NFSA entitles each household 5 kilos per person per month of rice, wheat or jowar/bajra at Rs 3, 2 or 1 per kilo. One minister had quipped that since it costs Rs 20 to produce a kilo of rice, and Rs 3 to get it under this Act as a right, why would any farmer bother to produce rice at all? This was not ridicule but pointed to the heavy fiscal cost.
The NFSA covers three-fourths of the rural and half the urban population, i.e., nearly 810 million people. The poorest are given 35 kilos of food grain per family per month under the Antyodaya Anna Yojana. With a steep subsidy there is always the possibility that recipients sell the food in the secondary market. What the PMGKAY did was to extend the food grain completely free. If there was leakage under NFSA, surely the possibility exists under PMGKAY too. How is that leakage to be prevented?
The PMGKAY was started in April 2020 because of Covid. India did not want a livelihood crisis to become a full-blown food crisis. It has served us well, and at a time of food inflation, it protects families from rising food prices. A direct cash subsidy of a fixed amount does not protect the recipient from food inflation. But the scheme has been extended six times. The latest extension to December 2022 was given because of the upcoming state elections in Himachal Pradesh and Gujarat. There is now ample evidence that PMGKAY has given electoral benefits to the incumbent political party.
Interestingly, the current extension was opposed by the Finance ministry, due to the higher fiscal burden. The three-month extension alone will cost Rs 44,000 crore. Cumulatively, PMGKAY has cost the exchequer Rs 4.5 lakh crore, which amounts to 2per cent of India’s GDP. Due to rising oil prices, the fertiliser subsidy is likely to go up to Rs 2 lakh crore this year, although only Rs 1 lakh crore has been budgeted. The Finance Secretary was sanguine and confident of meeting the fiscal deficit target this year, since tax collections have been very good. But his statement was made before the cabinet decision to extend PMGKAY. Also, the high advance taxes paid under income tax could lead to a big amount of refunds, which we will know only next year.
The question then is, to accommodate PMGKAY, will we be sacrificing something else? It was under fiscal pressure that the government had to launch Agnipath, the short-term military service scheme for non-commissioned personnel. Even the CISF’s strength has been cut at some airports. Increase in support for free food means cutting back on maybe health, education, infrastructure, military or pension benefits. The government cannot escape these difficult fiscal trade-offs.
If growth slows down, and tax collection is not as buoyant as expected, and if subsidy and welfare spending commitments increase, then how is the circle to be squared? Remember that interest rates are rising, so the cost of borrowing for the government too will go up. The debt-to-GDP ratio could rise to 95per cent. Interest burden alone could top Rs 7 lakh crore or even higher. At the same time, schemes such as free or subsidised food, free mid-day meals for schoolchildren, nutrition programme for pregnant mothers all have elements of human rights and fundamental rights. The beneficiaries have a “claim” on these. India is also thinking of going in for universal basic income, which will add to the fiscal burden. Walking the tightrope between free food and other government priorities will be tough.
(The writer is a noted economist) (Syndicate: The Billion Press)