A panel discussion titled “Global Food Crisis and Inflation” was organized by Anvesha on 31 May, 2008 at VP House (near Planning Commission, Government of India). Prof. Arjun Sengupta[1], the first speaker talked about speculation in commodity markets and rise in food prices at the world level. He spoke about the implications of price inflation in a global market economy. He said that it is difficult to change the current trend of inflation in food prices. He informed that bio-fuel production is extremely subsidized in the US, which is not the right kind of economic policy. Prices of crude oil are going up, he added. There is a need for the right kind of technology to increase agricultural production, he emphasized upon. He said that increase in investment in irrigation do not necessarily lead to higher agricultural production, unless farmers think that agriculture is a profitable venture. Although the Indian economy is growing but few are enjoying the benefits of economic growth. People at the marginal level are pushed into destitution level, he added. Majority of the poor are not gainfully employed. They do not have earning (purchasing) power, he informed. Prof. Sengupta said that there is need to look at how to increase employment. He said that employment has definitely increased in the unorganized sector but there is a need to think about job security. He said that there are different methods to calculate unemployment. It is essential to look at whether people employed in the unorganized sector get minimum wages. There is need to consider about ‘gainful’ employment. The process of economic growth is highly unequal. There is need for industrialization, which is job oriented. It is required to have a relook at: employment, credit, technology and investment policies. Social security should be immediately provided to the poor. Small and marginal farmers who constitute a major portion of the agricultural workforce, should be provided a foothold. The Reserve Bank of India and the government do not have enough facts and figures on what amount of credit is actually provided to the poor, he said. The public distribution system (PDS) should look at the poorest of the poor. There is need for universalisation of the PDS, he claimed.
Mr. Prabir Purakayastha[2] said that there is a serious problem associated with R & D at CSIR and ICAR.
Prof. Abhijit Sen[3], second speaker said that the prices are not going to come down. One has to look historically at the inflationary trend. He said that INR 200,000 crore is the loss to the Indian economy due to rise in international prices of crude. Fertilizer prices are going to increase due to rise in crude prices. There will be trade-off between subsidies (for keeping prices down) and rise in administered prices in India. Food prices increase is not a big issue in India, as compared to the world level. Both WPI and retail prices of food have increased. Food prices at the world level are rising sharply compared to India. There is crisis with global capitalism. World capitalism has also seen bubble burst in early 2000s. India and China are growing faster since last 4 years. So their growth is not leading to inflation, which was being alleged by President Bush. In the US, majority of the people believe that speculation is leading to inflation, he added by referring to George Soros. He asked for rethinking on saving oil and fertilizer. He asked for reducing the number of cars on roads. He asked for a good public transport system, which can save petroleum usage. He said that India has enough wheat stock presently, which can be distributed via the PDS. There is a need to oppose targeted PDS and accept universal PDS. There is also a need to increase the minimum support price (MSP) of paddy, said Prof. Sen. Fiscal discipline should not lead to contraction in expenditure on important programmes like National Rural Employment Guaranty Act (NREGA). While the Sixth Pay Commission is providing huge salary increase to non-poor people, enough is not done for programmes like NREGA which serves the poor.
The third speaker Sitaram Yechury[4] asked the question how should see inclusive growth. He said that neo-liberal policy is deflationary in nature, which allows for speculation. Economic inequalities are rising due to the current economic policies, which are being pursued. There is jobless growth being faced by India, he said. He asked for looking at global financial capital flows. There is a need for looking at trading in derivatives (from the website: www.bis.org). He asked: If NT Rama Rao government in Andhra Pradesh can provide rice at Rs. 2/- per kg, then why the same can’t be done by the present UPA government. There is a need to provide social security to the poor, he added. He said that the windfall profit earned by Reliance on gas production from Andhra Pradesh’s Godavari delta region needs to be taxed. Government should provide helping hand to the poor and not the companies, whose owners are rich. There is a need to check the conspicuous consumption practices of the big industrialists. He said that in between 1996-2004, India faced stagnation in agriculture. After that agricultural production has gone up. There are uncertainties in a globalised economy. The government should not lose its public sector units, he emphasized. He said that India should have enough buffer stock. Organized sector rely upon capital-intensive technology. So he asked for labour-intensive technology, which can provide jobs.
After a brief consultation among the speakers and the audience, the panel discussion ended.
[1] Prof. Arjun Sengupta is a former professor at the School of International Studies, Jawaharlal Nehru University, and currently an adjunct professor at the Harvard School of Public Health and Chairman of the Center for Development and Human Rights in New Delhi. He is the former UN Independent Expert on the Right to Development and current Independent Expert on Human Rights and Extreme Poverty. He is also the Co-Director, with Professor Stephen Marks, of the Right to Development Project at the François-Xavier Bagnoud (FXB) Center at The Harvard School of Public Health. Professor Sengupta has held numerous positions of high office in the Government of India. In the 1980s he was Economic Advisor to the Prime Minister of India. Subsequently, he was an Executive Director of the IMF in Washington DC, and India's Ambassador to the European Union. In his capacity as Independent Expert on the Right to Development, Dr. Sengupta reported to the Open-Ended Working Group on the Right to Development at each of its sessions on the current state of progress in the implementation of the right to development as a basis for a focused discussion, taking into account, inter alia, the deliberations and suggestions of the Working Group.
[2] He is from Delhi Science Forum (www.delhiscienceforum.net).
[3] Prof. Abhijit Sen has a Ph.D. in Economics from the University of Cambridge. He has joined Planning Commission on leave as Professor of Economics in Jawaharlal Nehru University. He earlier held teaching posts at the Universities of Sussex, Oxford and Cambridge and is currently on the Senate/Executive Committees of University of Delhi, IIT (Delhi) and National Centre for Agricultural Policy. In the past, Prof. Sen has been on a number of official Commissions/Committees; including: Chairman, High level Committee on Long Term Grain Policy, Ministry of Consumer Affairs, Food and Public Distribution, Government of India, 2000-02 Chairman, Commission for Agricultural Costs and Prices, Govt. of India 1997-2000 Member, State Planning Boards of West Bengal and Tripura Chairman, Tenth Plan Subgroup on Agricultural Economics and Rural Development, Planning Commission, government of India, 2001 Member, Prime Minister's Task Force on Agriculture and WTO, Government of India, 2000-01 Member, Expert Committee on Rural Credit, NABARD, 1999-01 Prof. Sen has also been Adviser/Consultant with International organisations, such as the United Nations Development Programme, New York; International Labour Organisation, Geneva; Food and Agricultural Organisation of the United Nations, Rome; OECD Development Centre, Paris; the UN University World Institute of Development Research, Helsinki; International Fund for Agricultural Development, Rome; Asian Development Bank, Manila. Prof. Sen has authored /Co-authored more than 30 papers in the areas of: Agriculture, Employment, Economic Reforms and Poverty
[4] Sitaram Yechury was born on August 12, 1952. After school education in Hyderabad, Andhra Pradesh, he had to move to Delhi due to disruption of academic life as a result of the separate Telengana movement in 1969. At Delhi, in 1970 he completed Higher Secondary (one Year Course) standing first in the All India merit list. In 1973, he completed B.A.(Hons) in Economics, first class, from St. Stephen's College, Delhi University. In 1975, he completed M.A., first class, in Economics, from Jawaharlal Nehru University (JNU), Delhi. Subsequently, he joined JNU for a Ph.D. degree which he could not complete due to his arrest during Emergency. He joined Students Federation of India (SFI) in 1974, while at JNU. He joined the CPI (M) in 1975. He was underground for sometime, organising resistance to Emergency, before his arrest in 1975. After Emergency, he was elected as President of JNU Students' Union thrice during one year (1977-78). In 1978, he was elected as SFI's All India Joint Secretary. He left SFI as its President in 1986. In 1984, he was invited to the Central Committee of the CPI (M). He was elected to the Central Committee in the CPI (M) XII Congress in 1985, to the Central Secretariat at the XIII Congress in 1988 and to the Polit Bureau at the XIV Congress in 1992. He is currently a member of the Polit Bureau, Head of the International Department and Editor of the CPI (M) Central Weekly, Peoples' Democracy.
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