{"id":242426,"date":"2023-05-15T20:13:49","date_gmt":"2023-05-15T14:43:49","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=242426"},"modified":"2023-05-15T20:13:49","modified_gmt":"2023-05-15T14:43:49","slug":"how-to-weather-proof-food-security","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/how-to-weather-proof-food-security\/","title":{"rendered":"How to weather-proof food security"},"content":{"rendered":"\n

Source-<\/strong> The post is based on the article \u201cHow to weather-proof food security\u201d published in \u201cThe Hindu\u201d on 15th May 2023.<\/p>\n

Syllabus: <\/strong>GS 3- Indian economy \u2013 Pricing and inflation<\/p>\n

News <\/strong>– There is a degree of comfort in the corridors of the Reserve Bank of India (RBI) as the consumer price index (CPI) inflation figure for April 2023 slid to 4.7 percent<\/strong>, and food price inflation has fallen to even lower, 3.84 percent.<\/p>\n

What is the inflation scenario of the country?<\/strong><\/h2>\n

The food and beverages component<\/strong> in the Indian CPI has a weightage of 45.86%. Managing this component to around 4% is critical to control overall inflation.<\/p>\n

This component of inflation cannot be managed only through monetary policy,<\/strong> nor even by fiscal policy<\/strong>. It is often triggered by external shocks,<\/strong> such as droughts and breakdown of supply chains.<\/p>\n

There is a possibility of El Nino,<\/strong> and it could cause below-normal rainfall, even a drought. All droughts since 1947 have been El Nino years, but all El Nino years are not necessarily drought years. IMD’s revised forecast about the monsoon will clear the picture.<\/p>\n

The unseasonal rains<\/strong> are also not good for agriculture.<\/p>\n

The biggest crop of the kharif season is rice. Rice inflation<\/strong> for April was 11.4% Wheat inflation is still very high at 15.5%. The overall cereal and products inflation<\/strong> is still at an uncomfortable level of 13.7%.<\/p>\n

There is a concern about milk and milk products.<\/strong> Inflation in this category in is also high. It has the highest contributions amongst all commodities.<\/p>\n

Experts give two reasons for this inflation. Lumpy skin diseas<\/strong>e had its impact. The milk production growth rate collapsed to almost zero in FY23.<\/p>\n

The fodder price inflation<\/strong> has been very high, between 20 and 30%, in recent months. Both these factors have been straining milk prices. These are not likely to come down this fiscal in the business-as-usual scenario.<\/p>\n

How high inflation in rice and wheat can be easily managed by the government?<\/strong><\/h2>\n

More than 800 million people are getting free rice and wheat under the PM-Garib Kalyan Yojana<\/strong>. So, they are well protected from cereal inflation.<\/p>\n

The rice stocks with the FCI <\/strong>are more than three times the buffer stock norms<\/strong> for rice.<\/p>\n

If the government wants to control rice price inflation, it can unload 5 million tonnes of rice from the Central Pool in open market operations<\/strong>, and easily bring down the rice inflation to around 4%.<\/p>\n

What is the way forward to control the food and beverages inflation?<\/strong><\/h2>\n

There is a need to focus on cereal and milk inflation. <\/strong>Both have high weights in CPI<\/strong>. The policy instruments<\/strong> to keep their inflation around 4% are the buffer stocking policy and import policy.<\/strong><\/p>\n

There is a need to lower import duties<\/strong> on fat and skimmed milk. These are currently at 40% for fat and 60% for skimmed milk powder. Indian prices of SMP and fat are much higher than the global prices. That could help in reining milk and milk product prices.<\/p>\n

These policy actions must be pre-emptive in nature and not reactive<\/strong> to the event. There is a lag of two to three months for these policy actions to show their results.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source- The post is based on the article \u201cHow to weather-proof food security\u201d published in \u201cThe Hindu\u201d on 15th May 2023. Syllabus: GS 3- Indian economy \u2013 Pricing and inflation News – There is a degree of comfort in the corridors of the Reserve Bank of India (RBI) as the consumer price index (CPI) inflation… Continue reading How to weather-proof food security<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10498],"class_list":["post-242426","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-the-hindu","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/242426","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=242426"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/242426\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=242426"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=242426"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=242426"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}