Friday, January 20, 2012
Food security plays an important role in social and political stability of a country. But sustaining agricultural growth and food security is a challenge for the present day world, especially for developing countries. Climate change and disasters aggravate the risk further. International organisations are warning about hunger and food insecurity risks in many countries. In this context, the Bangladesh government is considering the issue with utmost priority because Bangladesh is one of the most disaster prone countries of the world. The disaster-hit people need emergency food assistance, as their capacity to access to markets falls drastically. Increasing population, poverty (31.5% of the population is still poor), decreasing availability of land resources and seasonal umemployment in agriculture sector compound the problems. Thus, ensuring food security and effective disaster management are the two enormous challenges for the government.
The country saw unprecedented agricultural growth during the Awami League government in 1996-2001. This was possible due to pragmatic plans and effective implementation by the then government of Sheikh Hasina. The country became cereal surplus for the first time in 1999-2000. Food grain production rose from 19 million MT in 1996 to 26.9 million MT in 2000-2001. That, a rise of about 8 million MT in five years, was almost equal to the achievements in the previous 25 years (1971-1996). Agricultural growth was 8.10% and 6.18 % in 1999-2000 and 2000-2001 respectively. Prime Minister Sheikh Hasina was awarded the prestigious CERES Award by FAO for the country’s unprecedented success in agriculture production and food management.
But the growth trend did not sustain during BNP’s regime in 2001-2006. They did not fulfil their commitments to the people and there was severe mismanagement in procurement and distribution of agricultural inputs like fertilizers, seeds, diesel etc. The average agricultural growth came down below 3.5%. The BNP government did not buildup sufficient public stock to face any food crisis. Consequently, the country’s food security fell to an all-time critical level in 2007 and 2008, compounded by the global food crisis during the rule of the caretaker government.
International prices of rice price rose from $301 per MT in 2006-07 to $665 per MT in 2008-09. This, along with other failures, resulted in domestic price increase of Tk.35-50 per kilogram. Wheat price also increased similarly during this period. In this situation, the present government took office on January 9, 2009 with the pledge to bring down the prices to an acceptable level.
Pledge and renewed focus on food security
The present government had to start with the residual shocks and impacts of the 2007-08 food crisis. In addition to this, cyclone Aila hit south-west Bangladesh on May 25, 2009. It caused huge damage in agriculture production and water infrastructure along the coastline. The government, therefore, opted for augmenting production and took up massive programmes. It halved the prices of non-urea fertilizers, made quality seeds available, increased subsidy on inputs including diesel, and eased the credit provisions. Thus, agriculture production growth bounced back from 3.5% to 4.5%. In the last two years, the growth increased further. The government has also maintained conducive output prices for the farmers. Market monitoring has also been strengthened to procure food grain after harvest.
International support for improving food security
After assumption of office, the present government launched the National Food Policy Action Plan (2008-2015) and initiated formulation of the Country Investment Plan for Food Security (2011-2015). This plan consists of 12 programmes for improving availability of, access to, and utilisation of food with an involvement of $7.8 billion, of which $5 billion need to be mobilised. The Asia-Pacific Food Security Investment Forum held in Manila in July 2010 and the 36th session of the Committee on World Food Security held in Rome in October 2010 honoured Bangladesh as a “showcase country” for this unique policy planning framework. This Plan has thus opened the window for international support for food security in the country.
Initiative for enhancing access to food for the poor
Delivering food to the poor through the Public Food Distribution System (PFDS) is the main strategy for ensuring food security for the poor. The government has taken initiatives to enhance the coverage and effectiveness of social safety-net programmes. As a result, the overall distribution under PFDS in 2010-2011 stood at over 2.29 million MT as compared to 1.25 million MT in 2005-06. Accordingly, the allocation to safety-net as percent of GDP increased from its earlier 1.6% to 2.5-2.6% in recent years. Allocation to safety-nets as percent of public expenditure also increased from 12.5% in 2006-07 to 17% in 2010-11.
Stabilizing food grain prices
With the global food crisis and export restrictions by major exporting countries, the price increased by 62% between January 2007 and January 2008. The rice prices again shot up in February 2010 and remained stable until mid-2010, after which it started increasing until February 2011. In view of the uncertainty of commercial import, the government also decided to go for import through G2G contracts. The quantity of public import in 2010-2011 stood at 2.2 million MT, of which about 0.75 million MT was imported from Thailand and Vietnam under G2G contracts. The total food grain import in 2010-11 thus stood at about 5.3 million MT. The government also had to respond with measures to intervene in the market to protect the poor from cartels formed by unscrupulous traders. The government started distributing 20 kg of rice per month to each household at subsidised price. The total OMS and FPC distribution in 2010-11 alone was 1.2 million MT, of which 0.86 million MT was distributed under OMS, which is a record in the history of OMS. In order to stabilize prices, flour was also distributed through OMS and its price has stabilised to a great extent. Not only did the government efforts overcome the crisis, they also kept the prices below those of other developing countries. For example, in October 2011 prices of rice and wheat in Bangladesh were lower than other developing countries. (see Table-1)
Special programmes for addressing regional and seasonal food insecurity (Monga)
To prevent monga in the north-west during September to October and March to April, and to alleviate the unemployment in lean seasons throughout the country, the government has been implementing Employment Generation Programme (EGPP) for the hardcore poor. This included Aila affected people of 11 coastal districts and 5 monga affected districts of greater Rangpur. In 2010-11, the EGPP budget was increased to Tk.1,000 crore and 0.855 million people were thus benefited. In addition to EGPP, the government introduced short duration and drought resistant rice variety and revitalised horticulture programmes. This has resulted in increase in income, downsized the lean period and reduced the cost of food basket for the poor people.
The last 20 years’ trend of daily household income and wage can be seen in Table-2
The above table shows a 3.5-fold increase in income and about 2.5-fold increase in rice equivalent of wage over the last 20 years. During the BNP regime in 1995-96, the poor people could buy 3.45 kilograms of rice with their daily wage, which has increased to 8 kilograms during the time of the present government, the highest in the history of real labour wage in the country. This also indicates significant improvement in access to food of the poor people. Not only that, rural focus of programmes has increased poor people’s income, and have helped speed up the rural economy as well.
Increased Public Storage Capacity for 160 million people
At present, the government storage capacity is 1.5 million MT, which is inadequate on four major counts: increasing population, increasing frequency and intensity of disasters, upward need for price incentives to the farmers through domestic procurement and enhanced coverage of safety-nets. Therefore, the government has made massive efforts to raise the storage capacity. The storage capacity has already been increased to 1.7 million MT by repair and rehabilitation of existing godowns and construction new storage of 120 thousand MT capacity. Moreover, 280 thousand MT capacity storage construction projects are awaiting final approval.
Efficient public stock management: Record stock at hand
Taking lessons from the past, the present government has responded to the price shocks, among others, by increasing PFDS stock level. Since 2001/02, average stock largely exhibited a declining trend, averaging 0.82 million MT from 2001/02 through 2008/09. But with the rise in distribution need in the face of food price volatility, the government raised the stock to about 1.5 million MT in October 2011 (even after the record distribution in 2010-11) more than double as compared to the stock in October 2006. Effective measures for G2G import and success in the last boro rice procurement have helped raising the stock to such record level. Efforts are ongoing to domestically procure 200 thousand MT of aman rice and import of 300 thousand MT of wheat.
The present government’s commitment to ensure food security has been amply reflected through actions taken in the last three years. Despite global uncertainty in supply and price instability, the government has been successful in managing the shock; especially the shocks on the poor were greatly reduced. Monga is no longer a threat. The production of food grain has been increased to a satisfactory level. What is required is to sustain this growth trend. This necessitates technological innovations and research in agriculture, and development of climatic stress tolerant crop varieties. If we can mobilise support from all, the day is not far when we will become a middle-income country as envisaged in our Vision 2021.
The writer is Minister for Food and Disaster Management, Government of Bangladesh.