Relevance: GS-3: Issues of Food Security;
Key Phrases: comparative advantage; infant industry argument; Agri R&D; Amrit Kaal; invest at least 1% of its agri-GDP in agri-R&D;
Context
- The ongoing war between Russia and Ukraine has emphasised the need for India to be Atma nirbhar. This is true for various sectors - defence, agriculture and scientific achievements.
- For India to be successful in Amrit Kaal (next 25 years) it is imperative that it is self-reliant not just in missiles (defence equipment) but also in meals (food).
- As a former PM had said "Jai jawan, jai kisan, Jai Vigyan", focusing on science and scientists is critical for attaining self-reliance.
Key Highlights
- Self-reliance in food does not mean that we have to produce
everything ourselves at home, irrespective of the cost.
- Its true meaning lies in specialising in commodities in which we have a comparative advantage, export them, and import those in which we don't have a significant comparative advantage.
- Infant industry argument - Initial protection may be allowed to those industries which are greenfield, but only to some extent. The principle of comparative advantage must be followed
- But one should not aspire to be self-sufficient behind high tariff walls. That would only breed inefficient and high-cost structures that cannot compete globally.
Attaining Comparative Advantage
- In the area of agriculture and food, it is the efforts and resources
that a country puts in
- Agri-research and development (agri-R&D),
- Its extension from lab to land,
- Investing in irrigation to boost yields,
- Efficiency in marketing and
- Processing the produce, and taking it from farmers' fields to consumers' table or export destinations.
Status of Agri-R&D
- Agri R&D raises total factor productivity and makes agriculture more
competitive globally.
- Basic R&D to develop “miracle seeds" can be done outside the country which could be worked on by domestic labs and scaled up for adoption at farmers' fields.
- The Green Revolution was such a case.
- For India to be fully self-reliant in food, it must invest at least
1% of its agri-GDP in agri-R&D.
- But the budgets of both the Union government and the states put together reveal that this expenditure on agri-R&D and education hovers around 0.6% of agri-GDP, with a roughly equal share of the Centre and all states put together.
- India has achieved self-reliance in agriculture by producing a
reasonably large amount of food, and also being a net exporter of agri-produce.
- India imports 55-60% of Edible oil requirements, which is a concern
- The Economic Survey (2021-22) explicitly highlighted the
correlation between spending on agri-R&D and agricultural growth.
- For every rupee spent on
- Agri-R&D yields much better returns (11.2), compared to
- Fertiliser subsidy (0.88),
- Power subsidy (0.79), etc.
- Yet, the competitive populism in Indian democracy leads to
suboptimal choices in the allocation of scarce resources.
- More on safety nets like food subsidy and MGNREGA or on income support and subsidies for farmers, but very little for agri-R&D.
- For every rupee spent on
Challenge
- Budgetary expenditure (FY 23) is heavily tilted towards safety nets
and subsidies.
- India cannot develop cutting-edge technologies to attain competitiveness at a global level.
Way Forward
- Private sector come forward and help India attain supremacy in agri-R&D
and
- Global and local companies like Bayer, Syngenta, MAHYCO, Jain Irrigation, and Mahindra and Mahindra spend a considerable amount of their turnover on R&D programmes and developing high-tech inputs.
- The USP of these companies is that they develop technology
that increases productivity while addressing the current challenges of
- Limited net sown area,
- Depleting water resources,
- Vulnerability to climate change, and
- The need to produce nutrient-rich food.
- The need of the hour is to focus on increasing expenditure on agri R& D and other development projects, which can aid in the sustainable growth of the agriculture sector.
- India's budget allocations in the agri-food space should thrive
on creating "more from less".
- The financing should focus on altering the current atmosphere of a high incidence of hunger and malnutrition, keep a check on the mismanagement of natural resources and mitigate climate change issues.
- Build long-term sustainable solutions that have an aggressive approach to implementing relevant policies and developing new ones.
- The government should come out with policies that incentivise private companies to expand their R&D programmes and invest more financial resources on development projects, which have the potential to overcome the challenges of the current agrarian setup of India.
Source: Indian Express
Mains Question:
Q. How can India become Self-Reliant? Answer from the perspective of boosting Agri R&D.