Rice

The Impact of India’s Food Security Policy on Domestic and International Rice Market

India has emerged as a leading rice exporter in the international market. Every year the Government of India has taken initiatives on changes in Food Security Policy according to the market demand.

Recently the Government of India has introduced a new policy that the National Food Security Act which requires 33.6 million tons of rice per year for its public distribution system.

Policy Makers from India are developing several policies for consistent food price value in the domestic as well as for the international market. They also ensure that the policies will not distort the market value and maintain food security in the domestic market.

Due to these policies, India’s rice export also plays a significant role in the international market.

Impact of NFSA on Indian Market Growth

India’s National Food Security Act generated much debate among Policy Makers. The policies that are released in the market can able to reduce poverty or hunger in the domestic market but unable to consistent growth in the international market.

The impact of NFSA has a negative impression on rice industry growth. It causes changes in rice consumption in India resulting in a decrease in the rice export growth.

Since rice is the major agricultural export commodity in India, so it has great value with a positive effect in the Indian market. Such a type of policy provides a negative impression on the global market.

The overall economy of India may be on downwards trends due to some complications in the market. There are some precautions should be taken by Policy Makers in India are as follows:

  • More Government revenue required to implement NFSA.
  • Policy Makers should consider indirect costs too.
  • The cash transfer program should be introduced instead of subsidy.

Other Policies in India

Foods Policies of India help to build some benefits around the world. Some of the benefits are discussed below:

  • Building Local capacity of the Nation.
  • Increasing Productivity.
  • Improving Markets and Trades.

FAO (Food and Agricultural Organization)

  • The policy was launched to reduce food insecurity in India. The policy ensures food security for poor and vulnerable people in the country who spend almost 60 percent of their expenditure on food. The policy not only related to the growth of poor people but it also ensures food security in the global market.

National Food Security Bill

  • In the year 2011, the NFSB was introduced in the market. The aim of the policy was that the legal rights of eligible beneficiaries to receive entitled quantities of foodgrains at highly subsidized prices. The enforcement law also deals with women, children, and other special groups such as emergency affected persons to receive the meal free of charge.

The implication of the policy was a massive procurement of food grains and a very large distribution network entailing huge financial expenditure.

Some of the complex obligations in the NFSB are as follows:

  • Complex procurement.
  • Rising of cost in operational expenditure.
  • Unstable infrastructural growth.
  • Inefficient governance.
  • A significant rise in the number of entitled beneficiaries.
  • Raising the Minimum Support Price (MSP).

Outlook

Indian Food Security Policy supports also Global Food Security Policy. It is important that not only it helps to reduce thousands of hungry people, but also to the sustainable economic growth of the Nation along with the long-term economic prosperity of India.

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