Agriculture and food security Himanshu

Agrarian Revival since 2005 Signs of revival since after the worst agrarian crisis during Agricultural growth rate picked up: more than 3% after Agricultural investment picked up Agricultural credit doubled Good monsoon TOT moving in favour of agriculture

Worrying trends since 2009 Growth slowed down, less than 0.5% during and Partly drought but are there structural issues Not so clear at this stage due to lack of data Cost of cultivation has gone up sharply Terms of trade have started moving against agriculture stagnation in agriculture credit off-take Environmental factors

Food grains TOT is declining

International food prices are also declining

Cost of cultivation has gone up

Cash cost is increasing since 2009, mainly labour, diesel and fertiliser

Fertiliser capacity has remained stagnant

Imports have increased. Introduction of NBS

Impact of NBS: distortion in prices Kharif 2010Kharif 2011 Nitrogen Phosphorous Potassium N:P:K Ratio4.44:2.57:110.78:4.93:1

Was the revival real? The movement in TOT was led by increase in MSP and speculative activity Not enough evidence of this being demand led Rural demand growth due to NREGA etc appears to be exaggerated Food price inflation: structural, speculation

What to expect in future Urea prices likely to be increased Diesel prices likely to be increasing Unlikely that demand increases domestically or internationally International prices likely to stay low Fear of high fiscal deficits likely to put pressure on agricultural investments as well as food, fertiliser and other subsidies

Food security Malnutrition situation is not showing any signs of significant improvements Hungama report (2011) confirms the severity of the malnutrition problem some inference on the basis of calorie intake data The decline in calorie intake between has been the worst The Myth of diet diversification

Calorie Intake from NSSO RuralUrban