There had been signs that an Opposition that has been sort of slothful over the previous year would finally get its act together and challenge the government on price rise during the current Parliament session. This came to pass yesterday, when both Houses were forced to adjourn over the issue. Without undermining the significance of the issue, one wishes that there was a more graceful way of stressing it than suspending work in a Budget session. It is, after all, not clear that those challenging the ruling coalition?s failure to check food prices would actually support the government if it really mustered up the nerve to move towards appropriate solutions. To illustrate, let?s take note of the Delhi CM reportedly ruing the vast gap separating wholesale and retail prices of vegetables in the capital. She further rued the difficulty of cracking the whip on the thousands of intermediaries between the farm and the final market. And as FE stories have tracked, high retail prices are not appropriately matched at the farm gates. But, what if India and its capital actually possessed a meaningfully modern retail system? Then, distribution middlemen wouldn?t be able to simultaneously hoodwink both farmers and consumers. Then, we would have more efficient supply chains that didn?t lose 35% of India?s horticultural output, not to mention 15% of its cereal and grains output. This would also mean wholeheartedly welcoming FDI and agriculture futures. Are the men and women who pushed for Parliament?s adjournment yesterday prepared to support such progressive measures?
These columns have repeatedly argued that a) the problem of rising food prices needs to be disaggregated and b) measures such as replacing ministers or bifurcating portfolios (the kind of measures that the Opposition is fond of demanding) do not really get to the heart of the problem. On the first front, consider, for example, that pulses exist in a different universe from vegetables. Here, there is a genuine supply issue, which is global in dimension. In sugar, the domestic economy is deeply distorted by government interventions ranging from fixing procurement prices to allocating distribution. Again, it?s hard to see the Opposition actually stepping back from the right to such interventions. And again, the solution really lies in repairing the breach between the farmer and the consumer, even on a global scale. Last year?s monsoon turned out to be more benign than what the doomsayers had suggested. Now, the rabi harvest is looking good. Even in cases where supply issues dominate, and say yields need to be upped in the long term, quick fixes will not be the best fixes. Both the government and the Opposition need to focus on structural issues.
