India asks Bush to take a hike

[fineleg]

News on "food blame" is old, but a video: [ame=http://www.youtube.com/watch?v=-AKdPIjVuDw]YouTube - Bush Blames India for Rising Food Costs ![/ame]

[Desi Cartman]

huh OTT video ...Im not an economist but I dont think Bush blamed India in that way ... I think he meant that as developing nations China and India have created more demand from food to fuel. PS: Bush is an idiot anyway

[Rajiv]

Bush must have been to those extravagant Delhi weddings, the buffet had oil and food mixed to the core..

[THX_1138]

Lets get some perspective on things shall we? Bush did not say that India ought to starve itself to death so that Americans might enjoy a hearty meal, he suggested that we consume less (which usually suggests, waste less) however, the hypocricy however is that the American way of life, the so called "american dream" of steak and mashed potatoes every day is one of the reasons why food prices are sky rocketing. It takes about 16 pounds of grain to yield 1 pound of meat. Not to mention the other effect of carbon footprint. the impact of a vegetarian is less than a third of the impact of a non vegetarian. So yeah, maybe Bush ought to suggest to his general population: look here, eat your veggies instead of your burgers. Of course, he would have to lead from the front which he does not. However, looking into the mirror, a majority of posters on this site, and particular my predecessors in this very thread are guilty of the same crime: non vegetarianism. So lets reform ourselves before blaming the Americans for everything. True, they are not saint, but they are not the only sinners. there is enough blame to go around the table. Moreover, it is a significant failure on part of our government that we are unable to introduce land reform and in particular infrastructure for the farmers. On one side we have gleaming cities with buzzing computers and on the other hand, we are still pittifully dependent on the monsoons for irrigation!

[CC1981]

Moreover, it is a significant failure on part of our government that we are unable to introduce land reform and in particular infrastructure for the farmers.

What do you suggest that is workable solution ??!? I keep hearing (from here to BR-forum where people seriously whine about India-related issues) that our farm-productivity is 1/3rd of western nations and how we must improve it. All sorts of blame is assigned to the government and mismanagement, yet i have NEVER heard a workable solution. And i can't see how farm productivity can increase in India without a grassroot adoption of communism. For one, western farming is more productive because it is far more mechanized- however, western farmers on average, own 20x the land-size as Indian farmers do. Its one thing to go looking for a mechanized behemoth that will increase your productivity when you got 1000 acres of land to put as collateral. Its quite another when your average farmer owns a 2 acre land as in India... with Indian farm-lots being micro-sized, how is Indian agriculture industry going to mechanize itself more ? at the end of the day, you need serious cash to buy those machinery...something Indian farmers neither has,nor can he hedge with his tiny land ownings. The American model of agriculture is vastly different from Indian model- what happened there is that white guys got huge pieces of land given to them by the government, told that they should 'go farm and spread forth', then got supplied by black slaves to do the work...which they eventually replaced by mechanized units. Whereas in India, the whole concept for thousands of years has been a farmer having a couple of acres of land, enough to feed his family and give some grain to the govt and thats that. Europe had much the same model as above, with land being owned by mostly nobility and the bottom class working at near-slave wages for the numerically few farmers...and Europe got to 'reset' their landscape after WWII- when land was re-assigned and the farming population fell hugely, so that the population dependent on farming is replaced by mechanization (not to mention, 90-odd million dead in 5 years leaves a lot less congestion). Apart from the white world, the only exception to the India-style farming is China, which essentially went communist and now the communes would collectively own the mechanized units, the land and split the gains evenly. This is unimplimentable in India as of now, with differing farm size, differing farming budgets of individual farmers and corruption. For two, half of India's food harvested rots before it gets to the dinner table...why ? because India doesnt have fleets of air-conditioned transport trucks that will zoom off making deliveries the moment the stuff is harvested, keeping it chilled and thus increasing its shelf-life. And neither is that kind of transportational cost affordable in Indian economy today. I am curious to know what exactly are the ideas to improve the state of affairs for our farming populace...anyone ?

[Lurker]

I am curious to know what exactly are the ideas to improve the state of affairs for our farming populace...anyone ?

Rather simple, if you ask me. The issue of farming is no different from any other economic issue really. Just as I have gripe with every Indian state falling over each other in pursuit of "IT revolution" similarly I have issues with every Indian state falling over each other to grow "cash crops". I mean how many Bangalores does India need anyway? Look around the country and you have atleast half a dozen such cities - Bangalore, Hyderabad, Chennai, Delhi(Noida, Gurgaon sattelite towns included), Poona not to mention small players like Cuttack, Calicut, Secundarabad, Chandigarh etc etc. In a nutshell it has been told to Indian people, and companies, that the ONLY way for India to move forward is IT. Which is of course truckload of cr@p. Not to mention that it based India's economy rather alarmingly on one sector and heaven save our butt if this sector tanks worldwide. Similarly with foodgrain productions. We have two major problems - limited land and huge population. At the same time we also have an assett - productive land. Indian land is often very productive and so we are able to grow a lot more in our limited area and hence we have always had a big population even thousands of years ago. What India needs to tacitly do is to make sure a balance is stuck in what is grown in this land. A very recent phenomenon is every farmer growing cash crops. Really cant blame him, after all everyone looks after his interest. But what happens because of this is how the price of everyday crops hits the roofs. Have you seen the price of veggies in big towns for example?? To develop Indian foodgrains India will have to think of the problem from a farmer perspective. Alas in today's India farmer and villages are nothing less than a slang. Heck if you have to rebuke a NRI all you have to mention is how he is a freshman from a village(incidentally this is true for across the border as well where Pind(village) is almost an abuse these days)

[CC1981]

Well said. I am not strong in economics, so i am kind of speculating here- but given Indian farmer's propensity for cash-crops and how food grains have hit through the roof, would it not mean some farmers are going to switch back to food-grains ? or is the price gap so huge between cash and food grains ? Another aspect to consider is that western countries+ Japan/China have been seriously subsidizing their farm industry while India's farmers re essentially being debt-crushed and the system is working against them. But this will perhaps come with India's further economic growth. Regarding your rants against IT-focus in India, i couldn't agree more, though the field is a bit wider than you think- India is doing quite well in medical research (though medical reach remains abysmal in society), India is a medical and medicine related giant- out here in Canada/Europe, it is starting to get a lot of positive feedback and is being noted for its excellence. One key area IMO to watch over the next few years is developments in India's defence industry. India is kind of going the german way of military-down industrialization, where it is in the hunt to procure high level military technology in bulk (when you are putting an APB for something as huge as a nuclear sub or cutting edge destroyers, planes,missiles,etc. you are buying a lot of high tech stuff that have huge commercial applications. Given that India is in the process of massively upgrading its production capabilities, India is likely to have the means to produce high end goods (cars, planes,trains,digital gyzmos,etc.) in decent quantities. And lastly, population- i think most old-timers know about my fatalistic view about India's population but let me rant once again: Yes, we had a high population by ancient world's standards- wikipedia cites that a census from Ashoka's time ( roughly 270BC) had the subcontinent's population at 150 million. Mind you, Ashoka's census is practically encompassing most of India,Pakistan,Nepal,Bangladesh,Pakistan and Afghanistan in its bounds, with only the southern-most tip of India missing out + extreme north-east missing out, etc., so the census is a good barometer for an idea how big Indian society was in ancient times. Now, fast forward to 1900s and essentially the same area minus afghanisthan(British India) had a population of 200-220 million. This was just 100 years ago. In 2200 years, our population more or less swelled by 50-60 million. But in the next 108 years, it has swelled to around 1.4 - 1.5 billion. Thats insane ! Sure, we can say that the world's population as a whole has gone up insanely too in the last 200 years or so. But show me a place in the world who's land has had to carry litereally 7-8 times the burden in just over 100 years. India's population is seriously a cause of concern and we keep adding 20-odd million people every year ! That is entire Australia added every year. Meanwhile, due to sick overpopulation, our kids get malnourished,lot of them grow up with dog-eat-dog mentality and most population is malnourished by modern standards. Yes, we can all gripe about how much the bloody yanks eat and how bloody fat they are, but lets not kid ourselves here- America can easily field 5x the number of fit people despite being under 3x the population of India.Something is clearly wrong here. I am beginning to toy with the idea if it is India's turn to try a one child policy that we have to keep up for the next few centuries- if we are to achieve our goal of being fit, well nourished nation that is self-reliant for food, we seriously cannot have more than 500-600 million people in the whole subcontinent. I am not suggesting a brutal Chinese regime of murdering babies, i am talking about providing incentives for having less babies and making those incentives mean something. Say like if you have one kid, when you retire, your pension would be 50% more than what it is today. If you have 2 kids, it would mean 25% extra, 3 or more and it heads to the negetive margin. Delay the law comming into effect for 2-3 years to give society some time to adjust. This surely will make a difference in slowing our insane population crisis. Ofcourse, having gotten some idea about the sick kind of politics population dynamics play in the subcontinent, especially with the hindu-muslim angle, not to mention, the angle of national sovereignty/competence, etc., i am resigned to India's population time-bomb just exploding in a massively bad way that will be our fourth panipat.

[Lurker]

I am not strong in economics, so i am kind of speculating here- but given Indian farmer's propensity for cash-crops and how food grains have hit through the roof, would it not mean some farmers are going to switch back to food-grains ? or is the price gap so huge between cash and food grains ?

Not really. The way I look at food grains vis a vis cash crops is that generally speaking Indian farmers used to put more emphasis on food grains and lot less on cash crops(peanuts, veggies etc). With the huge demand for cash crops(and less so for food grains), combined with development in transportation, communications etc means farmers tasted blood so to speak. Case in point Bihar agro. Bihar supposedly is the richest state in terms of vegetable cultivation, specially green leafy vegetables. Even today at Gaya you can buy a large cauliflower for 4-5 Rs, you will get the same in Delhi and Bombay for 40-50 bucks. But with today's Reliance(and its kind) Supermarkets in Delhi such veggies are moving quickly to Delhi. So price of local veggies at Gaya has shot up too. What changed? Well the demand in bigger cities and means to reach there. This is no different than certain parts of Bengal(or Maharastra) where delicious mangoes are shipped to NRIs and local populace is unable to eat what they considered part of their culture. The farmers may grow enough food grains just to let their family survive, for other part of land they may switch completely to cash crops.

Regarding your rants against IT-focus in India, i couldn't agree more, though the field is a bit wider than you think- India is doing quite well in medical research (though medical reach remains abysmal in society), India is a medical and medicine related giant- out here in Canada/Europe, it is starting to get a lot of positive feedback and is being noted for its excellence.

True. Still the industry is very much in infancy. The other day there was an article at CNN-IBN where it was suggested that Indian medical tourism industry might net something like 1.2 billion USD by 2012. No pocket change of course but still not even 50% of what an Infy, Wipro, TCS show on their annual revenue board. That said this is one industry which if properly nurtured can easily outgrow every other industry we have. Indian Medical services are amongst the very best in the world, specially if one can afford it.

This was just 100 years ago. In 2200 years, our population more or less swelled by 50-60 million. But in the next 108 years, it has swelled to around 1.4 - 1.5 billion. Thats insane !

You know Indian population growth is something that intrigues me. yes we have grown very fast. Heck I have seen India's population double(from 60 odd crores) to what it is today right infront of my eyes. What confuses me is that on an average Indians today rarely have more than 2 kids, if that. So where is this population growth happening?

[THX_1138]

What do you suggest that is workable solution ??!? I keep hearing (from here to BR-forum where people seriously whine about India-related issues) that our farm-productivity is 1/3rd of western nations and how we must improve it. All sorts of blame is assigned to the government and mismanagement, yet i have NEVER heard a workable solution. And i can't see how farm productivity can increase in India without a grassroot adoption of communism. For one, western farming is more productive because it is far more mechanized- however, western farmers on average, own 20x the land-size as Indian farmers do. Its one thing to go looking for a mechanized behemoth that will increase your productivity when you got 1000 acres of land to put as collateral. Its quite another when your average farmer owns a 2 acre land as in India... with Indian farm-lots being micro-sized, how is Indian agriculture industry going to mechanize itself more ? at the end of the day, you need serious cash to buy those machinery...something Indian farmers neither has,nor can he hedge with his tiny land ownings. The American model of agriculture is vastly different from Indian model- what happened there is that white guys got huge pieces of land given to them by the government, told that they should 'go farm and spread forth', then got supplied by black slaves to do the work...which they eventually replaced by mechanized units. Whereas in India, the whole concept for thousands of years has been a farmer having a couple of acres of land, enough to feed his family and give some grain to the govt and thats that. Europe had much the same model as above, with land being owned by mostly nobility and the bottom class working at near-slave wages for the numerically few farmers...and Europe got to 'reset' their landscape after WWII- when land was re-assigned and the farming population fell hugely, so that the population dependent on farming is replaced by mechanization (not to mention, 90-odd million dead in 5 years leaves a lot less congestion). Apart from the white world, the only exception to the India-style farming is China, which essentially went communist and now the communes would collectively own the mechanized units, the land and split the gains evenly. This is unimplimentable in India as of now, with differing farm size, differing farming budgets of individual farmers and corruption. For two, half of India's food harvested rots before it gets to the dinner table...why ? because India doesnt have fleets of air-conditioned transport trucks that will zoom off making deliveries the moment the stuff is harvested, keeping it chilled and thus increasing its shelf-life. And neither is that kind of transportational cost affordable in Indian economy today. I am curious to know what exactly are the ideas to improve the state of affairs for our farming populace...anyone ?

hydroponic farming interest free loans eliminating the FICCI and permitting the farmers deal directly with the penultimate purchaser i.e. the companies that would later sell the grains to the end user better irrigation systems domestic manufacturing of fertilizers and pesticides that are current imported from dupont a rural education system for the next generation and urge the GAT members to remove the heavy subscidies they provide for their local farmers, especially united states. afterthought: localized distribution. we have a 100 billion dollars in surplus sure we can find something to do with it.

[fineleg]

From the Guardian: The problems with rice Why is there a problem now? The price of rice has reached record highs in recent months, moving from $327 a tonne a year ago to $1,000 a tonne last week. Yet there is no serious shortage of rice - global production and consumption are roughly in balance. Supply has been affected by floods in Bangladesh which forced it to buy more on the global markets than normal, and the cyclone in Burma will probably force it to do the same, but the UN's food and agriculture organisation says rice producers generally have not been not hit by large-scale climate shocks and supply and demand is not the main cause. Instead the cost of producing rice and transporting it has gone up as oil prices have risen, and this oil-driven inflation seems to be the underlying factor in the recent rice crisis. Rice differs from other agricultural commodities such as corn, wheat and soya, in that very little is traded internationally. Just 7% of the global harvest, about 30m tonnes a year, goes on to the world market, but precisely because the market is so thin, small shocks can lead to great volatility. Half the world's population, more than 3 billion people, depend on rice for their staple food, and it is one of the most politically sensitive of agricultural commodities. Several governments, worried by the political fallout from domestic inflation - in fuel, utility prices, and rent, not just food - have tried to mitigate against the effects by imposing controls on rice exports. In October 2007 India imposed price controls and then a full ban on its rice exports in an effort to keep prices of food, and overall inflation, down at home. Several other rice exporters followed, including Vietnam, Egypt, Pakistan and Cambodia. That led other countries which are big importers, such as the Philippines and Indonesia, to panic buy, driving up prices. Between January and April 2008, they surged by over 70%. Who has been hit? The major rice importing countries are in Africa, Asia and Central America. Africa accounts for 30% of the global rice imports, and Asia 45%. Among the hardest hit are West African countries such as Senegal, Nigeria, Ivory Coast, and Cameroon, where the population has shifted as it urbanises from the traditional staples of millet and cassava to eating rice. These countries became significant importers of rice, and more dependent on food imports generally, when they liberalised their agricultural markets as a condition of IMF/World Bank loans from the late 1970s onwards. Haiti, Mexico and Honduras, whose own agricultural markets and production have been undercut by subsidised US crops dumped when prices were low, are also suffering from the high prices. Senegal, Cameroon, Haiti and Mexico have all seen food riots. The Philippines and Indonesia are big producers of rice but as their populations have grown and yields stagnated they have needed to make up shortfalls with imports. Other big importers of rice include Iran, Iraq and Saudi Arabia, but since they also benefit from rising oil prices, rising food prices have not had such an effect. What will happen now? The FAO predicts good harvests this year which should bring prices down in the short term but not immediately - since some exporting countries still have bans in place until the summer or autumn. Experts are waiting to see what impact the Chinese earthquake has had on its capacity to produce rice. In the long-term they expect growing populations and growing economic demand to keep prices relatively high.