Although you are going to study management, MBA institutes expect that you know whats happening in the Lok Sabha and the Rajya Sabha, as anything that the government does, any new bill that the parliament passes affects the corporate world and can rock the stock exchange upside down.
You are expected to know the major new bills passed and one of the major ones this year was the “National Food Security Bill”.
For this topic, it’s very important you know what the Bill is all about. Here is a run through of the Bill. Know these and you know the Bill. You know the bill and you can make your own points.
The Indian National Food Security Act, 2013 (also Right to Food Act), was signed into law September 12, 2013. Main points are :
- 75% of rural and 50% of the urban population are entitled for three years from enactment to five kg food grains per month at Rs.3 (4.6¢ US), Rs.2 (3.1¢ US), Rs.1 (1.5¢ US) per kg for rice, wheat and coarse grains (millet), respectively.
- The states are responsible for determining eligibility.
- Pregnant women and lactating mothers are entitled to a nutritious “take home ration” of 600 Calories and a maternity benefit of at least Rs 6,000 for six months.
- Children 6 months to 14 years of age are to receive free hot meals or “take home rations”.
- The central government will provide funds to states in case of short supplies of food grains.
- The current food grain allocation of the states will be protected by the central government for at least six months.
- The state government will provide a food security allowance to the beneficiaries in case of non-supply of food grains.
- The Public Distribution System is to be reformed.
- The eldest woman in the household, 18 years or above, is the head of the household for the issuance of the ration card.
- There will be state- and district-level redress mechanisms, and
- State Food Commissions will be formed for implementation and monitoring of the provisions of the Act.
POINTS IN FAVOUR:
- More power to BPL families : A CRISIL Report published on April 29 2013 believes the proper implementation of the Bill “will lower spending on foodgrains by below poverty line households, and free up resources for spending on other goods and services, in particular health, education, and nutritious food.
- Better Nutrition Intake : The Bill enables an additional savings of around Rs 4,400 this year for each BPL household that begins to purchase subsidized food. This savings equals around 8 per cent and 5 per cent of the annual expenditure of a rural and urban household, respectively. For rural households the savings amount exceeds their current annual medical and educational spends. Higher disposable income would also allow BPL households to spend more on protein-rich food, thereby improving their nutritional intake.
- Better Redressal Mechanism : The Bill states that there will be state and district level redressal mechanism with designated nodal officers. Redressal mechanism may also include call centers, helpline etc. The Bill provides for penalty to be imposed on public servants or authority, if found guilty of failing to comply with the relief recommended by the District Grievance Redressal Officer. This Bill is great opportunity to reform the PDS loopholes in India.
- Women and Children Considered : It’s a giant leap ahead in empowering the weaker sections of the society. According to the Bill, the eldest woman in the household, 18 years or above, is the head of the household for the issuance of the ration card. Pregnant women and lactating mothers are entitled to a nutritious “take home ration” of 600 Calories and a maternity benefit of at least Rs 6,000 for six months. Moreover, Children 6 months to 14 years of age are to receive free hot meals or “take home rations”.
- Inefficient Distribution Channels : The beneficiaries do not stand to gain as about 40 percent of rice and wheat earmarked for the poor gets siphoned off due to corruption. An inefficient distribution channel also leads to waste.
- Discourage Agriculture : Many agriculture experts believe that Food Bill which proposes to provide grains to people at very cheap rates may discourage the agriculture production in the country. Hence it must make sure that farmers should not be burdened at all with the cost of subsidizing the supply. Even a little burden can cause a large number of farmer suicides. Also, Small farmers may shift to other crops, as they will get the subsidized food grains. This will reduce the production of food grains.
- Meet fiscal deficit target : Economists have raised concerns about the cost to the exchequer at a time when the government is struggling to bridge the fiscal and current account deficits. Fitch Ratings has said it was getting more challenging for India to meet its fiscal deficit target in the current fiscal year ending March 2014 with revenues slowing. Economists of the Government’s Commission for Agricultural Costs and Prices (CACP), who define the roadmap of agricultural policies, have calculated “additional” subsidy burden of Rs 1.20 lakh crore per annum from the existing Rs 90,000 crore.
- Storage Issues : The Centre intends to delegate the task of construction of additional storage to the states, which may not be practically feasible given constrained centre-state relations among diverse political parties. The government does not even have enough storage capacity to store the amount of grain that it currently procures and will have to procure from the farmers in the years to come. So more grains could be dumped in the open and will rot as a result.
- Political Reason: It won’t be totally unfair to say that the rush to pass the bill implies the intent is nakedly political, with the nearing elections and a motive to preserve the vote bank.
The Food Security Bill has great measures to tackle the issue of malnutrition and hunger in India. But the key to accruing all these benefits is the proper implementation. “While the benefits of the Bill could go well beyond just the provision of food, the success of the scheme and its welfare impact lies in identifying the poor and making sure that they are able to avail the food subsidy
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