News / Economy

As India Passes Food Bill, Worries Over Cost

Indian vendors arrange grain for display at their shop in Kolkata, August 26, 2013.
Indian vendors arrange grain for display at their shop in Kolkata, August 26, 2013.
TEXT SIZE - +
Anjana Pasricha
— India’s finance minister said the country can afford a massive new government program to provide two-thirds of the country’s population with cheap food. It has been billed as the world’s biggest program to fight hunger, but there are fears it may further strain India’s weakening economy.     
 
A day after the lower house of parliament approved a historic bill to provide heavily subsidized wheat and rice to nearly 800 million people, Finance Minister P. Chidambaram said the government has budgeted for the ambitious program.
 
The Food Security Bill was passed late Monday after an impassioned plea by the head of the ruling Congress Party, Sonia Gandhi.
 
Sonia Gandhi told legislators it is not a question of how we find means to implement the food bill, we have to find the way. She said it will transform the lives of tens of millions of people.
                                              
The bill will become law after it is approved by the upper house later this week.
 
It will dramatically expand an existing food subsidy program that covers about 200 million people. The government hopes it will wipe out hunger in a country where malnutrition is widespread. According to the United Nations, India is home to one quarter of the world’s hungry people.   
 
But the main worries center around the program’s huge cost: an estimated $20 billion every year.
 
The central bank has already warned that increased public spending on implementing the food bill could deepen the government's deficit and stoke inflation.
 
Amid such concerns, stock markets plunged Tuesday and the already weakening rupee hit a new record low against the dollar.  
 
That prompted assurances from Finance Minister Chidambaram, who said India can absorb the massive cost of the food security bill. He said the budget deficit will be controlled despite the added burden. 

“We are now on a path of fiscal consolidation. We have some of the best advisers, best economic minds in the world. We will contain the current account deficit, so why doubt our capacity,” said Chidambaram.
 
Opposition parties have supported the food bill, but slammed it as a program meant to gather public support ahead of national elections next year. Murli Manohar Joshi is a senior leader of the main opposition Bharatiya Janata Party.
 
“This is an inadequate bill, this is a vote security bill, it does not mean anything about food security,” said Joshi.
 
Populist programs meant to attract voters are not new. In the run up to the last two general elections, the Congress Party passed a massive rural jobs plan and waived farm loans worth billions of dollars.

You May Like

Multimedia Relatives of South Korean Ferry Victims Fire at Authorities

46 people are confirmed dead, but some 250 remain trapped inside sunken ferry More

War Legacy Haunts Vietnam, US Relations

$84 million project aims to clean up soil contaminated by Agent Orange More

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

This forum has been closed.
Comment Sorting
Comments
     
by: Gis from: Mumbai
August 30, 2013 2:49 AM
I really think the government have to take drastic measures to put a stall to increasing of population of people who cannot make 3 times meals.IT is high time to implement strong population control measures rather than just giving food at cheaper price to the gorwing undernurished people!

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Ukraine, Russia, United in Faith, Divided in Politicsi
X
Michael Eckels
April 19, 2014
There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Ukraine, Russia, United in Faith, Divided in Politics

There is a strong historical religious connection between Russia and Ukraine. But what role is religion playing in the current conflict? In the run-up to Easter, Michael Eckels in Moscow reports for VOA.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.