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Posts Tagged ‘food price inflation

India’s onion panic

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The swings and spikes of the Maratha onion. The red line is the price per quintal, which is on the scale to the right. The quantities are in tons, on the scale to the left. Both price and quantity are for onions in Maharashtra, for the period 2006 to 2013 June. The data is from the National Horticulture Mission.

The monthly swings, spikes and tears of the Maratha onion. The red line is the price per quintal, which is on the scale to the right. The quantities are in tons, on the scale to the left. Both price and quantity are for onions in Maharashtra, for the period 2006 to 2013 June. The data is from the National Horticulture Mission.

We onion eaters shudder when we remember the annus horribilis of 2010, when onion prices rose to a monthly average of about Rs 2,400 a quintal (that’s 100 kilograms).

Now, our familiar red allium cepa is lightening our slim purses by 70 rupees for a kilo. Will the rest of 2013 turn out to be another onion-scarce quarter? I should hope not. The chart tells us that the price peak of 2010 accompanied a dreadful shortfall in the supply of the pungent stuff, but surely, the low supply levels of mid-2008 and late 2007 were even more severe, as my chart tells us.

More worrying is the upward flight of that red line in this last month, which is now at or around a level second only to the peak of 2010.

The popular press hasn’t noticed the curious trend (perhaps editors and reporters nowadays must consume far too much pizza, pasta, cola, burgers and so on, untutored in the ways of the jowari roti, the one-half of a juicy red onion, and a handful of ‘lasanyache chutney’, as one says in Marathi, which is the unforgettable district staple of chutney made from ground garlic, red chillies and coconut; more the losers they then.)

Business Today has reported that “industry experts are perplexed by the trend” of the rise in onion prices (what’s their expertise worth I wonder), the Business Line warned that “after racing ahead of the rupee, onion could turn costlier than petrol”, the New Indian Express found Food Minister K V Thomas doing his bit to calm the nation by saying that “there’s no cause for panic”, and the Business Standard’s reporter in Lasalgaon, in the district of Nashik in Maharashtra, which is reckoned to be Asia’s largest onion market, nearly fainted away when the price shot up to Rs 5,300 a quintal.

Written by makanaka

September 18, 2013 at 11:29

Why India is ruled for its cities

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RG_urbanisation_Agenda_issue_201308Over the period 2010-20, urban India is expected to create 70% of all new jobs in India and these urban jobs will be twice as productive as equivalent jobs in the rural sector, according to ‘India’s Urban Awakening: Building Inclusive Cities, Sustaining Economic Growth’, a report by the McKinsey Global Institute in early 2010.

This material produced by a consulting company has alas become the authoritative reference for India’s central ministries and planners; but McKinsey’s slanted and misguided output is well suited to fulfil the GDP growth mania of the ruling oligarchies and their banking and corporate accomplices. Nonetheless, adopting the tone that these wished for numbers will undoubtedly be marshalled through policy measures, McKinsey has projected that the population of India’s cities will increase from 340 million in 2008 to 590 million by 2030 – 40% of India’s total population.

This is the substance of my contribution to the latest instalment of the excellent journal, Agenda, published by the Centre for Communication and Development Studies through its Infochange development news website. See the full article here.

Infochange_Agenda_urbanisation“In short,” stated the report by this reckless consulting firm, “we will witness over the next 20 years an urban transformation the scale and speed of which has not happened anywhere in the world except in China. Urbanisation will spread out across India, impacting almost every state. For the first time in India’s history, the nation will have five large states (Tamil Nadu, Gujarat, Maharashtra, Karnataka, and Punjab) that will have more of their population living in cities than in villages.” This is indeed the trend for these states as it is also for Andhra Pradesh, West Bengal and Haryana.

The expectation is that as India’s cities expand, India’s economic profile will also change. In 1995, India’s GDP was divided almost evenly between its urban and rural economies. In 2008, urban GDP accounted for 58% of overall GDP. By 2030, according to the McKinsey report’s calculations, urban India will generate nearly 70% of India’s GDP. Such a transformation, if it comes to pass on the lines that global financial and consumer actors want, as India’s major ministries (commerce, industry, finance, food processing, agriculture) and its planning agencies want, is expected to deliver a steep increase in India’s per capita income between now and 2030 wherein the number of middle class households (earning between Rs 2 lakh and Rs 10 lakh a year) will increase from 32 million to 147 million.

Blocks of new apartments being completed on the outskirts of Chennai, Tamil Nadu. The blocks are crammed together by the builders to exploit all the available floor space without consideration for hygiene, ventilation and green space. These flat owners will install hundreds of air-conditioners in these flats to lower the indoor temperature, and this hideous group of eight and more ugly buildings will when occupied alter the micro-climate of what only recently were valuable wetlands.

Blocks of new apartments being completed on the outskirts of Chennai, Tamil Nadu. The blocks are crammed together by the builders to exploit all the available floor space without consideration for hygiene, ventilation and green space. These flat owners will install hundreds of air-conditioners in these flats to lower the indoor temperature, and this hideous group of eight and more ugly buildings will when occupied alter the micro-climate of what only recently were valuable wetlands.

This transformation is at the heart of the infrastructure and services obsession which is reshaping the next version of the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The McKinsey estimate is that to meet urban demand, India needs to build 350-400 km of metros and subways every year, and that between 19,000-25,000 km of road lanes would need to be built every year (including lanes for bus-based rapid transit systems), an ambition that denies altogether the impacts on land resources, on the destructive dominance of the automobile industry and proves the lie of India aspiring to a low carbon way of life.

From a reading of the early results of the 66th round of the NSSO, ‘Key Indicators of Household Consumer Expenditure in India, 2009-10’, for the urban population, in all income deciles including those that comprise the urban poor, the situation is already grim. Bhiwani in Haryana (population: 197,662), Bhind in Madhya Pradesh (197,332), Amroha in Uttar Pradesh (197,135) and Hardoi also in Uttar Pradesh (197,046) are four urban centres whose populations are at the median of those towns in India whose inhabitants number over 100,000. The average number of children in each (in the 0-6-year age-group) is 23,890.

Based on the recommended daily dietary allowance calculated for an Indian vegetarian diet by the National Institute of Nutrition, India, the minimum annual demand of each of these four urban centres is: cereals and millets, 43,124 tonnes; pulses, 9,122 tonnes; milk and milk products (kilolitres), 33,172; roots and tubers, 22,115 tonnes; green leafy vegetables, 11,057 tonnes; other vegetables, 22,115 tonnes; and fruits, 11,057 tonnes. Whether through the lens of municipal services provisioning or as a consumer project, urban administrations rarely plan for the food required by their citizens – its sources, costs and alternatives that can help establish a nutrient cycle between urban consumption and rural producers.

Re-indexing what 252 mt of foodgrain estimate means for India

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Cereals, pulses, oilseeds and the cotton-jute-cane group – these charts show how production of these major crop groups has varied relative to their maxima for the 1997-98 to 2011-12 period.

Rice 103 million tons. Wheat 90 million tons. That is the cereal base of the ‘third advance estimates’ of foodgrain production in India for 2011-12. The data has just been released by the Indian Ministry of Agriculture’s Department of Agriculture & Cooperation (it is the Directorate of Economics & Statistics which compiles and releases the numbers).

Going by the third advance estimate numbers for major crops, the rice estimate is just over the 102 mt target and the wheat estimate is 6 mt tons above. At just under 42 mt, the estimate for coarse cereals (jowar, bajra, maize, ragi, barley and small millets) is at the target level. Total cereals is 235.54 mt, about 7 mt over the target for the year. Total pulses (tur, gram, urad, moong, other kharif and other rabi) are estimated at 17 mt which is also on target. That gives India’s foodgrain an estimate of 252.56 mt for 2011-12 – it was 241.5 for 2010-11 and was 218.2 mt for 2009-10 (against a target of 239 mt).

[Here’s the data! You can get the data from these links, in the series that goes back to 1997-98 in the following formats: xlsx, xls and ods]

For commercial crops, the third advance estimates for the group of nine oilseeds (groundnut, castorseed, sesamum, nigerseed, rapeseed and mustard, linseed, safflower and soyabean) is 30 mt which is shy of the 33.6 mt target for 2011-12. In comparison, the 2010-11 target was 31.1 mt for the group of nine (target 33.2 mt). Converted to mt from bales, the advance estimate for cotton is 5.98 mt (target 5.78 mt), for jute and mesta just over 2 mt (target 2.,2 mt) and sugarcane 351 mt (target 350 mt).

This set of charts does not show how production has grown (or not) for the crops covered by the advance estimates series. Rather, it bases each crop on the maximum production recorded for the period 1997-98 to 2011-12 (the third advance estimates for this year) and shows how production of a crop in all the other years in the series matches the series maximum. This method gives us a very different view from the usual government-ministry line which tends to show (if not to provide data for) a steady upward trend.

Written by makanaka

May 5, 2012 at 15:36