Being helped by agricul
tural innovation and gener
ous farm subsidies, India is growing an immense quantity of food, resulting in bigger grain stockpiles than any country, except China. India exports grains to countries like Saudi Arabia and Australia. Still one fifth of India’s population is malnourished, which is double the rate of other developing countries like Vietnam and China. Fed by pervasive corruption, mismanagement and waste in the public distribution programmes that are supposed to distribute food to the poor, India’s food policies have failed. In Northern India, while the poor are struggling on meagre portions of flatbread and potatoes, rice crops have been stacked along highways for several years, and is now being sent to distilleries to be turned into liquor. Flies swarm over spoiled wheat. India’s food policy aims to provide farmers with higher and more consistent prices for their crops than they would have got from the open market. The objective is also to sell food grains to the poor at lower prices, than they would have paid at private stores. The sprawling system is almost 1% of India’s gross domestic product, and costs the government Rupees 750 billion. Despite an increase of almost 50% in food production, 21% of India’s 1.2 billion people remain hungry.
Overall price inflation is up 7.5%. Some 83 million tons of excess food grains stock is partly responsible for a vicious cycle of high prices. The government procures wheat and rice locally at high floor prices to support millions of poor farmers. This pushes up the market price of the grains, and increases inflation. The support price of wheat has risen by 80% in the past five years. While the farmers are making a profit, the union government of India, is unwilling to sell the stock off shore at a loss. A shortage of warehouses and silos has led to around twenty million tons of grains lying in the open over the past three years, exposed to vermin and the monsoon rains. The government has purchased more than 40% of the 2011 harvest. This has created a supply shortage in the open market and encouraged hoarders to speculate on higher prices. Public finances were stretched, as the government paid 20% more than the international price of wheat. The highest bid received for wheat exports has been 23% below the price India has paid. Most of the surplus grains are exposed to the elements, turning into animal-feed quality, and would command a cheaper price. Just 41.4% of the grains picked up by the states from central warehouses reaches Indian homes.
Disenchantment in South Africa
The African National Congress, South Africa’s governing party, is 100 years old. The five yearly ANC policy conference of June 2012, debated the factional battles over power and resources. The next meeting is in December 2012. Amid warnings of rampant joblessness, President Jacob Zuma could face a leadership challenge, which may lay out the direction the ANC and Africa’s largest economy will take. While social and economic ills hover over South Africa, patronage, corruption and factionalism are hampering its fight against unemployment, poverty and inequality. Tokyo Sexwale, minister for human settlements (housing) and Kgalema Motlanthe, deputy president are challenges to the leadership. Gwede Mantashe, ANC secretary general advocates ‘‘generational change’’, and a more open and transparent party election process. Respected ANC veterans feel that factionalism has shifted from being based on ideology to power access. There is anger among a lot of African High School and University graduates, who are not being absorved into the labour market. A strong support exists for Julius Malema, expelled ANC youth leader, who called for the nationalization of mines and expropriation of white-owned land.
North Africa Militants
Confronted by the Algerian governments anti-terrorism measures, Islamist militants in Algeria, are taking refuge in the Sahel to the south. There is growing unrest in the Sahel, as it has become home to a potent mix of extremist groups. Military actions by Algeria and other North African states have driven Al-Qaeda groups of the Islamic Maghreb from the highly urbanised Mediterranean coastal strip to the southern, sparsely populated Sahara. There are more militants arriving from several parts of Africa to the Sahel region, armed with weapons looted from Libya. Besides, influenced by extremist militants, nationalist autonomous movements are getting a lot of weapons. Al-Qaeda’s north Africa branch claims that it has launched over seventy shooting, bombings and ambushes, and killed at least sixty five members of the security forces, over the past eight months, mostly in the mountaneous Kabylia region. In January 2012, Tuareg fighters with mixed Nationalist and Islamist ideologies, who rebelled in northern Mali, had established a mini state in the area. New gas fields have been discovered along the Algeria-Mali border. Algeria is giving counter terrorism training to Mali and Niger.
Vol. 45, No. 7, Aug 26-Sep1, 2012