What do Bolivia, Cameroon, Egypt, Indonesia, Senegal and Uzbekistan have in common? The answer is that all these countries have recently witnessed riots and violent demonstrations as people have gone on the rampage to protest against the scarcity of food and the inevitable consequence of scarcity — rising food prices. Indeed, the list given above is just a small sample of the many countries, including India, that are currently experiencing rapidly rising food prices.

The recent crisis in financial markets around the world has figured prominently in the media. Despite the severity of the global financial crisis and its potential adverse impact on world growth rates, the current food crisis threatens to have a significantly more serious impact on people’s lives, particularly in developing countries. The crisis has been developing for some time now, and should have been anticipated. Unfortunately, the media and, perhaps more important, governments across the world seem to have realized the magnitude of this crisis relatively recently.

World food prices have increased on average by almost 40 per cent during the course of the last year, while the prices of staple food items have increased by 80 per cent over three years. The United Nation’s World Food Programme seems to have woken up to the severity of the crisis, and has launched an appeal to increase its aid budget from $2.9 billion to $3.4 billion in order to meet its target of feeding 73 million people across the world at the higher prices prevailing today. The World Bank president has also appealed to the rich countries to provide funds to feed the poorer countries.

There is very little that individual countries can do in the short run to get out of the crisis. The Indian government’s reaction is quite typical of what other developing country governments have been doing. The Indian government has banned export of all food staples and has also slashed import duties on food items. Of course, the decision to ban food exports will only exacerbate the misery of countries that depend on imports to feed their citizens. The reduction in import duties will not help at least Indian consumers because the prices of world food items are quite a good deal higher than the prices prevailing in India.

So we have no option other than to tighten our belts and ride out the crisis. As a matter of fact, there may be a slight improvement in the situation in the immediate future. The UN Food and Agriculture Organization has predicted an increase in global rice production of 12 million tonnes or just below 2 per cent during this year. It expects much of the increased production to come from the major Asian rice-producing countries, including India. In addition, an important reason for the current food crisis has been the drought in Australia, which is the major wheat exporting country in the world. The rain gods may take pity on us and bring about some improvement in the weather conditions in Australia.

What has caused the current crisis? Is it all because of bad luck, such as the drought in Australia? Was it inevitable — a combination of rising populations and relatively stagnant food supplies? Or has it been caused by the pursuit of bad policies? All these factors have played a role in precipitating the crisis.

Bad luck has certainly played a part. Apart from the drought in Australia, several other countries, particularly in the developing world, have inadequate irrigation facilities and so their agricultural production is partly dependent on rainfall. So, there is always some variation in food outputs. The bad-output years have pulled down inventories and have left world food stocks very vulnerable.

The problem runs deeper. Simply put, the rate of increase in world food production over the years has simply not increased fast enough to keep pace with increases in world demand. Increases in demand have come partly through increases in world population. Moreover, increases in per capita incomes in the poorer countries have also contributed to higher per capita demands for food. The economist, Paul Krugman, who is perhaps better known amongst the lay public for his recent newspaper columns, also points out that increased incomes in China and in other developing countries have resulted in a substantial increase in the demand for meat. Since it takes 700 calories of animal feed to produce a 100-calorie piece of beef, the increased preference for meat has also increased the demand for grain.

But the more serious problem has been the failure to increase world food production. The Indian experience is quite representative of that in other developing countries. A sea-change in the agricultural sector was brought about by the so-called Green Revolution of the Seventies. The efforts of agricultural scientists were successful in producing high-yielding varieties of seeds. The government complemented the efforts of scientists by stepping up investment in irrigation facilities. A more extensive system of irrigation, multiple cropping and the high-yielding varieties of seeds combined to bring about substantially higher food outputs.

The ‘revolution’ in agriculture lasted throughout the period 1965-80. Although food grain outputs continued to increase throughout the Eighties, the process has clearly lost steam. For more than a decade, the rate of increase in food output has not kept pace with the increase in population, and so there has been an actual fall in the per capita availability of food grains.

How can we improve per capita food availability? While some increase in food output may come through the spread of irrigation facilities, the easy options of accelerating food grain production are more or less exhausted. The Green Revolution was promoted by the production of better seeds, and this is essentially what is required all over again. Unfortunately, there have not been any dramatic technological breakthroughs in improved varieties of seeds in recent years. Government policies in the Western world have also aggravated the food crisis. The ever-rising crude oil prices and the insatiable demand for energy in the West have prompted these governments to offer rather large subsidies in the production of alternative sources of energy as this was supposed to contribute towards energy independence. This has resulted in large-scale diversion of crops away from domestic households. For instance, European countries have been blending vegetable oils with diesel. Across the Atlantic, very large quantities of maize and wheat are being used in the United States of America to make bio ethanol.

It is particularly tragic that the conversion of corn into ethanol does not even contribute towards American energy independence. Even optimistic estimates tend to show that the production of a gallon of ethanol from corn requires almost a gallon of energy. So there is hardly any net increase in the supply of energy, but a significant decrease in the supply of food.