Download But India`s production of pulses has stagnated at around 18

CASE STUDY ON THE GROWING RATES OF PULSES AND ITS
AFTERMATH EFFECTS IN THE INDIAN ECONOMY
Varun Kesavan, Research Scholar, Coimbatore
Email Id – [email protected]
A pulse (from Latin: puls,[1] from Ancient
Greek πόλτος: poltos "porridge"),[2] sometimes
called
a
"grain legume",[3] is
an
annual leguminous crop yielding from one to twelve seeds of variable size, shape,
and color within a pod. Pulses are used as food for humans and other animals.
Included in the pulses are: dry beans like pinto beans, kidney beans and navy
beans; dry peas; lentils; and others.
Like many leguminous crops, pulses play a key role in crop rotation due to their
ability to fix nitrogen. To support the awareness on this matter, the United
Nationsdeclared 2016 the UN International Year of Pulses.[4]
The words "bean", "lentil", and "pulse" may refer to just the seed or to the entire
plant.
The term "pulse", as used by the United Nations' Food and Agricultural
Organization (FAO), is reserved for crops harvested solely for the dry seed. This
excludes green beans and green peas, which are considered vegetable crops. Also
excluded
are
crops
that
are
mainly
grown
for
oil
extraction
(oilseeds like soybeans andpeanuts), and crops which are used exclusively for
sowing (clovers, alfalfa). However, in common use, these distinctions are not clearly
made, and many of the varieties so classified and given below are also used as
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vegetables, with their beans in pods while young; cooked in whole cuisines; and sold
for the purpose; for example, black-eyed beans, lima beans and Toor or pigeon peas
are thus eaten as fresh green beans, or cooked as part of a meal.
World economy
India is
the
world's
largest
producer
and
the
largest
consumer
of
pulses. Pakistan, Canada, Burma, Australia and the United States, in that order, are
significant exporters and are India's most significant suppliers. Canada now accounts
for approximately 35% of global pulse trade each year. The global pulse market is
estimated at 60 million tonnes.
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Production of Gram (chickpeas) is the highest among all pulses produced in the country.
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THE IMPACT ON INDIA’S ECONOMY DUE TO PRICE HIKE OF PULSES
India consumes around 23 million metric tons (MMT) of pulses. This is an aggregate
of a variety of pulses including gram (chana), tur or arhar, mung, masur and urad.
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Pulses are the main source of protein for a very large number of people in the
country - each 100 grams contains about 32 grams of proteins and several amino
acids not made by the body. So, it is an essential part of Indian meals. Naturally,
India is the largest producer and consumer of pulses in the world.
But India's production of pulses has stagnated at around 18-19 MMT for several
years now. The shortfall between production and consumption is made up by
imports,
mainly
from
Canada,
Myanmar
and
some
African
countries.
This balance has been maintained at a huge cost to the people. A population
growing at the rate of about 2% per year in the past decade should have quickly
overtaken the pulses rate of growth which was less than half of that. This has not
happened because the amount of pulses consumed per person has relentlessly
declined over the past several decades. From about 61 grams per person per day in
1951 to about 42 grams in 2013.This year the balance has been rudely and
dramatically upset. In 2014-15, production of pulses was clocked in at 17.4 MMT - a
decline of 2.4 MMT or 12% over the previous year, and also there has been a
decline in the rate of pulses for domestic consumption in the country from 23.1 MMT
to 21.7 so its almost 6.6% decline under the pulses category. This was caused by
various factors including unseasonal rains, pests, and unprofitable prices for offered
to farmers even as import duties were waived.
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THE OTHER EXTRANEOUS FACTORS LEADING TO PRICE HIKE OF
PULSES ARE AS FOLLOWS
1. Increase
in
the
demand
for
protein-enriched
food
and
green
vegetables: The lesser-known Bennet’s law gives an important explanation for
rising food prices. According to this law, when income rises or people become
wealthier, they change their dietary habits, shifting their tastes from simple
starchy plant-dominated diets to variety of food items, including a range of
vegetables, fruit, protein rich food and dairy products. However, the supply of
these vegetables and pulses is not adequate in comparison to their demand.
Hence, the price rises.
2. Global inflation: Experts say that rise in essential food items in India is primarily
because of the increasing commodity prices abroad, increase in fuel prices and
fertilizers, which in turn affect the local produce by increasing input costs.
3. Less space for cultivation: With an increase in population, there is also an
increase in the demand for vegetables and pulses. Increase in population has
also led to increased urbanisation. Manufacturing, energy and service industries
are all competing for land, water and human resources. With less availability of
land, the prices for agricultural land are rising, leading to increased costs of
agriculture produce.
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4. Improper management and distribution: An important question that arises is
whether the agricultural produce has been stored and distributed optimally or
not? There is always a gap in the food sector regarding this. Whenever, a report
on climate change is published or a prediction of a flood or drought, there are
instances of occurrence of supply shocks. Because of the short sightedness, the
prices go up significantly. Deliberate spoilage of food due to inadequate storage
and distribution reduces supply, thereby increasing the price.
5. Less production of pulses: Despite high wholesale pulse prices in recent
years, farmers of India are not very keen on taking up cultivation of pulses due to
high fluctuations in production and prices. There is no effective government price
support mechanism. Farmers are keen on cash crops cultivation like cotton and
maize because of better returns and lower risk. This was published in a research
study by the National Council of Applied Economic Research. In the same study,
it was also mentioned that production of pulses has recorded less than 1% yearly
growth during the last 40 years, which is less than half of the growth rate in Indian
population. As a result, per capita production and availability of pulses has
witnessed sharp decline in India. This invariably leads to a rise in the price of
pulses.
6. Hoarding: The concept of keeping stock of food products like onions, potatoes,
rice, pulses etc. even when the season is over and reselling at higher prices
when there is demand is known as hoarding. In India, hoarding of essential
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commodities is very common and goods are sold at double the prices for
increased profits.
7. Increased
cost
of
transportation: With
increase
in
fuel
prices,
the
transportation charges also increase, leading to a rise in prices of all
commodities, and vegetables and pulses are no exception.
8. Increased cost of production: One major cause of increase in the prices of
vegetables and pulses is the rise in the prices of the raw materials required in the
production starting from seeds, to fertilisers, pesticides, and labour costs. As a
result, the cost of the end product also increases.
9. Many mediators: In India’s trading community; the end product reaches the
consumer after passing through various mediators or middlemen. Each mediator
tries to get profits by increasing the original cost and the end price becomes very
high than the actual price. So, it is very common in India that we, as consumers, pay
a high price and at the same time the farmers do not get a deserving price for the
same food product.
10. Supply chain mismanagement: There has been mismanagement in the supply
chain of vegetables and pulses from the farmers to the consumers. According to
reports, the difference in wholesale and retail prices is anywhere between 40% and
60% and this margin is more within cities where there are the wholesale markets.
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Some of the major issues related to supply chain mismanagement in India are lack
of rural infrastructure, inadequate and ill-equipped mandis, lack of proper handling
and no direct marketing by “farmers to consumers.”
Questions
1. What measures can be adopted in reducing the prices of pulses?
References
1. http://www.mapsofindia.com/my-india/government/top-10-reasonswhy-vegetable-and-pulses-prices-keep-soaring-in-india
2. http://timesofindia.indiatimes.com/india/Why-dal-prices-havedoubled-Heres-the-math/articleshow/49426042.cms
3. http://agricoop.nic.in/imagedefault/trade/Pulses.pdf
4. https://en.wikipedia.org/wiki/Pulse_(legume)
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