Rising Food Prices and Financial Crisis in India:Impact on Women and Children and Ways of Tackling the Problem

S. Mahendra Dev
The objective of this study is to examine the analytical issues that relate to the pathways leading to the impact of the rising food prices and the global financial crisis on households, particularly women and children. The study also outlines and discusses the desirable macro level, and sectoral and social protection policies and measures that would protect/improve the living standards of households in terms of nutrition, healthcare, education and child protection.

The poor and vulnerable were significantly lagging behind in terms of human development, and social and financial security even before the onset of the food and global economic crises, which have further undermined their food security and livelihoods. The coping strategies adopted by the affected people could also have an adverse impact on the food security and human development of women and children. India did well to insulate itself from the rise in global food prices during 2005-08. However, the volatility in food prices and the financial crisis can continue to pose a threat to the food and nutrition security of the country.

The pathways that lead to poor outcomes in terms of the nutrition, health and education of children due to an increase in food prices can be grouped into the following four heads: (1) impact on poverty; (2) macro-economic impact and its effect on employment and the social sector; (3) impact on nutrition and social protection programmes; and (4) impact on women’s well being and intra-household decisions. The cumulative impact of all these outcomes is reflected in two ways: (a) rise in household poverty, and (b) effect on child-specific factors. The financial crisis is also likely to have a negative effect on agriculture and the food security of the country. It may be noted that social inequality is high across all the states in India. Poverty levels and vulnerability are especially high among the SCs/STs and Muslims as compared to the OBCs and other castes.

The study discusses the macro and sectoral level policies and social protection measures needed to protect children from the two crises and to improve their well-being. The Indian Government has taken several monetary and fiscal measures in order to reduce the impact of the financial crisis on the country. However, the stimulus package offered by the Government needs to be aimed at the agricultural sector and primary food producers. Another view is propagated by the NCEUS, which highlights the urgent need to protect the livelihood security, employment and income levels of the poor and vulnerable sections, which would also stimulate the overall economic growth.

Many social protection programmes are currently being implemented in India. Among these, the major schemes for the poor fall into the following four categories: (i) food transfer like the PDS and supplementary nutrition; (ii)self-employment; (iii) wage employment; and (iv) social security programmes for unorganized workers. Many women-specific programmes are also under implementation. Some of these social protection schemes, however, need to be scaled up and made more effective in order to reduce the negative effects of the food price rise and the financial crisis. Further, child-specific programmes are also needed. The social protection programmes discussed in this study, including those aimed at ensuring adequate nutrition, school feeding programmes, health and education for children can thus help the families cope with the twin crises.