Hindu Editorial Analysis : 17-June-2023
India’s G20 presidency has made a commitment to depoliticise the global supply of food, fertilisers, and medical products, with the aim of preventing geopolitical tensions from escalating into humanitarian crises. The challenge of hunger and food insecurity persists, despite the fact that we produce enough food to feed 10 billion people. Currently, more than 800 million people go to bed hungry, and paradoxically, many of them are small-scale farmers who contribute significantly to global food production. This essay will explore the underinvestment in rural agriculture, the significance of investing in this sector, and the role of the G20 in addressing these issues.
The Issue of Underinvestment in Rural Agriculture
Three-fourths of the world’s poorest and food-insecure individuals reside in rural areas. Unfortunately, rural economies, especially agriculture, have suffered from chronic under-investment. Low- and middle-income countries are grappling with increasing debt burdens, while global inflation and local currency depreciation make it challenging for them to finance their development and climate action. Moreover, donor support for agriculture has stagnated at 4-6 percent of total official development assistance (ODA) for the past two decades.
The Need for Investment
To transform food systems, estimates suggest that an annual investment of US$300-400 billion is required until 2030. This means that investment needs to grow at least 30 times its current level. Investing in rural agriculture carries immense significance and can yield numerous benefits for governments, the private sector, and aid for the future.
Benefits for Governments
Boosting local production, food chains, and markets not only ensures global food security and job creation but also contributes to reducing conflict. Furthermore, investing in rural agriculture can lead to lower greenhouse gas emissions, as agriculture is responsible for up to 21 percent of total emissions.
Benefits for the Private Sector
Investing in small-scale farmers is a win-win situation. Production costs are low, returns on capital are high, and farmer organizations and cooperatives have demonstrated their ability to achieve economies of scale. Crop diversification can also help mitigate risks for farms and markets.
Aid for the Future
Investments in rural agriculture can build long-term resilience and reduce the impact of climate change and other shocks. It has been estimated that every US$1 spent on resilience saves up to US$10 in emergency aid in the future. Additionally, investment in agriculture is at least 2-3 times more effective in reducing poverty compared to investment in other sectors.
Investments by Multilateral Development Banks and Financial Institutions
Small-scale agricultural producers still lack access to credit, markets, technology, infrastructure, information, and land. This is where multilateral development banks and international financial institutions like the International Fund for Agricultural Development (IFAD) can make a significant difference. By de-risking investments through innovative financial instruments and mechanisms, agriculture can become the center of growth it has the potential to be.
About the G20
The G20 was formed in 1999 following the Asian financial crisis of the 1990s. Its objective is to secure global financial stability by involving middle-income countries. The G20 aims to promote financial regulations that prevent future crises and create a new international financial architecture for global economic stability and sustainable growth. Its members include Argentina, Australia, Brazil, Canada, China, France, Germany, Japan, India, Indonesia, Italy, Mexico, Russia, South Africa, Saudi Arabia, South Korea, Turkey, the United Kingdom, the United States, and the European Union.
India’s Presidency: Strengthening Global Support for Developing Countries
The G20 presidency is a rotational responsibility, and India has been entrusted with this role from December 1, 2022, to November 30, 2023. During its tenure, India is dedicated to bolstering international support for the vital priorities of developing countries across various social and economic sectors. These priorities encompass Energy, agriculture, trade, digital economy, health, environment, Employment, tourism, anti-corruption, and women empowerment.
Resource Mobilization for Global Food Security:
One of India’s primary objectives during its G20 Presidency is to ensure that every person has access to affordable, safe, sufficient, and nutritious food. To achieve this, India aims to mobilize resources effectively through a multi-pronged approach, which includes:
- Increasing Digitization: By promoting digital solutions in the agricultural sector, India seeks to enhance efficiency, access to information, and market opportunities for farmers.
- Making Insurance Attractive for Farmers and Insurers: India will work towards creating a conducive environment for farmers and insurers, encouraging them to adopt agricultural insurance schemes, thereby safeguarding against unforeseen risks.
- Providing Access to Easy and Discounted Loans: Through facilitating access to credit and affordable loans, India aims to empower farmers and rural communities to invest in their agricultural activities and infrastructure.
- Securing Land Rights: India recognizes the significance of secure land rights for farmers and will advocate for policies that protect and promote land ownership and tenure security.
- Strengthening Farmers’ Organizations: India will promote the establishment and empowerment of farmers’ organizations to enhance their collective bargaining power, knowledge sharing, and capacity building.
India’s Experiences & Leadership:
India has emerged as a vital partner in the global mission to eradicate rural poverty and hunger. Utilizing its successful panchayat system, India has built robust community institutions that empower people to take charge of their own development. These experiences serve as a beacon of hope and inspiration for countries striving to achieve food security. Additionally, India has demonstrated thoughtful leadership by advancing South-South and triangular cooperation, further solidifying its position in the global arena.
G20’s Path to Sustainable Rural Development:
As the G20 President, India envisions setting a course towards much-needed structural changes that will foster sustainable rural development and agriculture. To realize this vision, India seeks commitments from governments, global financial institutions, investors, and companies to invest in medium-term sustainable development projects. By collaborating on these initiatives, the G20 can pave the way for inclusive growth, improved livelihoods, and the eradication of poverty and hunger.
Through India’s presidency, the G20 has a unique opportunity to make a substantial and lasting impact on the world’s most pressing challenges, and with concerted efforts from all members, these shared goals can be achieved for the betterment of humanity.
Why In News
India’s G20 presidency has taken a decisive step by pledging to depoliticize the “global supply of essential goods such as food, fertilizers, and medical products,” aiming to prevent humanitarian crises fueled by geopolitical tensions. This commitment emphasizes the urgent need for international cooperation and ensures that access to vital resources remains uninterrupted, safeguarding vulnerable populations around the world.
MCQs about Promoting Food Security through Rural Agricultural Investment
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What is the main objective of India’s G20 presidency in relation to food, fertilisers, and medical products?
A. To increase geopolitical tensions
B. To depoliticise the global supply
C. To exacerbate humanitarian crises
D. To prioritize economic growth
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Why is investing in rural agriculture significant?
A. It boosts global food security and job creation
B. It increases greenhouse gas emissions
C. It causes conflicts and instability
D. It hampers economic growth
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How effective is investment in agriculture in reducing poverty compared to investment in other sectors?
A. Equally effective
B. Less effective
C. 2-3 times more effective
D. 4-5 times more effective
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What is the significance of investing in small-scale farmers in rural agriculture?
A. It increases production costs and lowers returns on capital.
B. It hinders farmer organizations and cooperatives.
C. It allows for economies of scale and crop diversification.
D. It poses risks for farms and markets.
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