G-20: Priorities for India in agriculture

The G-20 must keep in focus countries having large shares of the population dependent on agriculture for their livelihoods. India has made significant strides in securing food security and its experience can, therefore, provide useful guideposts for collective action by the G-20.

G-20: Priorities for India in agriculture

As India assumed the Presidency of G-20 at one of the more uncertain periods in human history, Prime Minister Narendra Modi unveiled his government’s priorities while leading the group of the largest and the most powerful countries. India’s agenda, he said, would be one of strengthening cooperation and coordination between the G-20 countries by depoliticizing the “global supply of food, fertilizers and medical products, so that geopolitical tensions do not lead to humanitarian crises.”

He argued that the “greatest challenges” that humanity faces, including those arising from climate change, among others, “can be solved not by fighting each other, but only by acting together.” This imperative of “acting together” cannot be emphasized more in the engagements of the G-20 countries for addressing the chronic problems of hunger and food insecurity in developing countries, which requires more resilient and sustainable agriculture and food supply systems.

For the latter objective to be realized, the G-20 must keep in focus countries having large shares of the population dependent on agriculture for their livelihoods. India has made significant strides in securing food security and its experience can, therefore, provide useful guideposts for collective action by the G-20.

In 2015, when the Sustainable Development Goals (SDGs) were adopted, there was a sense of optimism among signatory countries that by 2030, the global community would be able to “end hunger, achieve food security and (provide) improved nutrition.” It was agreed that these objectives could be achieved by ensuring “sustainable food production systems” and by implementing “resilient agricultural practices that increase productivity and production.”

These targets encapsulated the essence of Goal 2, “Zero Hunger”. But seven years into the implementation of Goal 2, there are signs of retrogression in achieving the targets.

The UN’s Sustainable Goals Report of 2022 has warned that the “world is on the verge of a global food crisis, with a rising number of people experiencing hunger and food insecurity”, and that this scenario has been prevailing from even before the pandemic. With the onset of the pandemic, millions faced acute food insecurity as the pandemic caused unprecedented levels of disruption of lives and livelihoods. According to the UN, as many as 828mn people may have suffered from hunger in 2021.

Russia’s invasion of Ukraine dealt another severe blow. The war directly jeopardized nearly a third of global exports of wheat that originated from the two countries in conflict. Further, fertilizer exports from Russia were hampered due to the sanctions imposed by the Western alliance on Russia that resulted in supply shortages in several major agriculture-producing countries, including India.

This caused, according to the UN Global Crisis Response Group on Food, Energy and Finance, the “largest cost-of-living crisis of the twenty-first century” as the FAO Food Price Index went up by nearly 18 per cent between January and March 2022. Although food prices have softened during the second half of 2022, cereals, dairy and meat prices continue to be higher than what they were at the beginning of the year.

Given the persistent nature of global uncertainties and the heightened threat to food systems that the world has seen in the recent past, it clearly needs collective efforts from the G-20, the countries that are most equipped to do so, especially due to the varied and rich experiences that they can bring to the fore. India is in a unique position to contribute to these efforts for it has the experience of turning around from being a chronic food-insecure country in the past.

One major advantage that the G-20 countries have in this area is that the grouping has in place a robust Food Security and Nutrition (FSN) Framework based on a food systems approach, which was developed in 2014.

The Framework identified three “Priority Objectives”, which are as follows: (i) increase responsible investment in food systems; (ii) increase incomes and quality employment in food systems; and (iii) increase productivity sustainably to expand the food supply.

A number of possible actions were identified under these “Priority Objectives”, including the need to promote infrastructure investment by public-private partnerships for food value chains, increasing development finance and overcoming agricultural market failure in developing countries, sharing experience in labour market planning and programmes in the context of rural and agricultural modernization and promoting international collaboration in research, development and innovation and adapting them to the needs of developing countries.

Besides these structural and institutional reforms, the FSN Framework spoke of “an open, transparent and efficient food and agriculture trade that allows developing countries to consider their policy space, subject to WTO (World Trade Organization) rules and obligations, can boost sustainable agricultural growth and increase the diversity and resilience of a country’s food supply, while reducing the cost of food and excessive food price volatility.”

Among the issues prioritized in the FSN Framework, reforming the global agricultural trade regime can be considered as the low-hanging fruit in making progress towards the effective operationalization of the Framework.

This is due to the fact that the G-20 members have largely been the drivers of WTO processes in all key areas, including in agriculture, and, therefore, an agreement amongst these countries is essential to realize the outcomes that the FSN Framework desires.

India has been an influential participant in the WTO discussions on agriculture, and can, therefore, play its rightful part in ensuring that the increasing concerns regarding food security and nutrition, not to speak of the implementation of SDG Goal 2, are addressed fully.

The advantage of the Indian Presidency is that it can build upon some important decisions that have been taken over the past two Presidencies. In 2021, under the Italian Presidency, the G20 Foreign Affairs and Development Ministers endorsed the Matera Declaration on Food Security, Nutrition and Food Systems. The Declaration highlighted the importance of an open, transparent, predictable and non-discriminatory multilateral trading system, consistent with WTO rules, to enhance market predictability and allow agri-food trade to flow so as to contribute to food security and nutrition. It added that international trade is crucial to ensure access to inputs, goods and services to produce safe, nutritious and affordable food.

Almost in the same vein, in Bali, Leaders of the G-20 reiterated their support for open, transparent, inclusive, predictable, and non-discriminatory, rules-based agricultural trade based on WTO rules. They expressed their commitment to sustained supply, in part based on local food sources, as well as diversified production of food and fertilizers to support the most vulnerable from disruptions in the food trade supply chain. Most importantly, the Leaders of the G-20 emphasized that they would “avoid adversely impacting food security deliberately”.

The WTO has indeed a key role to play in ensuring transparency and predictability in agricultural trade and production as several of the critical policy instruments relevant to this sector that governments have been using are monitored by the Agreement on Agriculture (AoA). It must, however, be pointed out that the rules laid down by the AoA are not all about maintaining an open and non-discriminatory trading system; the Agreement also emphasizes that non-trade concerns, including food security, rural livelihoods and rural development, must be given due recognition.

While the preamble to the AoA speaks of the importance of food security as a non-trade concern, the Ministerial Declaration adopted at the conclusion of the third WTO Ministerial Conference spoke of rural livelihoods and rural development as non-trade concerns that should be realized during the implementation of the AoA. India has been a strong votary of effective implementation of these non-trade concerns, which it has been raising on behalf of the developing countries that have a sizeable workforce dependent on agriculture.

As mentioned above, in the Bali Summit, the leaders of the G-20 had expressed strong support for the grouping for “open, transparent, inclusive, predictable, and non-discriminatory, rules-based agricultural trade based on WTO rules.” This articulation in the G-20 Leader’s Declaration is significant as the host country, Indonesia, has been a strong votary of making the existing AoA rules meet all the parameters that have been identified. What is important to point out is that India and Indonesia, along with a sizeable number of developing countries, have been trying to force changes in several provisions of the AoA; in particular, those related to the subsidies granted by some of the advanced countries to ensure better equity in the markets for agricultural products.

In this context, it is essential to recognize that re-purposing the farm subsidies is vitally important for the development of resilient and sustainable agricultural systems. Thus, subsidies that can help in realizing the target set by the G-20 Leaders in Bali, of “sustained supply, in part based on local food sources, as well as diversified production of food” that can protect the “vulnerable from the disruptions in food trade supply chain” should be encouraged.

These forms of subsidies should replace those that are currently being granted to produce large surpluses of food crops, which are then disposed of in the international markets. Such forms of surpluses have not only historically damaged the local food systems in poorer countries but have also disrupted livelihoods dependent on agriculture in these countries. The expectation from the Indian Presidency of G-20 would be that it is able to provide the leadership for securing a lasting solution in this area.

(Dr Biswajit Dhar is a Professor at the Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University. The views expressed here are his own.)