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2030 Vision for the Global Food System: Implications for India
The document outlines the 2030 vision for the global food system, emphasizing the importance of increased supply chain efficiency, enhanced agricultural productivity, and improved nutritional outcomes to combat poverty in India. It highlights the projected increase in food demand, necessary job creation, and the urgent need for climate-smart agricultural practices. Furthermore, it discusses policy reforms aimed at achieving food security while addressing sustainability challenges and promoting rural transformation through agribusiness and technology integration.
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Overview of the 2030 vision for global food system and its implications for India.
Focus on shared prosperity, food security, and job creation in reducing poverty in India.
World food demand to increase by 20% by 2030, with significant shifts in India's food demand.
Average incomes of the poor must rise; link between agricultural productivity and rural poverty reduction.
Need for climate-smart agriculture to enhance productivity while addressing environmental challenges.
Increasing constraints from land and water use, highlighting groundwater and land management issues.
Urgency for improved nutrition outcomes in India through enhanced food systems and health interventions.
Necessity for modernized farming methods to meet food demands and ensure higher productivity.
Role of agribusiness in creating jobs and transforming rural economies through improved practices.
Need for a redefined policy approach for agriculture focusing on resource efficiency and subsidy realignment.
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2030 Vision for the Global Food System: Implications for India
- 1. 2030 Vision forthe Global Food System Implications for India Juergen Voegele Senior Director, Agriculture Global Practice, World Bank Plenary Presentation to 12th Agricultural Science Congress, Karnal, India. February 4, 2015 1
- 2. Essential for EndingPoverty & Shared Prosperity Shared Prosperity Increased supply chain efficiency helps lower consumer food prices thereby raising real incomes of the poor, who spend a large share of their income on food More and better jobs (farm, non-farm rural, agro-processing) Improved food security (food shocks increase poverty, civil unrest, and can impair human capital development) World India Number of rural poor (2010) (millions) ~900 ~285 Number of rural poor that could migrate to cities by 2030 (2010) (millions) ~200 ~40 Number of poor people remaining in rural areas to be lifted out of poverty from 2010 to 2030 (millions) ~700 ~240 Ending Poverty 2
- 3. 3 • Able tofeed every person, every day, in every country with a safe, nutritious and affordable diet (+35% more food - FAO) • Jobs and income gains in the food system to meet poverty reduction targets Improved health outcomes End of hunger & reduced child stunting (to 5%) Reduced food related NCDs No net increase in obesity Improved sustainability Reduced GHG emissions Improved land & water mgt Protected local communities & biodiversity 2030 Vision for the Global Food System SDG Goal 2: End Hunger, achieve food security, and improved nutrition, and promote sustainable agriculture
- 4. World food demandis projected to increase by 20% by 2030 with a shift in consumption towards non-cereal products Dev = Developed countries, Devg = Developing countries, SSA = Sub-Saharan Africa, NE/NA = Near East and North Africa, LAC = Latin America and the Caribbean, SA = South Asia, EAP = East Asia and the Pacific Source: Derived from Alexandratos and Bruinesma (2012). Percentage change in projected demand for food products between 2015 and 2030 (%) Food, jobs, incomes World Dev Devg SSA MENA LAC SA EAP Cereals, food 16 3 18 56 22 14 19 7 Cereals, all uses 18 12 20 - - - - - Roots and tubers 20 0 24 47 26 12 37 4 Sugar and sugar crops (raw sugar eq.) 21 1 27 62 25 12 32 22 Pulses, dry 21 5 20 60 15 10 11 4 Vegetable oils, oilseeds & products (oil eq.) 26 6 36 64 30 21 41 30 Meat (carcass weight) 25 8 35 63 45 26 76 30 Milk and dairy, excl. butter (fresh milk eq.) 23 7 34 50 31 22 37 35 Other foods (kcal) 20 7 24 48 26 19 31 17 Total foods (kcal) 20 4 23 55 25 16 25 14 4
- 5. Shift in compositionof food demand in India by 2030 Food, jobs, incomes -8 -5 6 10 11 18 37 52 56 78 81 100 110 Projected Increase in Food Demand in India by 2030 (% change relative to 2011) 5 Requires some form of post-harvest processing/management
- 6. Average incomes ofthe poor in developing countries will need to increase by 45% by 2030 − in India by 30% Average Incomes of the poor will need to increase at a faster rate to end poverty by 2030 Source: Derived from Olinto, P. Beegle, K., Sobrado, C., and Uematsu, H. (2013). The State of the Poor Food, jobs, incomes 6 0.84 0.96 0.67 0.82 0.95 0.74 0.84 0.87 0.65 0.75 0.85 0.95 1.05 1.15 1.25 1980 1990 2000 2010 2020 2030 AverageDailyIncomeofthePoor India China Developing World Povert Line PPP$1.25
- 7. Food prices stillrelatively high, some recent weakness with oil price declines 7 Source: World Bank data 0 20 40 60 80 100 120 140 160 0 20 40 60 80 100 120 140 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 World Oil Prices World Grain Prices Food, jobs, incomes
- 8. Redouble the focuson productivity in India as price improvements have been the main source of recent changes in the real value of agricultural output 8 -100 -50 0 50 100 150 1981-82 1982-83 1983-84 1984-85 1985-86 1986-87 1987-88 1988-89 1989-90 1990-91 1991-92 1992-93 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 Millions Area Yield Price Diversification Interaction Source: World Bank (2014) Republic of India: Accelerating Agricultural Productivity Growth Food, jobs, incomes Annualchangeinrealvalueofagriculturaloutput (Rsmillion)
- 9. Structural transformation underway,but agriculture remains a significant employer • Agriculture remains a significant employer – Globally: 30 percent of all workers employed in agriculture – India: 49 percent of adult work force engaged in agriculture • 64 percent of rural employment (59% of males but 75 % of females) • Rural non-farm employment also a major source of jobs – Rural non-farm employment rises with agricultural productivity (strong correlation across countries, and within India across states) – India: Rural non-farm employment accounts more than all urban employment (295 million, 28% of workers) • Potential for agribusiness/agro-processing potential – Agribusiness share of GDP increases with per capita incomes – India: 10% growth of organized food processing output, results in employment growth of 5% Food, jobs, incomes 9
- 10. Higher agricultural productivityis good for poverty reduction 0 5 10 15 20 25 30 35 40 45 50 0 10000 20000 30000 40000 50000 60000 70000 80000 90000 RuralPoverty(%) AgriculturalProductivity(Rs.PerHa) Ag Productivity (Rs. per Ha, TE 2007) Rural Poverty HCR (2011/12) 10 Food, jobs, incomes Source: World Bank estimates using ICRASAT district level database, and NSSO poverty estimates 2011-12
- 11. Agricultural productivity inIndia needs to be more climate-smart 11 Food, jobs, incomes -30-20-10 0 1020 1970 1980 1990 2000 2010 Year Aggregate Rainfall Anomaly (%) Trend-Deviation in Real Ag. Production Trend-Deviation in Cropped Area Trend-Deviation in Real Ag. Productivity Source: World Bank (2014) Republic of India: Accelerating Agricultural Productivity Growth
- 12. Climate change estimatedto reduce world crop yields by 5% for each 1OC increase in atmospheric temperature, with large regional variation Source: World Resources Institute Sustainability 12
- 13. +2OC world +4OC world Dryseason Wet season - Greater seasonal variance - Increased intensity and variability of monsoons - Higher frequency of extremes - Slower wheat growth at higher temperatures Climate change projected to increase weather variability in India Source: Turn Down the Heat: Climate extremes, Regional Impacts, and the Case for Resilience Sustainability 13
- 14. Agriculture emissions needto decline by 25% by 2030 and 50% by 2050 to proportionally contribute to limiting temperature rises to 2OC Sustainability 14 Source: World Resources Institute (2013): Creating a Sustainable Food Future.
- 15. Land and waterare becoming more constraining Water stress Source: World Resources Institute Land Constraints Sustainability 15 57 50 34 66 61 183 152 50 140 175 51 49 400 314 37 4 94 0 100 200 300 400 500 600 700 Sub-Saharan Africa Latin America Near East/North Africa South Asia East Asia Millions hectares Unused balance 2050 (prime & good) Change of "in use" to 2050 In use - prime & good In use - marginal (incl. irrigated desert) Source: Alexandratos and Bruinesma (2012).
- 16. Monsoon fluctuations posegreater risk with falling groundwater Pre-Monsoon groundwater levels 2012 relative to 2002-11 average Red = decline Blue = increase 16Source: Ground Water Year Book, India 2012-13. Central Ground Water Board, Ministry of Water Resources, GOI, May 2013.
- 17. Need Improved NutritionalOutcomes Health Outcomes Developing World India Children under 5 moderately or severely underweight (%) 16 44 Population undernourished (%) 12 15 Share of Men > 20 overweight and obese (%) - 20 Share of Women > 20 overweight and obese (%) - 21 17 Share of population undernourished (%) Developing World India 1990-1992 20 23 2006-2008 16 20 2012-2014 12 15 2030 (projection) 8 Source: Derived from Alexandratos and Bruinesma (2012). Source: UN MDG data, The Lancet
- 18. We need afood system that: • Provides food to meet higher and shifting composition of demand • Raises incomes of the poor (farm labor productivity and access to markets), and increases jobs in agri-businesses • Improves nutritional outcomes • These have to be achieved with the existing natural resource base, in a more climate-smart way … especially in India given its importance to the global food system 18
- 19. What this meansfor India 19 Increased resource use efficiency Getting more from what you have
- 20. Modernizing agriculture toprovide food for increasingly sophisticated consumers • Remove policies biases against production of higher value crops – Remove disincentive for farmers to respond to market signals – Could fulfil the PM’s desire to double farmer incomes with current technology • Closing yield gaps to maintain food staple security – Reducing rice yield gaps in other states (50-70%) by half would eliminate the need to produce any rice in the major water stressed states (Punjab, Haryana or Maharashtra) • Priorities – refocus research, use skills and private sector for more knowledge intensive and resilient agriculture – Research for Sustainable Development: Central to the CSA agenda • Refocus research agenda on lagging states; biotic & abiotic stresses • Adaptation to climate risks: water, drought, heat tolerance, shifting production cycles • Better breeds/feeds to reduce livestock GHG footprint – Smallholder focus: delivering services and integration higher value chains – Private sector engagement in technology (seed systems a key area) – Human resource base: Skilled, technologically savvy youth for sophisticated high-tech, precision agriculture – revival of once illustrious agricultural university system 20
- 21. To create jobsfor rural transformation - Agribusiness for transformative change • Falling farm size with population increase on finite land, need to increase productivity of smallholders – 0.6 ha per household; 75% marginal farm size – less than 1 ha – Likely to get smaller: rural population projected to grow till 2028 (UN projections) – Sustainable intensification of smallholder livestock production and horticulture • Huge potential for post-harvest food management – Explosive urban & rural non-farm demand: different, convenient, safer and nutritious foods – Create good non-farm jobs: entry into manufacturing for low income/agricultural states • Priorities – remove regulatory and structural barriers, food safety – Policy and regulatory regimes: • create a competitive & efficient single national market; improve business environment for private investment (e.g. remove movement restrictions, increasing competition in wholesales markets, streamline/reduce multiple taxes/fees) • Promote MSME’s and agri-business: business regulatory reforms, labor laws and regulations. Recent important steps by new government will go a long way – Address structural barriers: rural roads, power, specialized value chain infrastructure – Food safety and health standards for a modern food system 21
- 22. To improve nutritionaloutcomes • Not just about food, but food of course is central to better nutrition – Multi-sector approaches: health, agriculture, water and sanitation, education, economic growth (e.g. “Swacch Bharat Abhiyan”) – Productivity and diversification on-farm – providing a wider diversity of foods • Safer and more nutritious foods – Availability of diverse high-nutrition foods – Tackle the malnutrition of the urban/affluent society (obesity) • Important for Climate-smart agriculture, incomes and jobs agendas – High value agriculture creates more jobs, higher value/incomes, benefits women and small-holders disproportionately • Priorities – women’s empowerment, education & awareness, technology, and policy environment – Mainstream key principles in public actions: women’s empowerment, education and awareness – Private sector role in on-farm technology (seed sector development), PH technology (fortification) and logistics (public investment and business environment) – Agriculture policy framework conducive to dietary and production diversity 22
- 23. Policy framework formacro-transformation of agriculture • Government objectives – legitimate with past success – Food security, support for farmers, protect consumers: Legitimate objectives for a responsible government in a large country – Also a global responsibility: an agricultural powerhouse (world’s top 1-3 producer of major crops) – Laudable past success: national food security compared to the dire situation in 1960s • Now a costly approach: financially, and for sustainability and growth – Effects of price and input policies well known: diversification; economic inefficiency – Less appreciated: compromising productivity and resilience: water & soil problems; GHG • Are there options to achieve these objectives more efficiently? – 2010-11: agricultural subsidies estimated at $56 billion (food, fertilizer, power, irrigation, other) – 2015 budgeted subsidies: for food alone $26 billion and fertilizers another $16 billion • Massive opportunity for impact: realign expenditures for greater and more sustainable impact on core objectives – Broad principle: shift from supply side subsidies to demand side support (transfers) – less distortionary – Important debates in country: technology for efficient delivery, reduce leakages, transfers, shift from supply side to demand side subsidies (income vs price) – E.g. storage: Great initiative by government to explore alternatives: HLC report on options • Private storage – cheaper, market friendly, less distortionary 23
- 24. Options to realignsubsidies to improve resource use efficiency • Direct income transfer (in place of physical quantity) • Exception in remote non-banked areas Resource use (water, land) • Income transfers equivalent to fertilizer and power subsidy (in place of price distortions) • Subsidies for CSA practices e.g. – Water saving technologies/ more crop per drop – Land reclamation – Alternative wetting & drying rice – Substitute for rice production in water stressed areas – Landscape approaches: watershed management, water harvesting, soil health Pro- Climate-Smart Agriculture Indicative size: $26 billion FY15 Indicative size: $16 billion FY15 New technologies (cell phones, biometic cards, etc) have lowered the costs of transfer programs, and the Government initiative to ensure everyone has a bank account makes these options more feasible. 24 To improve efficiency of agricultural support Food (social protection)
Editor's Notes
- #3 For India, the data in the table are for 2010 – to provide a comparison between India and the worldwide status of rural poverty. The latest estimates for India (2011/12) show a significant decline in the number of rural poor to about 217 million. Between 2010 and 2030 the total population in India is projected to increase by 270 million people (22% increase from 1.21 billion to 1.48 billion). The rural population is projected to increase by 60 million (7% from 833 million to 893 million), while the urban population is project to increase by 210 million (56% from 373 million to 583 million). Assuming similar net fertilizer rates in urban and rural areas, the urban population is projected to increase by 84 million from expanding families of existing urban dwellers (22% increase), with 126 million from urban migration (210 million – 84 million). If we assume both the poor and non-poor migrate at the same rate, then the share of poor who migrate = the share of the poor in rural areas which for India in 2010 was 34% in 2010. This translates into about 40 million poor people migrating (126*34% = 43 million) rural is projected to increase by 7% from 833 million to 893 million,
- #5 Derived from Alexandratos and Bruinesma (2012) using 2015 as the baseline, rather than 2005-07 as in their analysis.
- #10 156 million households engaged in farming, average household size in 4.5 people in rural areas (about 700 million people dependent on agriculture) Even though the share of employment in agriculture has been slowly declining, its only since 2000 that the absolute number of workers in agriculture are starting to decline – mainly moving into non-farm rural construction. Every year there are about 12 million new entrance into the workforce. But between 2004/5 and 2011/12 urban jobs increased by 20 million, and rural fell by 9 million, with a net addition of 11 million jobs, meaning 1 million without jobs annually (information from the India poverty team). Pace of job creation needs to pick-up in both urban and rural areas. Given small and falling farm sizes, need dual approach of raising farm productivity and increase employment opportunities in the rural non-farm sector.
- #14 Greater intensity and variability in monsoon: For global mean warming approaching 4°C, a 10 percent increase in annual-mean monsoon intensity and a 15 percent increase in year-to-year variability of Indian summer monsoon precipitation is projected compared to normal levels during the first half of the 20th century. Increased frequency of extremes: an extreme wet monsoon that currently has a chance of occurring only once in 100 years is projected to occur every 10 years by the end of the century. Slower wheat growth at higher temperatures: Wheat growth in India has been shown to be very sensitive to temperatures greater than 34°C
- #16 Baseline water stress measures total annual water withdrawals expressed as a percent of the total annual available flow (accounting for upstream consumptive use); higher value indicate more competition among users. India most intensively irrigated country in the world – but now a global water hot-spot
- #17 A lot of attention is very correctly focused on the North-western and Western parts of India where ground water tables have already fallen to critical levels – an outcome of policies that we all know very much about. But this figure shows an emerging trend most do not tend to focus on but is potentially a huge risk for India – the falling ground water levels just prior to the monsoons in the North-central and Eastern parts of the country, which are endowed with much better rainfall. Given the impact of monsoon fluctuations on agriculture, as highlighted in the recently completed study by the Bank on Agricultural Productivity in India, this poses a serious threat to resilience in face of normal monsoon fluctuations going forward – not to mention the general consensus on predictions of climate change that India will likely face more variable and higher intensity rainfall in future. Clearly more efficient and sustainable use of ground water is critical to meet this challenge – not only in the critical parts of Western India but along the entire gangetic plain that houses the world’s largest concentration of poverty.
- #18 40% of the world’s undernourished children are in India – twice the rates of SSA and 5x of China. Economic costs are huge – potential losses of GDP of 2-3% and more than 10% potential reduction in lifetime earnings for each malnourished individual. India loses $12 bill in GDP to vitamin and mineral deficiencies. Evolution of the food system should learn lessons from the developed world to ensure healthier, more nutritious practices and processed foods to avoid the similar level of obesity and associated non-communicable diseases that pressure public health systems.
- #22 Farm size distribution: 7.4% households are landless; 75% marginal (less than 1 ha); 10% small (1-2 ha). Largest multiplier effects in manufacturing sector -> jobs, growth and transformation
- #23 On the importance of sanitation/environmental health to improve nutritional outcomes, please do mention the “Swacch Bharat Abhiyan” (The PM’s clean up India initiative including ODF) – the Bank is supporting a new $500M project on this. Could mention that we are working in a holistic manner to improve nutritional outcomes – our new projects in Andhra Pradesh and Telengana include nutrition-sensitive agriculture; health, nutrition and sanitation interventions. You could also mention here that the private sector also has an important role to play. Interestingly there is an article in The Economic Times today where the GSK Consumer President talks about wanting to support GOI on the nutrition agenda – pitching for a “Swasth Bharat” (a healthy India). Am attaching it for your refer
- #24 India: accounts for 22% of world rice production, 22% of world rice consumption. World exports only 8% of production! So India’s consumption is over 300% of all currently traded rice globally! A 10% production shock would amount to 33% of current exports from the rest of the world, but considering that India’s consumption is less than production, net excess demand would be 6% of ROW exports. Story for wheat is a bit different: 13 percent of world production and 12 percent of consumption, compared to total global exports of 21% of total production. Production shocks would still have a significant impact on world markets with a 10% shocking resulting India seeking to secure 4% of ROW exports to meet current consumption levels.
- #25 $56 billion (current agricultural subsidies) shared evenly among total population of 1.2bn (with no transaction costs) = $47 per year person per year, 13 cents per day. $56 billion (current agricultural subsidies) shared evenly among the poor (1.2bn * 23% poverty rate = 276 million poor people) = $203 per person per year = 57 cents per day. Adding this to the average incomes of the poor of 96 cents per day would increase incomes to $1.53, above the $1.25 per day poverty line.