M A Taslim | Published: January 26, 2022 Financial Express
Since the emergence of Bangladesh as an independent country the principal objective of its agricultural policy has been the attainment of self-sufficiency in food production. The tragic experience of the early years, when the country suffered from severe food shortages and was struck by a devastating famine (1974) in which a large number of people perished from a scarcity of food, entrenched the extreme importance of this objective in agricultural policy. Successive governments made serious efforts to increase food production to prevent a recurrence of such a tragic event. These efforts bore fruit – food grain production rose by three and half times by 2014-15. Considerable success was also achieved in vegetable, poultry and fish production. These helped to raise food consumption significantly. Our ministers, especially agricultural ministers, wasted no opportunity to inform or remind the people of their contribution in achieving self-sufficiency in food grain production.
However, such a claim bemuses the general public. In ordinary parlance ‘self-sufficiency’ in any product implies that the country produces sufficient amount of the product to meet the entire domestic demand such that no import is necessary. Since, in today’s world, most products are both exported and imported, the definition of self-sufficiency is usually broadened to indicate a market situation where net export, i.e. export less import, of the product is non-negative. If the net export is negative, i.e. there is more import than export, there is a deficit. It so happens that Bangladesh has always imported very substantial quantities of food grains (meaning rice and wheat) to meet the domestic demand in excess of production, and it has never exported significant amounts of food grains. This should normally imply that the country was never self-sufficient in food production, i.e. it was always in deficit. Hence, the contrary claim made by the ministers and others seemed to be misleading.
The reason for these divergent views about self-sufficiency is most likely that the ministers did not use the definition above when claiming self-sufficiency; they perhaps used a calorie-based concept developed in the early years of the country, which is still used by a section of the analysts in this subject including government officials. In the early days the most pressing problem facing the policy makers was to ensure the supply of sufficient food for the population that would provide the minimum calories required for maintaining health. The minimum amount of calories so required was estimated by various organisations such as Bangladesh Bureau of Statistics (BBS), Institute of Nutrition and Food Sciences and Food and Agricultural Organisation (FAO). For example, the minimum amount needed to meet the nutritional norm was estimated by BBS at 2122 kcal per day. It was then estimated how much of food grains per head per day would be needed given the consumption habits to ensure the estimated amount of calories. The yearly requirement of food grains was then easily calculated. This was multiplied by the midyear population to arrive at the total amount of food grains required by the country per year. If it produced any amount in excess of the estimated amount, it was regarded self-sufficient in food. By this criterion Bangladesh was self-sufficient in food from the beginning of this century (for a discussion see R. K. Talukder, Bangladesh Development Studies, 2005).
There was some logic in the use of this definition of self-sufficiency when the country did not produce enough to meet the minimum calorie requirement to maintain health. The gap showed the extent of government intervention necessary to prevent hunger and the consequent morbidity or early mortality. But when the food output exceeded the minimum requirement, this definition lost its operational utility. To claim self-sufficiency in food production, more than two decades after the country has become self-sufficient by this definition, is orotund and without any operational significance.
When consumption is not constrained below the minimum, the market-based definition mentioned at the beginning is far more useful both conceptually and operationally. Importantly, it could be the basis for appropriate policy interventions. If an evolving shortage in the food market could be forecasted with reasonable accuracy, the government would have sufficient time to take corrective measures (e.g. import and stock augmentation), to prevent market instability.
When the market based definition is applied, self-sufficiency of Bangladesh in food production fades away and a large deficit emerges. Indeed ever since its birth Bangladesh has been a chronic food deficit country which had to be offset by food import. The deficit was slowly declining until the beginning of this century, but since then the deficit has been rising (all data are from Index Mundi). It has really shot up during the last five years when the average import of food grains per year as a ratio of domestic production rose to 19.1 per cent. The average was considerably lower at 11.5 per cent during the last century (1972-73 to 1999-2000). It would seem that contrary to the calorie-based self-sufficiency claim, the food deficit is actually worsening quite rapidly.
Another alarming trend is the stagnation in the output of the principal food grain rice (as well as wheat which accounts for only 3.0 per cent of the total grain production). The rapid pace of agricultural modernisation sustained a robust growth of rice output at 3.3 per cent per year during the last century (1972-2000). But since then the growth rate tumbled to only 1.8 per cent during the period 2001-21, and even less at only 0.75 per cent during the more recent period 2011-21. Even more alarming is the fact that the average growth rate of rice output has fallen below the population growth rate since around 2008, and there has been virtually no growth in rice output during the period 2013-20. It would seem that the high yield rice technology that was so successful during the last century has lost steam in the more recent years. Unless the agricultural scientists can find methods to raise the growth rate of the output of food grains, the importation of food grains will rise even higher. The following back of the envelop exercise will make this clear.
Given the current demographic trend, we may expect the population of the country to grow at an average rate of 0.9 per cent per year for the next decade or so. If the country can maintain a growth momentum of gross national income (GNI) of at least 6.9 per cent, the per capita income would rise by at least 6 per cent. If we assume that the income elasticity of demand for food grains is 0.2, then the total demand for food grains would increase by about 2.1 per cent per annum over the next decade, which is incidentally almost the same as the actual annual growth rate of food demand during 2000-21. This would mean that the domestic demand for food grains in 2031 will be 54.26 million tonne. Now if we further make the bold assumption that the food grain production of the country will increase during the next decade at the same rate as it did in the new millennium (1.75 per cent), then the total food grain production will be 43.12 million tonne. If production grows at a lower rate, the total output would be lower.
The challenge that we might encounter in the next decade is suggested by this simple exercise. Even under fairly optimistic assumptions, we are looking at a food grain deficit of more than 11 million tonne by 2031, which is about twice the amount of average annual import during the last one decade. The only way we could reduce this deficit is by raising production at a much higher rate than what we have achieved so far in this millennium; but the experience of the last decade does not inspire much hope. The other option would be to switch to other food crops, but there is no guarantee it would reduce the deficit. Any increase in the production of other food crops would require reducing land under food grains given the absolute scarcity of land, and the increment in non-food grain crops could be less than the loss of food grains thus requiring more, rather than less, import of food crops.
It is evident that Bangladesh is facing the prospect of a very large increase in food grain deficit, and hence import, in the next decade. It is advisable that the very misleading calorie-based concept of self-sufficiency be dropped outright from policy discussions since such a concept can easily mislead policy makers in the wrong direction. The focus now should be on food security which is the basis of food policy in the more affluent countries. Food security refers to the ability of the nation to provide access to adequate and nutritious food to the entire population. This can be achieved by either producing sufficient nutritious food, or by exporting other products to earn sufficient foreign exchange to buy food from the world market, or a combination of both. Some of the most well-fed countries, such as United Kingdom (UK) and Saudi Arabia, have very large food deficits, but they can import the food needed with their large cache of foreign exchange earned by the export of other commodities. As long as Bangladesh can mobilise sufficient foreign exchange to buy food grains it can do the same indefinitely.
However, a small country like Bangladesh cannot always depend on the world market or contractual obligations of other countries in the event of political conflicts or emergencies. Such situations arose at least twice in the past. The first is the well known case of the American diversion of food shipments in 1974 that is believed by many to be a contributory factor of the famine. The second was the sudden imposition of a ban on rice export by India in 2008, which destabilised the world rice market and pushed up the rice prices massively. (It is also well to remember that even after forward purchasing corona vaccines with cash from India, Bangladesh did not get the vaccines in time because of a corona emergency in India). Since the possibility of adverse conditions springing up in the future cannot be discounted, Bangladesh must have a contingency plan to ensure the stability of the domestic food market to avoid suffering the worst outcomes. The current arrangements may not be adequate if an unexpectedly severe situation develops. For such contingencies, effective safeguard measures, such as warehousing on a large scale, will be necessary. The relevant ministries must build up the capacity to both do state-of-the-art forecasts of the future domestic and international food market situations and then act quickly to forestall or reduce the impacts of unwelcome exigencies.
The author is an economist.
