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If you haven’t read first four chapters, read them here first,  Chapter two, Chapter three, chapter four

Despite the high economic growth during the last two decades, India has not been able to improve it’s maternal and child health indicators at the desired pace. We failed to achieve health goals related to Millennium Development Goals(MDGs) and our maternal and infant mortality remains unacceptably high.

India is in the middle of a demographic dividend which is going to last till about 2035-2040 (25 more years or one more generation) and it’s imperative that we invest in human capital to reap the fruits of demographic dividend. This will raise our long run economic growth potential.<What is demographic dividend? How does it help raise long run growth potential? Answer in the comments below.>

In this context, economic survey argues that given fiscal constraint <we can only spend as much as we tax plus some borrowing, never behave like arm chair pundits asking to raise budgetary allocation for everything without raising any taxes or train fares or bus fares> and state’s limited capacity to deliver public services <we know how state i.e. govts mess up almost every sector they get into, just see the performance of public schools i.e. state should not take tasks beyond it’s capacity; first improve capacity and then take additional tasks; just passing RTE or establishing 5 more AIIMS or IITs is not enough>, state should invest in relatively low cost maternal and early life health and nutrition programmes.

What’s the rationale behind investing in mother and child?

Intrinsic reasons– it improves quality of life directly and expands possibilities for the individual <if someone is not born healthy, chances are he would be unhealthy in later life as well>

Narrow economic logic

1. Research has shown that countries with better maternal and infant health “at takeoff” grew faster over the subsequent 20 years. <takeoff stages is similar to takeoff of an airplane, slow growing economy suddenly starts to grow very fast. For instance, China post economic reforms in 1979>
2. Tomorrow’s worker is today’s child or foetus and  events which occur while a child is in the womb i.e inside pregnant mother or very young (<2 yrs) affect cognitive development and health status even in adulthood i.e. if today’s child is weak, chances are tomorrow’s worker would be less productive.

Why does health of new born affects outcome much beyond the childhood?

1. the most rapid period of physical and cognitive development in a person’s life occurs in the womb <rapid development phases are most susceptible to environmental insults>
2. Dynamic complementarities in human capital accumulation- it simply means one human capital for instance health would affect accumulation of other human capital for instance education and training/skill in a dynamic way and vice versa. For instance healthy mother # healthy baby # learns better <cognitive development better in the womb as mother is healthy> and stays on in school longer. Or consider # unhealthy mother # weak baby # learns less and stays in schools for shorter period # less skilled and competent 

• research has shown that low birth-weight children benefit less from early-life cognitive stimulus programs i.e. early we intervene the better i.e. investment in mother and fetus. very young children
• success of subsequent interventions—schooling and training—are influenced by early-life development
• programs targeting younger children also appear relatively cheap in comparison to investments made in older children. For instance, iodine supplementation is way more cheaper compared to improving teacher quality or re-designing institutions to raise school accountability <good for fiscally constrained govt.>, also requires less service delivery capacity from the state, for instance, improving teacher quality would require teacher training, monitoring that they actually show up and teach in schools <investing in mother and child good for capacity constrained govt.>

The Dismal State of (Child’s) Play in India

Height is a good proxy for early life conditions and height is determined by early life environment and net nutrition.

“net nutrition” is defined as the sum total of (i) the nutrition available from the mother in the womb and during breastfeeding, (ii) the quantity and quality of the food that complements breast milk from 6-24 months, and (iii) energy losses due to disease and infection, and poor absorption of nutrients. <part 3 is an important cause of malnutrition in India due to open defecation and subsequent infections resulting in reduced absorption and increased losses in feces as well as due to high metabolism during infections>

Quick statistics

1. 48% of under 5 children are stunted (low height) compared to 39% in Sub Saharan Africa
2. 43% are underweight compared to 20% in Sub Saharan Africa
3. 28% are born low birth weight compared to 13% in Sub Saharan Africa

This data is taken from Amartya Sen’s book An Uncertain Glory which took data from UNICEF(2012). This condition of poor nutrition indicators comapred to much poorer and war torn Sub Saharan Africa is known as South Asian Enigma or The Indian Paradox and the low status of women is cited as one of the explanation.

3 quick points about height for age in India

1. there has been improvement over time in both urban and rural India
2. there is a persistent rural-urban height gap which has not closed over the past decade
3. despite the progress made, India remains a negative outlier—our children are on avg shorter than healthy children

Consequences-height-cognitive development gradient

Greater the height, greater the cognitive development (of course corrected for genetic potential for height not that because Chinese are short they are less smart then tall Caribbeans)

• taller Indian children are considerably better readers than shorter ones (height proxy for nutrition which affects cognitive development)
• absolute reading ability has not increased over time i.e we have not made much progress in addressing the nutrition and education challenge

Clearly much more needs to be done to improve the nutrition situation in India.

The Dismal State of Maternal Health

As we have already discussed first 1000 days of life (nine month in womb plus 2 years) are most critical for a child’s development. They depend critically on maternal health (esp 9 months in the womb)

70% of infant mortality (children who die before reaching their 1st birthday) is due to neonatal mortality(dying before 1 month). A leading cause of this is low birth weight which is clearly due to poor maternal health and nutrition.

Consider this data-

1. 42.2% of Indian women are underweight at the beginning of pregnancy
2. 50% of pregnant ladies are anemic(low hemoglobin in blood) <data from An Uncertain Glory>
3. Women from richer households in India start pregnancy heavier,suggesting that resources are at least part of the reason for low pre-pregnancy weight <poor #less to spend on nutritious food #low pre pregnancy weight>

No surprises then that women in India gain only about 7 kgs during pregnancy, substantially less than the 12.5- 18 kg gain that the WHO recommends for underweight women.

Very very important sociological insights

Use these observations in paper 1 (society) and essay. They will certainly add value to your answers.

1. reason for poor maternal health is that social norms accord young women low status in joint households. <When compared across the same ages, till about age 35, fraction of underweight women exceeds that of men by at least 5 percentage points. > within-household nutritional differentials are stark
2. lower status of younger daughter-inlaws in families. <children of younger brothers in joint family households are significantly more likely to be born underweight than children of their older brother> Chacha’s children more likely to be born low birth weight than Tau’s<Tijori ki Key Badi bahu ke haath mein>
3. Indian firstborn sons are found to have a height advantage over African firstborn sons, and the height disadvantage appears first in second-born children, increasing for subsequent births<preference for healthy male heir>

Improving Maternal Health in India

Clearly much more needs to be done to improve maternal health.

Govt response-. The National Food Security Act of 2013 legislated a universal cash entitlement for pregnant women of at least 6,000 rupees.

But it will only be successful if families convert these payments into more, higher-quality food and more rest for pregnant women and to make sure it happens, the cash transfer could be paired with education about how much weight a woman should gain during pregnancy and why weight gain during pregnancy is important. <cash transfer plus health education>

You can follow the whole women empowerment story, click here

Universal v/s conditional cash transfers

Should cash transfer be universal i.e given to every pregnant women regardless of what she does with that money or conditional on women performing certain tasks such as visit hospital regularly, getting delivered in hospital, vaccinating her child etc as in Indira Gandhi Matritva Sahiyog Yojana (IGMSY)?

Conditional cash transfer seems better but it entails high administrative costs, delays and often lead to significant exclusion. Hence survey suggests the cash transfer should be given in a single, lump-sum payment early in pregnancy to avoid delays, reduce administrative costs, and ensure that it is possible for the household to spend the money on better food during pregnancy.

Case for going universal and problems with conditional cash transfer

With careful design and significant investment of state capacity, maternal health could be significantly improved during pregnancy.

The problem of open defecation

Facts-open defecation in India is much more common than in even much poorer countries <61% in rural India v/s 37 % Nepal, 32% rural Sub Saharan Africa, just 1.8% B’Desh>

Only lack of toilets or income constraints is not the reason, but there are sociological reasons

Fact- many people in rural India who live in households that contain working latrines that are in use by other household members nevertheless defecate in the open.

Research suggests that rural Indian households reject the types of latrines promoted by the WHO and the Indian government partly because their pits needed to be emptied every few years and empty the latrine pit is associated with the strong notion of purity and pollution <history of untouchability- work of disposing of human faeces is associated with severe forms of social exclusion and oppression>

Consequences- disease, diarrhoea, environmental enteropathy (reduced absorption of food) resulting in less amount of net nutrition available to kids as we discussed above.

Building toilets and ensuring people defecate in the open is an example of public good as even those who don’t defecate in the open get sick due to germs from people who defecate in the open.

Addressing open defecation

Govt. response- swatch Bharat Abhiyan

• In the last year alone, the government built over 80 lakh toilets
• UN’s Sustainable Development Goals commit to ending open defecation worldwide by 2030

Historically, open defecation in India has declined by about 1 % per year  <about 50 years before India becomes open defecation free>. We need to more than triple the rate of reduction to achieve SDG. For that, it is important to understand barriers to toilet adoption in rural India and promote latrine use <as we just learnt, it;s much of a sociological, behavioral problem>

Influencing social norms to make investment yield better return

A big challenge is deeply entrenched norms and facilitating behavioural change. One can build clinics in villages or transfer money to pregnant mothers or build latrines, but how does one bring out the right usage of all this physical capital ?

Govt has a progressive role to play in changing norms, and thus the importance of high pitch campaigns such as Swatch Bharat Abhiyans.

The government has recognised the importance of influencing social norms in a wide variety of sectors—

• persuading the rich to give up subsidies they do not need (give up lpg subsidy campaign)
• reducing social prejudices against girls (selfie with daughter)
• educating people about the health externalities of defecating in the open (swatch bharat)
• and encouraging citizens to keep public spaces clean (swatch Bharat)

Way forward-

• Invest more resources in understanding the behavioral patterns and how to change them
• Create a Nudge unit within government for behavior change communication as other countries have done
  

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You might want to read- Blog from CD published on The Better India

7 Rights Every Pregnant Woman in India Should Know About (govt schemes for pregnant women in short, imp for exam)

Open all the hyperlinks. Learn, understand and revise

Ask all your doubts in the comment section below or in doubts clearing forum . All your suggestions, criticism and feedback are most welcome.

If you like what you read, show your support to Civilsdaily and give us a hi 5 at the Android Play – Click here.

If you haven’t read first three chapters, read them here first,  Chapter two, Chapter three

India lives in villages and agriculture is the soul of Indian economy- Mahatma Gandhi

“Most of the world’s poor people earn their living from agriculture, so if we knew the economics of agriculture, we would know much of the economics of being poor.”- Theodore Schultz, Nobel laureate

As per NSS data avg annual income of the median farmer net of production costs from cultivation is less than Rs 20,000 (avg per cpaita income at current prices is about 98000 per annum in India)

Post independence agricultural success

• Chronic food shortages of 1960s (recall PL 480 programme) have given way to  grain self-sufficiency (not nutrition self sufficiency) despite a two-and-a-half fold increase in population.
• In 1966-67, Indian wheat and milk production were just about 1/3 of US output.  Contrast it with recent figures with wheat output being 60% higher than America’s, while milk output being 50% higher. (Result of green and white revolution)

This seems like a remarkable success. Then, what’s the problem with Indian agriculture?

• Indian agriculture has become cereal-centric (wheat and rice production to the neglect of pulses and oil seed production even though demand for protein based items is rising)
• It is regionally biased (Punjab, Haryana, western UP cornering all agri subsidies) and input-intensive, consuming generous amounts of land, water, and fertiliser
• Input intensive cultivation means there is sharp decline in cultivable land available per capita as also much lower levels of water per capita
• Challenge of climate change – erratic monsoon, more frequent flood and droughts
• Challenge of income- As we mentioned above avg income of farmer from agriculture is just 20000 per annum.

Let’s discuss some major issues with agriculture

1. Productivity/ Yield-  low productivity esp. in pulses is the central challenge facing Indian agriculture.

Consider the case of wheat and rice-

As already stated, Indian agriculture has become cereal centric and input intensive and these two crops are grown on most fertile tracts with irrigation facilities and corner bulk of agri support available to all crops across country. Yet, if we compare average yield of wheat and rice in India with China, we find that

1. avg yields of wheat is 39% below China and in case of rice 46% below that of China’s.
2. In wheat save for Punjab and Haryana, most states have yield lower than that of B’desh
3. In paddy even Punjab trails behind yield level of China while other states trail behind even B’desh.

Now if we compare productivity in pulses of which India is topmost producer, consumer as well as importer, yield gaps are even more stark.

1. On an avg, countries like Brazil, Nigeria, and Myanmar have higher yields
2. even the key pulse producing state of M.P. has 60% yield of China’s

Take home message from above analysis-

• Yield gap varies among states in India and we could make rapid gains in productivity through convergence within India
• For instance, in pulses, if all states were to attain even Bihar’s level of productivity, pulses production would increase by an estimated 41% on aggregate and we would be self sufficient in pulses

Why is pulses productivity so low (land related reasons)

• Most of the land dedicated to growing pulses in each state is unirrigated
• National output of pulses comes predominantly from un-irrigated land

Issue of Intensive use of water (problem of Indian agriculture becoming highly input intensive)

• Although water is one of India’s most scarce natural resources, We use 2 to 4 times more water to produce a unit of major food crop than does China and Brazil.
• We have invested in flood irrigation method (canal and tube wells) which is highly inefficient way of using water
• Also despite being water scarce, we are virtually exporting water by exporting water guzzling crops such as paddy, sugarcane, cotton also meat (not exactly crop)
• India now exports about 1 per cent of total available water every year (demand of 13m people)

Reason for inefficient use of water-subsidies on power and water for agriculture.

Result– water tables are declining at a rate of 0.3 meters per year

Solution-  shift to sprinkler and drip irrigation and rainwater harvesting.

• Leverage MGNREGA labour to build rainwater harvesting structures.
• accord “infrastructure lending” status to these new technologies (infra lending status decreases cost of borrowing to invest in these technologies)

Govt. response– Convergence of various schemes under PM krishi Sinchai Yojana which will help in convergence of investments in irrigation, from water source to distribution and end-use i.e. at individual farm level.

What is drip irrigation?

• A type of micro irrigation method in which perforated pipes are placed either above or slightly below ground and drip water on the roots and stems of plants, directing water more precisely to crops that need it
• It reduces consumption of fertiliser (through fertigation ) and water lost to evaporation, and higher yields than traditional flood irrigation <Fertigation is the process of introducing fertiliser directly into the crop’s irrigation system.>

Problem in adoption of drip irrigation- high initial cost of purchase and the skill required for maintenance.

Solution- the increase in yields and reduction in costs of power and fertiliser use can help farmers recover the fixed cost quickly. Hence, provision for credit to farmers to adopt this technology.

But there are teething troubles in agri finance as mentioned in last year’s economic survey box-

Problem of agri finance-

1. 40% of agri finance still by informal sector
2. 26% by usurious moneylenders
3. Share of long-term finance i.e. capital loans in overall credit going down over the years (70% in 1991 to 40% in 2011)
4. Share of small loans decreasing (less than 2lakh rupee loan from 78% of total in 2000 to 48 % in 2011 and 10 lakh and above from 8% in 2000 to 28%in 2011) March rush (jan to march quarter) in loan disbursal i.e. loan in lean season to comply with PSL
5. More and more agri loans going to urban and metropolitan areas

Implication of all this is that lending to agriculture is grossly misallocated # largely to ;arge farmers # not being used for capital formation # worst of all may not even be going into agriculture.

Issue of Minimum support Price (MSP) and Procurement being cereal centric and regionally biased

• while the government announces MSP for 23 crops, effective MSP-linked procurement occurs mainly for wheat, rice and cotton and indirectly for sugarcane via sugar mills
• Even in these crops majority of procurement is from Punjab, Haryana, Western UP.
• Poor farmers aof Rajasthan and Jharkhand are not even aware of any such MSP policy

Result– Regional disparity, excess stock of wheat and pulses and import and volatility in prices of pulses.

Solution-reorienting agriculture price policies, such that MSPs are matched by public procurement efforts towards crops that better reflect the country’s natural resource scarcities i.e. provide higher MSP for those crops which we import such as pulses and oil seeds and at the same time procure thise crops so that MSP policy is effective on the ground.

One way we discussed in chapter two was to not only taking economic but social and environmental costs and benefit into account while deciding MSP. Copy pasting from chapter two

• Eg. Costs of producing cereals in Punjab and Haryana; declining water table, soil quality degradation, post harvest burning of stalks causing pollution, rich farmers getting benefits
• v/s benefits from pulses; nitrogen fixation, lower import dependency etc.

For cereals a system of Price Deficiency payment can be instituted

Under this system if the price in an APMC mandi fell below the MSP then the farmer would be entitled to a maximum of, say, 50% of the difference between the MSP and the market price. This subsidy could be paid to the farmer via Direct Benefits Transfer (DBT)

For eg. If say MSP for wheat is 100 rs per kg. In present scenario, govt would procure it at 100 no matter if market demand is very low and prices some 10 rs per kg. Farmer has no incentive to switch to other crops to reflect market demand.

But in price deficiency payment, he will receive only 10 + (1/2*100-10) = 10 + 45 = 55 rs. It protects farmers while signalling him to produce crops reflecting market demand.

Issue of Agri Research and extension 

Agricultural extension is the application of scientific research and new knowledge to agricultural practices through farmer education. Basically educating farmers about the latest technologies being developed in the labs i.e. lab to land linkage.

While Indian Council of Agricultural Research (ICAR) with agriculture research universities played a key role in the Green revolution. Of late agriculture research has been plagued by severe under investment and neglect.

Three key weaknesses

1. Agri education is weak in states due to (i) resource crunch, (ii) difficulty in attracting talented faculty, (iii) limited linkages and collaborations with international counterparts, (iv) weakening of the lab-to-land connect; and, (v) lack of innovation
2. Low investment in public agricultural research in India. As share of agriculture GDP, it is even less than that of Bangladesh and Indonesia
3. Majority (63.5 per cent) of scientists have low to very low level of productivity

Solution

• There is need of instituting performance indicators in universities.
• Improve investment as a proportion of agri GDP
• securing participation from the private sector
• instituting a system in which the winner is offered a proportionately large enough award for innovating desirable agricultural traits (such as improving pules productivity considerably) but the intellectual property rights of the innovation are transferred to the government
• Leverage mobile phones to provide timely information to farmers
• Leverage the potential of drones (UAVs) to provide crucial information on crop health, irrigation problems, soil variation and even pest and fungal infestations that are not apparent at eye level to farmers
• Improve regulatory process to address concerns against GM crops while adapting high yielding technologies

Agriculture market segmentation

Last year’s economic survey mentions, effectively, India has not one, not 29 but thousands of agricultural markets.

Why are so many markets bad?

Whole capitalistic economy is dependent on trade, competition and specialisation and so many markets prevent that thus reduces overall welfare because it prevents gains through competition, efficient resource allocation, specialization in sub sectors (everyone has to produce everything as they can’t trade with others resulting in jack of all trades master of none) and fewer intermediaries. 

• If there were one common market, prices would be same from Kashmir to Kanyakumari and Dwarka to Puri (don’t add transport and storage cost please).
• In USA which has a common market, maximum price variation is in case of peanuts with highest prices being 1.75 times that of lowest prices. Remarkably it is lower than India’s minimum price variation crop Tur dal.
• It creates particular problem for perishables such as fruits, vegetables, onions, hence sudden and sharp spike in prices in one area while being sold at throwaway prices in some other area

Solution-

• Pass GST bill
• Create common national agriculture market
• Create better physical infrastructure
• Improved price dissemination campaign
• Remove laws that force farmers to sell to local monopolies i.e APMC act

What you have to read for yourself

1. All the figures which are basically curves
2. Open all the hyperlinks. Learn, understand and revise
3. Read chapter eight A National Market for Agricultural Commodities- Some Issues and the Way Forward  from last year’s economic survey to understand concepts behind need for common agri market

Ask all your doubts in the comment section below or in doubts clearing forum . All your suggestions, criticism and feedback are most welcome.

If you like what you read, show your support to Civilsdaily and give us a hi 5 at the Android Play – Click here.