Sunday, August 14, 2011

If land is being unused or under-utilized in poor regions across Africa and Southeast Asia, outsourcing to capital-rich and land-poor nations could help prevent another global food crisis, but it must be fair and productive, Adam Wolfe writes for ISN Security Watch.

From Mexico to Pakistan, citizens took to the streets last summer to protest what they saw as their government's inability to do anything about skyrocketing food prices. In Burkina Faso, rioters shut down main streets in three cities and burned government buildings; police used teargas to turn back about 10,000 protesters in Bangladesh; and a series of deadly riots forced out the Haitian prime minister.

Shaken, governments in the Middle East and Asia moved quickly to ensure empty stomachs could not threaten their control. The cure, however, looks nearly as bad as the disease.

Middle Eastern and Asian governments have been buying up underproductive farmland across Africa and Southeast Asia to grow crops that will be exported back to the home country. The International Food Policy Research Institute (IFPRI) estimates that as much as 20 million hectares, twice the cropland area of Germany, will be leased under such agreements in 2009.

The deals are not for the faint of heart. One of the reasons the land is underproductive, and thus an appealing target for these governments, is that it is largely in politically unstable countries. Sudan and Pakistan top the list, but even where there is political stability, selling potentially productive farmland to foreigners can prove disruptive. South Korea's Daewoo arrangement to lease 1.3 million acres in Madagascar helped to spark a coup in March; the new government quickly canceled the deal.

Still, the world's growing population and taste for meat will require more productive farming. If land is being unused or under-utilized in poor regions across Africa and Southeast Asia, money from capital-rich and land-poor nations could help prevent another global food crisis.

International organizations around the world are now trying to find a way to do this that is both fair and productive. The right policy mix might be able to bring down food prices and pull some of the world's poorest out of poverty.

Outsourcing farming for food security

The need for food security is a critical element in a nation's quest for acquiring a status of pre-eminence in international arena. Among the elements of national power defined by Hans J Morgantheau in 'Politics Among Nations', food security is an essential element, the others being geography, natural raw materials, industrial capacity, military preparedness, population, national character, national morale, quality of diplomacy and quality of government.

The military supremacy of erstwhile colonial powers of the 19th century i.e., the UK, Germany, Japan and others was challenged when their Blue Water naval capability could not ensure unobstructed food imports. The Post World War II political-military-economic world order has been dominated by the US and erstwhile Soviet Union (now Russia), primarily because they had a large territory and a self-sufficiency in food and other natural resources.

Indian government realised the criticality of maintaining self-sufficiency in food only after the disasters of 1962 and 1965 wars. The green revolution of the late 1960s turned out to be only a temporary solution wherein 4-5 north Indian states were to be grain basket for the country in its endeavour towards self-sufficiency in food.

However, declining agricultural productivity and a need for feeding a rapidly growing population with rising levels of food consumption has made it obligatory to undertake urgent measures more than just giving subsidies, loan waivers etc. The expansion of cultivable land, both within the country and overseas, could be a possible solution.

Even as outsourcing in IT and ITES has been impacted by a recent wave of protectionism in the US and Europe, outsourcing of farming and farmlands is emerging as a major opportunity. This can also help control price spikes such as seen during 2007-08 when some largest foodgrain exporting countries such as Russia, Argentina and Vietnam had curbed exports in a bid to control domestic price rise. In a recent report by International Food and Policy Research Institute, it has been stated that many governments, either directly or through state-owned entities and public-private partnerships, are making overseas arable land leases, concessions or outright purchases.


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