In a poor country, roughly about 60%-70% of the energy requirement of consumers in villages and even poor consumers in cities living in the slums comes from the cereals, that is the cheapest source of pure energy intake. So what is happening to food grains production is of very vital importance in poor developing countries and that is where the World Bank policies have impacted hardest. They have impacted in many areas, but this is an area which affects the actual living standards of very poor populations and which is pushing them down to below subsistence level.

Now, in our agriculture from 1991 onwards, the attack has come both on the supply side and on the demand side, that is, as government has cutback on investment in agriculture, the growth rate of material production of the food grains as well as the non-food grains has become about half. The annual rate of growth of output was in excess of 2.7% per annum during the decade of the 1980s. In the case of food grains, it collapsed to only 1.7% per annum during the decade of the 1990s, and it fell below the population growth rate in India for the first time ever since the mid-60s' crisis.

The other component of this decline in food grains output growth rates has been area diversion to exports as again as part of the entire World Bank/IMF set of policies. The agricultural sector has been opened up to global trade. Growing exports means a very sharp fall in the per capita availability of food grains for the domestic populations. The decline in per capita food grains availability in British-India has been well documented, from 200 kilograms average in the year 1900 to 136 kilograms average annually by the year 1946. That is roughly the availability that a lot of sub-Saharan African countries have now and they are perpetually on the verge of famine. A little shock to the system and they have to go with begging bowls and usually that is not enough so people actually starve.

So, after independence food security was given a lot of importance and the maximum we reached was 182 kilograms in the early 1990s. So, output was being looked after. Then it has started declining. By now it's less than 165 kilograms per head. That is the per capita output. That is the supply side that has been hit by the policies advised by the World Bank which directly advised expenditure reduction, and rural India has been a soft target for that.

But on the demand side, the impact has been even more severe because when the government has cut back on its development expenditures through multiplier effects, incomes have gone down in rural India, and unemployment has risen. Depression in the level of economic activity means growing unemployment, growing lack of purchasing power, and this collapse of purchasing power has been spectacular in rural India. By the year 2002 July, 64 million tons of food grain stocks had built up in the Food Corporation of India, 40 million tons in excess of the normal level for that kind of year. Where were these 40 million tons coming from? They were coming out of more and more empty stomachs as purchasing power collapsed, both in rural India and in urban slums as a result directly of the cutback of development expenditures which is advised and continues to be advised by the World Bank and other International Financial Institutions.