Price rise could diminish reforms: PM

NEW DELHI: The prospect of prolonged food shortages and rising food prices poses a challenge to the world community, Prime Minister Manmohan Singh said on Thursday while accepting the Agricola award from FAO���s head, Dr Kandeh Yumkella.

���A steep rise in food prices will make inflation control more difficult and can thereby hurt the cause of macro-economic stability. Economic reforms would also diminish and pressures would mount for restrictive trade practices,��� Mr Singh said in his address, indicating that this had indeed become a key political worry as well for the ruling UPA, which he heads.

Calling for a new phase in the country���s agricultural growth trajectory, he described food prices as the ���kingpin��� of the price structure in India. Among the gravest concerns in India was the potential of escalating food prices to slow down poverty alleviation, impede economic growth and retard employment generation.

The Green Revolution had run its course and, without urgently adopting new technolgies, organisational structures, institutional responses and a new contract between the farming community, scientists, technologiests, businessmen, bankers and consumers, the world community would fail to tackle this problem head-on, the PM held.

Rooting for a macro-perspective on the issue by nations and governments, Dr Singh held, ���The global community and agencies must fashion a collective response that leads to a quantum leap in agricultural productivity and output so that the spectre of food shortages is banished from the horizon once again.���

Dr Singh firmly ruled out any possibility of the government responding to the crisis through a return to blind controls and by depressing agriculture���s terms of trade. He also signalled that the government was not inclined to sacrifice the interests of producers for that of consumers.

Reiterating his government���s commitment to the promotion of the welfare of the entire agricultural community, he said that a progressive increase in agricultural productivity and incomes was essential both for the removal of mass poverty and for creating an expanding market for industrial products.

Significantly, the PM acknowledged that the world food situation had become more complex due to the biofuel juggernaut factor. ���It is particularly worrisome that the new economics of bio-fuels is encouraging a shift of land away from food crops ,��� he said.

Climate change and global warming, the other key cornerstones of the drastic changes happening in the world food scenario aslo came in for grave concern. ���(They) may have a harmful impact on land productivity and water availability,��� the PM asserted, calling for urgent and concerted global action to grasp the impact of climate change on agricultural production worldwide.