How the world’s top pulse market is dealing with the coronavirus pandemic.
India is at the heart of the global pulse trade. The country’s population of 1.3 billion people consumes an estimated 24-27.6 million MT of pulses annually. Its agricultural sector, comprised mainly of smallholder farmers, produces an estimated 22 -24 MT of pulses per year. To meet its domestic demand, India supplements its production with imports from Canada, Australia, Myanmar, Russia and other pulse origins These facts make India the world’s leading pulse consuming, producing and importing nation.
At a time when the spread of the highly contagious coronavirus has shaken the world economy and disrupted international trade, the Global Pulse Confederation reached out to G. Chandrashekhar, senior editor and policy commentator for the Hindu Business Line, to learn how the top pulse market is coping.
GPC: What has been the impact of the COVID-19 pandemic on India?
Chandrashekhar: Today, March 30th, is the 14th day of the work-from-home order for most business establishments in Mumbai, and the 8th day of the national lockdown. Human activity in the city is extremely limited. Only essential services, such as hospitals, service providers (pharmacists, food and grocery stores, etc.) are allowed to operate. Non-essential businesses are to remain closed through April 14th.
Port operations and trucking have ground to a halt because of the limited availability of labor. Marketing yards are shut down in most parts of the country, causing immense hardship to growers. Considering that rabi crops, like wheat, rapeseed and chickpeas, are ready for harvest, the government is expected to soon lift restrictions on market yard operations.
Simply put, the country is in a state of forced inactivity. Stock and commodity markets have recorded huge slumps. The rupee has depreciated by 8% since the beginning of the year. The lockdown is sure to put a dent in India’s economic growth this year, worsening the slowdown that has been recorded in recent quarters.
GPC: How is the country addressing the pandemic?
Chandrashekhar: India is attempting to cope with the pandemic in different ways. The first is health related, of course. These measures include identifying those infected with COVID-19 and providing treatment, and implementing preventive measures, like social distancing and a three-week lockdown.
Secondly, it is providing aid to individuals, especially migrant workers, daily wage earners, small and marginal farmers, vulnerable households and the like. Free rations, cash transfers and similar benefits have been extended to those most in need. About 800 million individuals are expected to see these benefits.
And thirdly, it is implementing measures to protect the nation’s economy. The key initiatives in this regard include a 75 basis point reduction in interest rates, a massive infusion of liquidity through the loosening of the reserve requirement for banks, and rescheduling the servicing of the debt.
My expectation is that soon the government will come out with a fiscal relief package for the corporate sector, including a possible reduction in GST for affected key sectors, such as automotive, construction, tourism, hospitality and so on.
Especially significant is the announcement that every needy individual will be entitled to 5kg of rice or wheat free of cost every month for the next three months. On top of that, every vulnerable household will also receive 1kg of pulses per month free of cost for the next three months. The grain supply is expected to benefit about 800 million individuals, while the pulse supply will benefit about 160 million families.
This is a significant departure form the past. As they say, extraordinary times demand extraordinary actions. Pulses are part of the government’s emergency welfare program. One kilogram per family per month for 160 million families over the next three months aggregates to 480,000 MT of pulses that will be distributed free of cost.
In my last article, published March 30th, I made the case that the quantum of pulses should be doubled, possibly tripled, in order to help vulnerable households fight protein deficiency. I have also recommended that after the current emergency subsides and the situation normalizes, pulses should be supplied along with rice and wheat as part of the national welfare program at an affordable price. This would truly help India tackle malnutrition and advance food security.
If accepted, this proposal would be a major shot in the arm for the pulse sector, and it would also benefit both pulse growers and consumers. It would create the conditions for India to advance to the next level in terms of both pulse production and consumption. I have always believed that India is perhaps the only country where both pulse consumption and production can take a quantum leap.
GPC: How so?
Chandrashekhar: Within policymaking circles in India, there is possibly a belief that we are self-sufficient in pulses. But I have warned that we cannot remain smug in this mistaken belief.
In one of my columns, I make the case for increasing pulse production by expanding the area seeded to pulses to non-traditional areas and by infusing technology to improve yields, as pulses are vulnerable to pests and diseases, as well as weather aberrations. The critical factor that is needed to boost production is a breakthrough in seed technology. We have not had any breakthrough in seed technology for the past 20 years.
So that’s what we need to take a quantum leap on the production side. On the demand side, there are those who say we achieved pulse self-sufficiency, but India’s pulse consumption is far below what the country should be consuming. At the current levels of domestic production and imports, the per capita availability of dal is only 14kg. Nutritionists recommend an annual per capita intake of 20kg. In a country with severe malnutrition and pervasive protein deficiency, it is the sovereign duty of the government to encourage greater pulse consumption by supplying pulses through various welfare programs. This would help narrow the protein gap and advance nutrition security. If 200 million households are given 2kg of pulses every month, it will help growers and consumers alike. Creating demand through welfare programs will improve crop marketability and help growers. Access to affordable pulses will advance consumer interest.
The decision to supply 1kg of pulses to vulnerable households over the next three months could be the first step toward accepting and implementing this recommendation. This is a humanitarian issue, and I believe it is the responsibility of national and international promotional bodies to lobby the government of India to take action.
Those are my recommendations. They are presently making the rounds among policymakers. We shall see if the political will is there to implement them.
GPC: There have been news reports that in various parts of the world, consumer demand for pulses has spiked because of the pandemic. Are you seeing that in India?
Chandrashekhar: During this pandemic, what we are seeing is that consumers are avoiding meat and poultry products, but there is no empirical evidence yet that they are switching to pulses. There hasn’t been a marked spike in pulse prices.
India has more than 2.2 million MT of pulses in a buffer stock, and we have a large rabi crop waiting to be harvested. Additionally, we have well over 55 million MT of rice and wheat in government warehouses and an estimated crop of 100 million MT of wheat is ready for harvest. So there is no food shortage as such. The distribution logistics under the welfare program are well established. However, providing free rations for three months to 800 million individuals may pose a challenge because of the ongoing large-scale migration of daily wage earners.
GPC: You mentioned the rabi crop. How is it coming along? Has the pandemic had any impact on the agricultural sector?
Chandrashekar: We will have near-record harvests of wheat, rapeseed and pulses. The pandemic has not had any perceptible impact on the country’s agriculture, other than a slight delay in the harvest and the movement of harvested produce to the marketing yards.
In terms of pulses, the main rabi crop is chickpeas, and we also have lentils, field peas and smaller quantities of urad, moong and other pulses. The Ministry of Agricultural estimates total pulse production at 15.1 million MT. However, we had unseasonal rains and hailstorms in March that caused some damage to crops. My sense is that rabi pulse production will be slightly lower, between 14 – 14.5 million MT. This includes 10 – 10.5 million MT of chickpeas, 1.4 million MT of lentils, 700,000 MT of field peas, and 500,000 MT each of urad and moong.
GPC: On a personal note, how are you coping with the lockdown?
Chandrashekhar: Well, I am working from home. I am writing articles, doing television interviews over the telephone or Skype, and responding to emails. Outside of work, I am spending time with my family. I am usually an outdoors person and I like to travel a lot in India and abroad, so this forced confinement is a change. I am learning to enjoy it, but I hope it is lifted on April 15th.
G. Chandrashekhar addresses the Pulse Conclave 2020, February 13, 2020.Chandrashekhar / India / covid19