India is suffering from a massive increase in Food Prices even as Millions of Tons of Grains are getting eaten by rats and termites.India’s Agriculture which is still heavily controlled by the government suffers from total misgovernnce and endemic corruption.The Food Corporation of India (FCI) which is the government body in charge of Procurement and Stocking of Foodgrains is known for being totally corrupt.In collusion with private traders,FCI officials openly sell subdized rice and wheat at much higher prices.Most of the Below the Poverty (BPL) families never get the subsides targeting them with the much heralded Food Programs leaking like a sieve.The Supreme Court in India recently reprimanded India’s Agricultural Minister for not distributing rotting food to the starving poor for free.Instead of improving the Distribution Mechanism,India’s PM told the Court not to interfere with the Executive Authority of the Indian Government.The whole supply chain for Agriculture is totally inefficient and fragmented.The entry of Retail MNCs had promised improvement in Agricultural Efficiency but the middlemen scuttled this move.So India’s Poor Consumers face Rising\u00a0 Food Prices even as India’s Farmer continue their suicides due to unremunerative income as middlemen siphon of the profits.<\/p>\n
A drastic dip in food inflation is unlikely. There are indications that fundamentals will support food prices for the next few months.<\/p>\n
Planning Commission Deputy Chairman Montek Singh Ahluwalia recently forecast that food price inflation would decline to six-seven per cent by December. On Thursday, he said this might not happen so soon. The wholesale food inflation rate for the week ended August 28 rose to 11.47 per cent from 10.86 per cent in the previous week.<\/p>\n