Impact of Global Crisis on Food Commodities in India

Abstract

During the past few years, there was a significant increase in global food prices due to several structural and cyclical changes in many factors. The increase in food prices in India was much lower as compared to sharp increase in global prices due to various measures. Cereal prices in India Increased only 23 percent as compared to global price increase of 150 percent during 2009 to 2012. However, the food prices in the last two years have been higher than those in the period mid-1990s to 2004. Presently, the inflation for food articles (more than 10%) is higher than the general inflation (below 6%). The volatility in food prices is likely to continue and would harm the poor. Even before the food crisis, the poor and vulnerable were significantly left behind. Poor people spend 60 to 70 percent of their income on food and they have little capacity to adapt as prices rise and wages may not adjust accordingly. Thus, the situation in india can still pose a threat to food security of the country.