The Political Economy of Food Subsidy in India

Indian parliament is getting ready to debate the National Food Security Bill that would be the single biggest poverty alleviation programme, costing about 1.5 per cent of India's gross domestic product. There has been a fierce debate leading up to the drafting of the bill and subsequent modifications. This article first points out the salient features of the Indian economy to give context to assess the current debate. In particular, it gives a detailed picture of the grain market in India and the important role played in it by the central government. It traces the path of the bill from its genesis through the subsequent debate and political process. The article identifies the key players in the debate and the role they have played in shaping the provisions in the latest draft of the bill. At the end, the authors speculate about likely food security outcomes in India

Product Proliferation in India's Cotton Seed Market: Are There Too Many Varieties?

With about $250 million in sales, India's cotton seed market is one of the largest cotton seed markets in the world. While products of public sector breeding traditionally dominated this sector, the bulk of value is now accounted by private seed firms. A persistent criticism of the Indian cotton seed market is that there are far too many cotton varieties as the private sector recycles older and inferior varieties under new names. This paper examines the phenomenon of variety proliferation in the cotton seed market of Maharashtra, India. Empirical evidence is presented from a survey of seed dealers in 2005. The evidence shows that while variety proliferation is indeed observed, the cause of it is private bred hybrids that are highly localized and which are rarely market leaders. Only a few varieties are dominant geographically and they command price premiums suggesting brand power. Firm and brand reputations matter and substitute for regulation by restricting fly-by-night operators.