Economic and Environmental Impact of National Food Security Act of India

The Government of India has enacted the National Food Security Act (NFSA) on September 12, 2013. The NFSA aims to provide subsidized food grains to approximately two thirds of India’s population. The legislation is a landmark, and perhaps the largest food security program in the world. The ambitious programme of the Government, besides offering several opportunities, throws many challenges in its implementation. In this background, the current paper evaluates the widespread impact of implementing NFSA on the Indian economy. The study applied a modified Leontief and Ghosh model under Input–output framework. The study also assessed the environmental impact of this act focusing on various environmental indicators. Further, the additional land requirement, labour generation and GDP growth that NFSA entails have also been computed. The impacts on sectoral prices have also been calculated. The result shows that the food grain sector has to grow by 3.75 % annually to match provision of food grains according to the norm set by the act. Apart from the targeted food grains sector, we noticed some indirect impact on other sectors such as Chemicals and Chemical Products, Mineral Fuels, Live stock products and Other Oilseeds and Crops. Overall the country needs to gear up in terms of food grain productivity, otherwise, NFSA must be supplemented by import, which would entail huge burden to country’s exchequer. On the other hand, the additional GDP and labour growth is expected to generate 1.51 % and 6.21 % respectively due to NFSA compared to 2016–17. But the impact on the environment is also not favourable. The economy is likely to generate additional GHG emissions of 10.39 million metric tonne of CO2 equivalent due to this act. A significant generation of water pollution is also expected. The overall land requirement on account of NFSA has been found to be sizeable whose availability remains as a big constraint. The study also throws some insight on the achievements of The Millennium Development Goals in the context of NFSA. In the context of Indian sub-continent, we find a perfect synergy between the basic objective of National Food Security Act and Millennium Development Goal. Overall, NFSA impact will enhance the growth of the economy. However, additional pressure on environment and land cannot be ignored. For sustainable food grains production in the economy, the nation should consider the improvement of agriculture productivity as well as to minimize the environmental effect by introducing more sustainable farming practice.