The politics of Mega Food Parks – big announcements every week

On 5 April 2021, the government announced the setting up of a Mega Food Park in Motipur in Bihar at a cost of Rs. 400 crore. In the coming week of 12 April, it is expected that Baba Ramdev of Patanjali will finally initiate the construction of his Mega Food Park in Greater Noida in the Delhi NCR. This project has been cooking for over the past three years. Meanwhile, while campaigning in the West Bengal state assembly election, the country’s home minister promised to set up two Mega Food Parks if his party wins.

The idea of organizing the Indian food industry right from farm to fork has been the agenda of the past 70 years since independence. Its first 50 years saw the green revolution that brought new wheat varieties and grain self-sufficiency and the white revolution that made the country a major producer and exporter of rice. These years also give rise to the cooperative dairy movement that has made it the largest milk producer in the world. In 1992-93, the central government introduced the food park scheme whereby the states were to take up the responsibility for the food processing industrial estate projects.

In 2007-08, in a year of 8.5% GDP growth, the central government announced its more grandiose Mega Food Park (MFP) scheme. To encourage the private sector to build and operate the industrial estate infrastructure, these were meant to include warehouses and cold storage units, sorting, ripening, processing, and packaging plants leased to farmers, small and medium manufacturers, and logistics operators. Another stated intention of the MFPs was to come closer to farmers – to improve their productivity and influence their cropping patterns.

Food is the great football of the Indian economy, to be kicked between the central and state governments and between government subsidy and private enterprise. It is hostage to politicians who lose elections over food inflation and strong lobbies of farmers who now produce an excess of wheat that is not needed and rice that depletes the water table simply because there is a minimum support price. Experts say that it is likely that every ambition to alter and change the cropping pattern will meet with failure as long as subsidies disproportionately incentivize farmers to grow wheat and rice and thus not plant other crops needed to power better nutrition and exports.

Farmers in India are not directly taxed – they do not pay income tax. The laws were meant to protect the ownership of land to the tiller. In practice, the rules have led to the fragmentation of the holdings in poor farmers’ hands by their subdivision to successive generations. Simultaneously, subsidized water and electricity and minimum support prices for wheat and rice have enriched and consolidated farmers with good soil and irrigation.

Mega Food Parks – thus far an engine of incompetence

Most of the 42 (or 43 or 44) Mega Food Parks exist only on paper, and only four of the 16 (or 19) that have come up have reached or exceeded their aspirational level of 5,000 employees. Some are already embroiled in police and court cases for embezzlement and fraud.

The issues, cultural and economic, are complex. The abrupt style and mentality of the present central government are neither capable of understanding the economy’s complexity nor alleviating its integration with agriculture with its shock and awe approach. Just as its ban on cow slaughter and culling of herds is a considerable setback for the milk and food economy, its daily announcements of Mega Food Parks and selective largesse may not extend beyond photo opportunities.

The unscientific approach to agriculture and the economy is unlikely to enable the timely execution of the many sanctioned Mega Food Parks. The much-vaunted ‘Ease of Doing Business’ of this government is a laughing stock as many genuine entrepreneurs are already regretting their interest in the Mega Food Parks as they are kicked back and forth between state and central bureaucrats and compliances.