India approves $20 billion cheap grain plan for poor

NEW DELHI - Reuters

The Indian government will sell subsidized wheat and rice to 67 percent of its population of 1.2 billion. REUTERS photo

India’s lower house of parliament has approved a plan worth nearly $20 billion to provide cheap grain to the poor, a key part of the ruling Congress party’s strategy to win re-election.

Under the plan approved on Aug. 26, the government will sell subsidized wheat and rice to 67 percent of its population of 1.2 billion. India is home to a quarter of the world’s hungry poor, according to United Nations data, despite being one of the biggest food producers and experiencing years of rapid economic growth.

The vote broke a long stalemate in parliament, potentially clearing the way for several reforms aimed at spurring the flagging economy which the government hopes to pass in an extended session that ends on September 6.

Faced with an unruly parliament, Prime Minister Manmohan Singh’s coalition government last month resorted to an executive order to implement the program, which his Congress party hopes will help win it a third consecutive term in power. The next election is due by May. 

The Rajya Sabha upper house must now approve the decree before it becomes law. 

In a foretaste of the battle for votes to come, the main opposition party says the welfare scheme, which expands an existing cheap food program covering 218 million people, is still too narrow to tackle widespread malnutrition among India’s millions of poor.

Lawmakers passed the bill only after nearly nine hours of debate and the inclusion of amendments that government sources could lead to an additional requirement of about 3 million tons of grain.

Singh said last year that the child malnutrition in India, where almost 50 percent of children are underweight, was a “national shame”.