Can Dr Singh do a Robert Peel?

T C A on Import:

• It will, instead, try to trap domestic supplies at home by banning exports. Indeed, this is why the UPA-I pumped in Rs 87,000 crore into farmers’ pockets last year through the increase in minimum support prices. It won the election as a result.
• But if the politicians continue to see it in this way, and do nothing about rising food prices, we could have food riots soon. The time has come to stop worrying only — note, only — about the producer and start worrying about the consumer also. About 70 per cent of net buyers of food are abjectly poor and live in the rural areas, so there is a moral dimension as well.
• The Government thinks food subsidies are an answer. In a limited way, they are. But the final answer lies in increasing supply now, and not waiting for productivity to increase at some distant date. And there is only one way to do this: Import.
• In a way, therefore, the Prime Minister has to do what a British Prime Minister, Robert Peel, did exactly 150 years ago — he repealed that infamous corn laws that had been enacted in 1815 to protect British corn prices against cheap imports from America.
• This import ban had caused millions to become poorer even as their incomes rose because of industrialisation.
• In the years after the repeal of the corn laws, that is between 1850 and 1900, food prices in Britain fell continuously, as did the land under corn. Import dependence went from only 2 per cent in 1830 to 75 per cent by the end of the century. That had other adverse consequences, mainly for India and China, but food in Britain became cheap.