The high prices of essential items are creating unrest in many countries. This has become a grave concern for policy makers, economists and the media have been exercised over this as well. After realizing the implications of rising food inflation and its impact, the governments of different countries have resorted to all possible measures including trade, tariff and administrative. These would undoubtedly ease prices of food commodities temporarily but a long-term solution has to be found. There is a consensus that long-term global prices well be driven by a combination of demand and supply factors like the rate of expansion in food consumption, weather aberrations and climate change.

A new dimension has been added to the galloping food crisis which is green fuel, which has to come from soya bean, rapeseed, sugarcane, sorghum, oil palm or corn and jatropha. The use of bio-fuel has picked up in the last few years because of government support in industrialized countries. Blending is mandatory and there is financial support in the form of incentives granted to producers and consumers. Importantly, the US and other countries use their own domestic production for this purpose. After using food crops for this producing bio-fuel, their export surplus has declined and this has decreased supply of these items in the world, market.

In order to ensure that our bio-fuel policy does not conflict with our food needs, it is to be seen that there should be no subsidy whatsoever on any bio-fuel programme, including the pricing of power and water being used for irrigating sugarcane for ethanol. It is being pointed out that the diversion of food crops for bio-fuels by countries such as the US has resulted in food inflation and contributed greatly to world food crisis. The policies of these countries that support bio-fuels are being criticized.

Many experts in food policy consider that the diversion of crops into fuel production has contributed partly to higher prices of food crops with other factors including droughts and rapid global economic growth. Policy makers in countries like India have failed to pay adequate attention to agriculture growth and self-sufficiency in food. Agriculture has been ignored for too long and all of a sudden, we are talking about food insecurity, food riots, etc. There is an urgent need to rejuvenate agriculture and usher in reforms and investments so that productivity of food crops, which is stagnating for past two decades, may increase.

The world needs a policy for bio-fuels. The world must accept that the switching to bio-fuel will do little to avert climate change in the current circumstances. Instead, global climate policy must be to change consumption patterns to reduce emissions. Governments should not provide subsidies to grow crops for bio-fuel but spend to limit their fuel consumption by reducing the sheer number of vehicles on their roads. The policy must be to use non-edible bio-fuels on non-arable land only in high efficiency vehicles of mass transit-buses, not cars. If this is done, bio-fuels, which are renewable and emit less greenhouse gases, will make a difference.