Get Futures Price      
You are here : Home >> Report
Who to benefit from bio-fuel thrust?
Published on November 19, 2008 at 14:45
Buy/Sell Your Commodities
By Geena Paul
When food prices were going through the roof, part of the blame went the United States for diverting farmland used for cultivating wheat to fuel crops.

According to a World Bank study, as much as 75 per cent of the increase in food prices could be attributable to a change in the types of crops being farmed. So, the allegations were not quite wrong.

And, the US is not the only one to blame. Across the world, wheat, rice, potatoes and other food commodities are giving way to plants used in making green fuels. The Indian government is offering benefits for jatropha farming, while several countries in Africa are leasing out large tracts of farmland to Western companies for cultivating similar fuel crops when their people are facing famine.

In Canada, the government is making new efforts to boost the bio-fuel sector. The North American country has recently announced funding to increase bio-fuel use and finding out new seeds which can help increase bio-fuel production.

With conventional fuels still priced high and their reserves drying up the world over, the new-found thrust to bio-fuels may look quite logical. Especially, in a country like India, where more than two-thirds of the fuel it needs is imported, the importance given to bio-fuels is understandable. Then, there are the concerns on global warming, for which bio-fuels is a natural remedy. But, what will happen to the country’s food security if farmers leave wheat or rice cultivation in large scale and start focusing on jatropha? Or will there be any tangible benefit for the rural poor?

Of course the farmers may get better returns from fuel crops, at least in the initial stages. That should ideally improve their living standards. But, then count the corresponding, or even larger, increase in food prices due to food shortage. The net effect: there may not be any benefit for them.

The bulk of the fuel crop is intended to replace petrol, and most of the debates on alternative fuels are geared towards the motor transport industry. So, who is going to benefit? Is the government’s thrust on bio-fuels in the right direction? If Daimler launches a “green car” run on bio-fuels in India, it is not going to benefit the poor.

Misdirected thrust

In 2003, a National Bio-diesel Mission was launched, encouraging mixing of bio-fuels in petrol. The target is to mix 20 per cent bio-fuels to petrol by 2012. Several State governments have offered incentives to promote cultivation of plants used for bio-fuel production, particularly for companies.

In North-East India, tea estates are converted to grow bio-fuel plants like jatropha. This has happened in Mizoram, which faced a major food crisis in 2007. The government there has allowed a company, D1 Oils, to plant jatropha in 20,000 hectares instead of increasing the land used for food production.

It is not just in India where the thrust is misdirected. In some countries in Africa, the needs of local residents are not taken into account when the local governments shift land to Western companies to cultivate oil plants. For instance, in Ghana, BioFuel Africa wrested away land clearing and usage rights from a village chief who could neither read nor write, says a media report.

In fact, all over Africa, western companies are pushing to acquire large stretches of land to meet the world’s bio-fuel needs.

Sun Biofuels of the UK has already got 9,000 hectares from the Tanzanian government for a period of 99 years to for cultivating bio-fuel plants. In return, the company will build roads, schools and other infrastructure in the African country at an investment of $20 million.

Some other half a dozen companies from the Netherlands, the US, Sweden, Japan, Canada and Germany are also looking at similar projects in Tanzania. Namibia Malawi, Zambia, Ethiopia and Mozambique are among other countries the Western companies are eyeing.

It seems the rich wants the poor nations, where everything is cheap, to supply their bio-fuel demands. And, whether it is in India or Africa, the poor people, who make the least demand for energy, are going to be the ones who will suffer the most from this global craze for bio-fuels.

However, it is certainly not right to say bio-fuel crops have no place. But the way it is being promoted now will only increase disparities. Overuse of land for cultivating oil plants can create severe food shortages, a bigger threat for the mankind than the global warming that the green fuel can help mitigate.

 Print  |
 Email  |
  Discuss  |
The natural response of villagers in times of drought and floods is to leave their crops and cattle to flee to cities. But ICRISAT in association with a woman's self help group in Andhra Pradesh demonstrates how information technology and involvement of farmers can help predict such natural calamities and deal with them
Explore Commodity
Online
Read
Check Out
In Depth
Channels
Research
SMS Services
Others
About Us   |    Advertise   |    Contact Us   |    Feedback   |    Disclaimer   |    Terms & Conditions   |    Sitemap