Terror as Usual in Peru

widening the gap between the open market prices and the PDS prices, which has resulted in some recovery in off-take from the PDS. As was set out in 1996 Economic Survey, the sharper increase in food prices, compared to the general rate of inflation, is very much part of NEP, and is aimed at reducing the protection given to manufacturing sector and improving the terms of trade of agriculture by liberalising agricultural trade, thus helping to increase agricultural output and exports. However what has happened is a deceleration in the rate of growth of agricultural output though there has been some increase in agricultural exports. Basically those who argue that simply getting the prices right, while cutting down on input subsidies and public investment, will boost agricultural output have got it all wrong and are clearly innocent of any understanding about the sources of growth in our agricultural sector. The thrust towards agri-exports during the NEP has mainly led to a reduction in the area under all cereals, coarse grains and pulses while increasing the area under oilseeds, as may be seen from Table 4.