Wednesday, December 18, 2013

How India sold out to the WTO

Suman Sahai

After Bali we should expect an influx of heavily subsidised agri produce from outside. This will knock the stuffing out of Indian farmers already reeling under adverse domestic policies.

The Indian media is presenting a glorious conclusion of the Bali ministerial, saying the Indian stand had prevailed and that India had indeed bent the US and EU to its will. This is the exact opposite of what has actually happened.

First, India was isolated, partly by the machinations of the developed countries but also because it chose to go it alone rather than with the bloc of developing countries who it has rightly infuriated with its succumbing to US pressure. India giving in will have negative implications for all of them. All the bravado we heard from commerce and industry minister Anand Sharma days before about standing firm to defend our food security vanished in Bali.

It’s remarkable that India failed to bring to centrestage the unfulfilled issues of the Doha Round and no attempt was made to link compliance with outstanding issues there with new issues raised at Bali.

India fell into the trap of discussing subsidy limits and de minimis support in agriculture when it should have argued on the basis of welfare and human rights. The Aggregate Measure of Support (AMS) calculated under the Agreement on Agriculture applies to producer subsidies, that is subsidies to farmers, which heaven knows the Food Security Act does not touch since, in a masterly move, the FSA does not deal with the producers of food at all.

Any subsidy component under discussion here would be a consumer subsidy, not a producer subsidy. It should have been argued as a welfare measure based on human rights imperatives.

India should have argued that its appalling figures of hunger and malnutrition amount to gross violation of the people’s right to food and any attempt by the government to act on it cannot possibly be placed under the purview of WTO sanctions. There was strong support for the India case from the UN Special Rapporteur on Right to Food which the Indian team failed to build on.

As it stands, India has failed to get its position accepted and it has accepted an interim agreement, a peace clause, but with conditions. And it has ceded trade facilitation. What has it come back with from Bali?

w Indian negotiators have placed the country’s entire stockholding of food under external scrutiny and have lost sovereign control over decision-making regarding buffer stocks. They have allowed the WTO’s Committee on Agriculture (CoA) to monitor our grain stocks.

w India will have to freeze its minimum support price (MSP) and will be unable to either raise the MSP or add new crops to its stocks after it has submitted the complicated and embarrassingly detailed forms on public stocks held by Central and state governments.
w Enormous paperwork and implementation costs have been added to maintaining our public stocks, money that could have been spent more profitably elsewhere.

w India will have to freeze the structure and modalities of food procurement now and will be unable to make changes without the permission of the CoA. This is not only humiliating, it has introduced the dangerous precedent of foreign interference in our food security strategies. India after Bali has lost the right to use public food reserves as a plank of its food security.

w Having made a pig’s breakfast of the Bali negotiations, India has also effectively sealed off for itself any avenues to support its farm sector, improve food production and secure the livelihoods of its small and marginal farmers, without invoking howls of protest from the CoA and the denizens of the WTO.

And Trade Facilitation stays in place as what we have given away at Bali. This will mean “facilitating” the entry of foreign products into the Indian market. Opening India’s market to agricultural produce has long been the goal of the large agriculture exporting countries, especially the US and EU. That goal is close to being realised. India has so far managed to fend off large-scale dumping of agricultural produce but that may be coming to an end.

After Bali we should expect an influx of heavily subsidised agri produce from outside. This will knock the stuffing out of Indian farmers already reeling under adverse domestic policies and the utter neglect of the agriculture sector. Trade facilitation for genetically modified products will almost certainly be on the menu, if for no other reason than to break the back of the domestic resistance to GM crops and foods. But also because the major agriculture exporters are sitting on stocks of GM corn and soya and there are other products in the pipeline, all waiting for markets.

And the Indian farmer post-Bali? Unable to compete with the heavily subsidised farm products from the US, Canada, Australia and the EU, the Indian farmer will be forced to abandon his fields and swell the slums of cities. Apart from the supply to the open market, who will produce the stocks of cereals needed to keep the Food Security Act in motion? I can almost see the Cargills and Bunges smiling in the wings.

The ill-conceived and opportunistic Food Security Act has cost the country very dear. Together with the inept negotiations in Bali, it has put India in the dock, under public scrutiny, tied its hands behind its back and taken away options for the betterment of the farm sector and future food security. The pale silver lining around this very black cloud is that there are four more years of negotiations before a final settlement on the issue of public stock holdings is reached. India must put together its best brains to develop aggressive negotiating positions well in advance, try to win back the support of the developing countries it has ditched and face the next rounds of WTO discussions with the goal of recovering what lost ground it can.

Source The Asian Age; 14 December  2013,

Tuesday, December 17, 2013

GENE CAMPAIGN Charter of Demands

 On the occasion of Gene Campaign’s 20th anniversary, a number of experts from across India , came together to brainstorm on the policy changes that were needed to make farming profitable and farmers prosperous. Given below is the Charter of Demands that was formulated by the experts after a daylong meeting.
*          *          *          *          *          *          *          *          *          *          *          *
1. The government must increase annual budgetary outlays for agriculture , by the Union and state governments ,  to 10 per cent of India's gross domestic product (against less than 1.5 per cent at present) for the next ten years. Of these outlays, between 60 per cent and 70 per cent should be reserved for rain-fed farming. systems.
2. Programs for food security must include nutrition security. Fortification of common staple foods with micro-nutrients should receive attention. A comprehensive program to establish homestead gardens should be promoted to boost household nutrition.
3. All programs providing food and nutrition support to children must be linked to their being registered in school and receiving regular health checkups.
4.Credit and insurance facilities should be provided to all those who cultivate land and keep livestock (not merely to land owners) by revamping the kisan credit card and making insurance more widespread.
5. Given the growing feminization of agriculture in India, there an urgent need to : enforce property rights of women and encourage joint ownership of productive assets, incentivize women’s access to credit cards (through an interest rate subvention of at least one per cent) , invest in agriculture equipment suitable for women.
 6. Restore and reorient agricultural extension services to promote high yielding, diversified and ecologically sustainable agriculture. This should be backed by research support and indigenous knowledge. 
7. To reduce financial burden on small farmers, establish and incentivize Smallholder Farmer Estates with common facilities and equipment, skill building in joint estate management,  bionutrition and IPM , water conservation and management, micro irrigation, fertigation ,  post-harvest value addition , packaging and collective marketing etc
8.  Government policies must strengthen and promote a broad genetic base for agriculture and encourage conservation of agro-bio-diversity, to build resilience in farming
9. Launch a comprehensive soil testing program across India to implement  location specific measures to restore and improve soil health.
10. Develop a policy and research framework for the development of agriculture in the mountainous regions of India.
11. Launch a water literacy campaign at policy and implementation levels that demand management is the main strategy for overcoming water scarcity.
Water management must be used as an entry point to improve livelihoods through productivity enhancement, value addition, and income generating activities through market-led diversification.
12. The public distribution system must be diversified and decentralized. Government policies should encourage procurement from about 50 km from the points of consumption and the PDS should include a range of locally produced foods.
13. Divert a part of fertilizer subsidies to public investments in agriculture leading to capital formation for strengthening alternative farming systems, especially climate resilient agriculture.
14. Encourage and incentivize states that reduce reliance on chemical inputs in agriculture and encourage bio-organic farming systems.
15. All government policies must be geared towards enabling the Indian farmer to become an entrepreneur. Only then can those who are in the riskiest profession in the world be empowered, making farming profitable and farmers prosperous.
*          *          *          *          *          *          *          *          *          *          *          *          *
Dated: Saturday 9 November, 2013
New Delhi