July 26, 2008: Press Release: Future of Indian Agriculture Being Sold Out at WTO
26 July 2008
Future of Indian Agriculture Being Sold Out at WTO
Recovering from a near political fall out earlier in the week over the US Nuclear deal, the Congress led UPA Government now stands on a fragile ground. Pressure is now on the UPA to accept a Doha Deal that will destroy the foundations of Indian agriculture – affecting livelihood concerns of 65 crore farmers and food security of the nation.
“It is now confirmed that US President George Bush has called up Prime Minister Manmohan Singh three times in the past couple of days to yield to US interests in completing the Doha Round. The Brazilian President, Luiz Inacio Lula da Silva, also called up the Prime Minister impressing upon him the urgency of sealing the Doha deal. Trade Minister Kamal Nath, who wanted to lead his delegation out of the talks, is reportedly being pressurized by the Prime Minister to accept the demands of USA and EU”, said Devinder Sharma of the New Delhi based Forum for Biotechnology & Food Security.
Both the Americans and the Europeans are demanding sharp tariff reductions in agriculture, a sector that is of crucial economic importance to India. The current draft deal presented by the WTO Director General Pascal Lamy on July 25th allows the US and the EU to continue their existing subsidy regimes and to make far less commitments than developing countries in agriculture.
“In light of the massive agriculture crisis facing this country, a move by this government to accept the Doha Deal will spell disaster for the agriculture sector on which two thirds of the population depends”, said Yudhvir Singh, Convener, Indian Coordination Committee of Farmers, an apex body of farm movements across the country.
Farm subsidies are the core of the problem and the developed countries are not only resisting moves to reduce them, but are also seeking provisions to double them in the future. “Trade distorting subsidies in the Green and Blue Boxes of these two trading blocks are going unchallenged at the current negotiations. This will ensure that dumping of subsidized agriculture commodities in developing countries will continue, said Chukki Nanjundaswamy”, leader of Karnataka Rajya Raitha Sangha.
Safety nets to developing countries’ farmers in the form of Special Products (SP) and Special Safeguards Mechanisms (SSM) have been diluted and made meaningless. Only 12 percent of tariff lines in agriculture can now be designated as Special Products of which 5 percent will be exempt from tariff cuts. The overall average tariff cut for SPs will now be 11 percent. This means that (a) India would be able to designate not more than 84 tariff lines in agriculture as SPs (b) of which only 4 will be exempt from tariff cuts (c) while the remaining 80 will undergo around 19 percent cuts. “Considering the fact that in order to address food and livelihoods security, and rural development concerns, India needs to designate around 57 percent of tariff lines as SPs with zero cuts, the present proposal is grossly inadequate”, added Bhaskar Goswami of the Forum for Biotechnology & Food Security, New Delhi.
India would now be allowed to invoke SSMs once imports exceed 40 percent by volume or prices go down by 15 percent. Irrespective of the volume of imports, the applicable import duty to protect domestic market cannot go beyond 15 percent of the bound tariffs. Further, even after invoking SSMs based on price triggers, the domestic price will continue to remain below what prevailed before prices began falling due to a surge in imports. SSM as an instrument of protection from import surges or price depressions has thus been rendered useless.
“The deal in its present for will ensure that developed countries do not have to reduce their subsidies by a single dollar. They will also getting away with not making effective cuts in tariffs. The USA will be allowed to re-designate the base period for subsidies which gives it the flexibility to reduce effective cuts. The Green Box, which is replete with trade distorting subsidies, will not be capped. Further, developed countries can designate 4 percent of their tariff lines as Sensitive Products whose tariffs can exceed 100 percent. Given the above, why are we even negotiating is a question that Prime Minister Manmohan Singh must answer”, asked Benny Kuruvilla of the Mumbai based Focus on the Global South.
“110 developing countries will reportedly gain around Rs. 30,000 crores from the Doha -deal while the 30 odd developed countries stand to make more than five times the amount. The government must stop hoodwinking Indian farmers over how this deal will benefit them. It is quite clear to us farmers that Mr. Chidambaram’s aim to push Indian farmers out of farming will be carried out through the faulty WTO framework”, said Kannaiyan Subramaniam of the Thamizhaga Vivasayigal Sangam, Tamil Nadu.
India would essentially sell off its agriculture sector if it signs the Doha Deal for little economic gain in return. This is unacceptable and the Trade Minister is warned that this will have enormous political repercussions on its fragile coalition government in the months to come. “If negotiators cannot protect the interest of Indian farmers, they must withdraw from the negotiations and come back to India,” said Devinder Sharma.
For further information, please contact Yudhvir Singh (+91-9868146405) or Bhaskar Goswami (+91-9811191335).
1. Indian Coordination Committee of Farmers
2. Bharatiya Kisan Union
3. Karnataka Rajya Raitha Sangha
4. Thamizhaga Vivasayigal Sangam, Tamil Nadu
5. Forum for Biotechnology & Food Security, New Delhi
6. Focus on the Global South - India
7. National Alliance of People’s Movements
8. National Forum of Forest People and Forest Workers
9. Kerala Independent Fish Workers Federation
10. National Agricultural Workers Forum
11. Andhra Pradesh Vyavasaya Viritidarulu Union
12. Andhra Pradesh Matchyukarala Union
13. Fifth Schedule Adivasi Sadana Council
14. Andhra Pradesh Vyachirekakorata Committee
For any more information, please contact:
Yudhvir Singh, Bharatiya Kisan Union-: +91-9868146405 (New Delhi)
Bhaskar Goswami, Forum for Biotechnology & Food Security, Delhi-: +91-9811191335
Afsar Jafri, Focus on the Global South, Mumbai-: +91-9833070803