Doha and the political hazard

By S. Swaminathan

The count-down to the Fourth Ministerial Conference of the World Trade Organisation (WTO), naturally, has generated anxiety and tension, for the Vajpayee Government and no less for the Opposition parties, including the Congress, which are hoping to catch the government on the wrong foot. Currently as the Doha meet seems to be evolving, India does seem to have legitimate grounds for indignation for the rich countries continue to call the shots to the point where serious concerns over non- implementation of the Uruguay Round agreements, by the developed countries, are being treated as peripheral issues.

In their heightened zeal for expanding the WTO framework to bring in issues such as environment, competition policy, government procurement transactions, the rich countries do not see the damaging implications of their highhandedness for the credibility of the democratic process which is supposed to inform the WTO.

The belief that the stalemate in the WTO arose primarily because of the European Union refusing to budge on the intractable Common Agricultural Policy (CAP) - another name for unlimited mountainous subsidies for agriculturists in Europe - now appears to be overdrawn.

Even though agricultural tariffs threaten to divide the rich countries among themselves, in the WTO negotiations, there are grounds for believing that this time around in Doha, the script is most likely to be drawn up in aggressive pursuit by the developed countries, of the process of market opening in the developing countries, leaving only a large number of least developed countries.

The rationale that is being advertised, for the imperative for a new Round of trade negotiations is that the global campaign against terrorism, along with the unmistakable indications of an economic slowdown, warrant nothing less than an active demonstration by the WTO members of the belief in multilateralism in trade (with the unstated axiom that trade leaves no part of nationhood outside its reach).

Industry-agriculture divide

The discourse on WTO issues in India in recent times seems to have brought up an uncomfortable dichotomy between agriculture and industry. Critics of globalisation in India (among whom three former Prime Ministers Mr. Chandrasekhar, Mr. V. P. Singh and Mr. Deve Gowda appear to be taking to the streets), have had no qualms in identifying the WTO as the arch-villain responsible for untold miseries being heaped upon the Indian farming community.

The image of the WTO in India, even apart from all its technical and legal manifestations, is essentially that of a monster which has played havoc with the livelihoods of farmers whether in Punjab, Haryana, Andhra Pradesh, Karnataka or Kerala. Almost all the adverse developments in agriculture during the last six years, are impulsively ascribed to the removal of Quantitative Restrictions (QR) on imports, particularly of agricultural commodities.

Whether or not the statistical evidence of imports gives credence to this attribution of the woes of the farmers in India to the sinister consequences of the WTO, there is no question that the entire political establishment is against the WTO on this score. It would be suicidal for the Vajpayee Government to ignore this aspect of political antipathy to the WTO in the country. Surprisingly the fears about Indian agriculture being overwhelmed by the WTO regime, have not totally come from the agriculturists and their political mentors. Governments, both at the Centre and in the States, have come to believe that agriculture is fast becoming an economically unviable venture, even though it continues to provide livelihood for not less than 70 per cent of the population, besides ensuring food security for the people.

Many State governments are practically clueless as to why there is so much of social turbulence in the farm sector, with the vulnerable sections of the farming community sinking into irredeemable debt and seeking a desperate way out through suicides. Neither the Centre nor the States with all the talk about agricultural policy seem to have any clear policy priority in favour of agriculture.

All these must stand out in striking contrast to the policy of Farm Price Support whereby thousands of crores of rupees of tax revenue are pumped into the agricultural sector every year through subsidies to the relatively small section of large farm- owners who command substantial marketable surplus especially of rice and wheat.

Mr. Ajit Singh is a reformer after all!

The Union Agriculture Minister, Mr. Ajit Singh, a renowned leader of the Jat community in Uttar Pradesh, came into the Vajpayee Government with a clearly perceived image as a dauntless champion of the Kulakx, ever willing to question the wisdom of economic reforms, centering around the elimination of farm subsidies.

As it is turned out, Mr. Singh seems to have graduated into a pragmatic policy-maker, who recognises that Indian agriculture cannot be totally insulated from global competition.

But on the question of subsidies, Mr. Singh is clearly persuaded that the homilies of subsidies being preached by the rich countries are totally inconsistent with extraordinarily high levels of food subsidies both in the U.S. and in the EU.

Mr. Singh is hardly to be accused of partisanship when he complains that the public investment in agriculture, under the five year plans, has lagged far behind the requirements of a vibrant agricultural economy. He is again right in holding that there is a serious productivity gap in Indian agriculture apart from over-concentration on cereals.

If these basic problems are to be sorted out, there is no escape from looking at the rural sector in its entirety and not merely in terms of agriculture and irrigation. Unlike many of his counterparts in the States, Mr. Singh is not too scared by the prospect of genetically modified crops registering their visibility in Indian agriculture.

But Mr. Singh seems to have his own vague fears about the corporate sector playing a key role in the transformation of Indian agriculture from the means of livelihood for the poor into a globally competitive commercial occupation. He is more a votary of cooperatives in the agricultural sector, which is perhaps an unseverable legacy from the late Charan Singh!

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