We often hear that every disaster provides an immense opportunity. Opportunity, for whom? It is invariably an opportunity for business. The more the sale of industrial products, more is the contribution to the economy, and therefore more is the GDP. What happens to human beings and the environment in the process is not any one's concern.
I wasn't therefore surprised to read a news report today: US gun lobby says firm 'no' to gun control (Indian Express, Dec 25, 2012. http://bit.ly/Y8sjIF). After all, how can the gun industry in the US be held responsible for the frequent children massacre being witnessed? Instead of curbing gun sales, shouldn't the US government appoint more policemen around schools and if need be around each home? Well, that's the way industrial lobbies work, and we shouldn't forget America is the land of lobbies.
In India, we are fast catching up. The continuing agrarian crisis, which has taken a heavy human toll with 290,470 deaths reported from suicides in past 15 years, provides a huge market for selling machines. Somehow the feeling is that more machines you sell, more sanity would prevail on the farm. Agriculture is being viewed as a machine-deficit sector, and more the machines sell more will be the reduction in farmer suicides. At least, this is what is visible from the way State Governments are aggressively promoting machines for the trouble-torn farming sector employing 57 per cent of the country's workforce.
Take Punjab, the country's food bowl. At a time when two farmers are committing suicide ever day, and indebtedness is growing with every passing year, 20,000 big tractors are being sold every year. These tractors are now of 90-105 horse power range, which is beyond any economic rationale. After all, in a State where the average land holding size is less than two hectares what is the need to promote such huge tractors (reminiscent of the Soviet Union era)? Moreover, every second farm household in Punjab already owns a tractor. Once the symbol of pride, tractor has already become a symbol of suicide. And still, the Punjab government is aggressively promoting tractors.
In neighbouring Haryana, more farm implements are being pushed. I agree there is a shortage of farm labour, but will the sales of all kinds of machines take out farmers from the crisis? Why can't the Haryana Farmers Commission instead urge the formation of cooperative societies which help in leasing farm implements to farmers? I suggest setting up farmer cooperative societies rather than setting up another State agency. But then, this will be opposed by the agribusiness industry just like the gun industry in US is opposed to any move to curb the gun sales.
The subsidy for land leveller has been increased from Rs 50,000 to Rs 75,000; on multiple crop planter from Rs 10,000 to Rs 20,000; on happy seeder from Rs 25,000 to Rs 50,000; on straw reaper from Rs 40,000 to Rs 60,000 and on zero till machine from Rs 15,000 to Rs 20,000. Haryana Chief Minister said yesterday that funds for modernisation of agriculture have also been raised from Rs 1-cr to Rs 3-cr. So if you have something to sell in the name of helping farmers, you too can make a lot of money. Rush to Punjab and Haryana (and the rest of the country too will gradually pick up from these two frontline farming States) and sell whatever you can in the name of helping farmers. Lobbying by the agribusiness industry has helped dole out subsidies making the machines cheaper to buy. What happens to farmers (and the destruction wrought on the natural resource base) in the process should not be your concern. After all, this is how business operates.
India: Direct cash transfers is aimed at dismantling food procurement, and moving away from food self-sufficiency.
Some weeks back, I was participating in a panel discussion on cash transfers on a national TV channel. While the discussion wheeled around the merits and demerits of cash transfer, I think the anchor was taken by surprise when I said that cash transfers is in effect a ‘cash-for-vote’ programme. Supporting my argument with a World Bank study for Latin America, I found the entire focus of the discussion thereafter shifting to whether the real intention behind the aggressive push for cash transfers is aimed at the 2014 elections.
While the media as well as most panellists who frequent the TV channels, for some strange reasons, were and are still reluctant to talk about the political ramifications of cash transfers, it was Rahul Gandhi who made it abundantly clear when he told his party men that cash transfer could win them not only 2014 but also the 2019 general elections. The entire academic euphoria over the proposed aggressive roll out of Aadhar-based (UID-lined) cash therefore is simply overbearing and needs to be seen in the light of political bias. In fact, the visible trend in the ongoing national debate is more towards being seen as politically correct.
A World Bank working paper, entitled: “Conditional Cash Transfers, Political Participation and Voting Behaviour,” studied the voting behaviour for a conditional cash transfer programme launched in Colombia just before the 2010 elections. Subsequently, a 2011 study of an unconditional cash transfer programme in Uruguay clearly established that cash transfers did help the ruling party get a large share of the votes, and thereby helped the party to romp home at the back of cash transfers. In India, the political urgency and the aggressiveness with which the massive cash transfers are expected to cover the entire country by April 2014 is therefore quite obviously aimed at bringing electoral benefit to the ruling party.
The unconditional direct cash transfer programme that is proposed to be launched from Jan 1 in three phases will start with 43 districts involving a cash provision of Rs 20,000-crore. Eventually, all forms of subsidies to the poor, including food and fertiliser, will be in the form of cash flow, and would add up to Rs 3 lakh crore annually. I fail to understand how and why such a massive cash outflow pipeline will reach the beneficiaries without first putting up a fool-proof delivery system in place. The Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) too was envisioned with a lot of expectations but has failed miserably to deliver. Several studies have pointed to nearly 70-80 per cent leakages, and yet somehow the impression is that MNREGA has transformed the rural economics.
With only 40 per cent of the population having access to banks, and with an over ambitious target of reaching the remaining population through banking correspondents – who will be operating like the village postmen except they will now be equipped with portable handheld machines acting like micro-ATMs – we are perhaps expecting too much from the most important human link between the technology and the money delivery. So far, there are only 70,000 banking correspondents and the experience has not been very encouraging. In the next one year, the number of banking correspondents will have to increase ten-fold to reach a staggering figure of 7 lakh.
Knowing that the entire rural and agricultural banking operations are rooted in corruption, I wonder how we have accepted that the banking correspondents will not be swayed by corrupt practices. If 60 per cent of the beneficiaries have to be reached through an army of banking correspondent, who will be handling over Rs 1.5 lakh crore by any conservative estimate, the delivery mechanism is certainly fraught with over-confidence stemming from political urgency. This is where I think the policy makers and bureaucrats have failed to rise above assumptions. This is where I think the aadhar-based cash-for-vote will end up being no different than the hype generated at the time of launching MNREGA.
Nevertheless, what worries me more is when cash transfers move to the next phase, and that means meeting food entitlements directly with cash. Thanks to the concerns raised by the civil society, the government has deferred cash-for-food for the time being. It was more because of the fear that the cash-for-food programme could go completely out of control, and therefore could negate the political advantage that the ruling party is hoping to garner, that it has been kept in abeyance. At a time when the proposed National Food Security bill is pending introduction before the 2014 elections, any tampering without a proper evaluation could backfire.
It is true that close to 60 per cent of the food that is channelized through the public distribution system is either wasted or siphoned off in transit, and that the entire system is mired in corruption. What reaches the poor beneficiaries is often not even fit for consumption. The answer however does not lie in dismantling the PDS system, but reforming the world-largest food delivery system to riddle it of corruption, and make it more effective. This is certainly possible, but given the extent of political meddling in the allotment of ration shops to transportation of grains, it has never been attempted in right earnest.
For several decades now, the international emphasis has been to force India to dismantle the PDS. The first attempt was made at the time of the infamous Dunkel draft during the primitive years of world trade negotiations. WTO aimed at curtailing the PDS role, and wanted markets to ensure food security. Strong opposition from India, cutting across political lines, forced the WTO to eventually withdraw that clause.Subsequently, in the name of decentralisation of food procurement and storage system, an attempt was made during the tenure of Atal Bihari Vajpayee to divest the Centre of its onerous responsibility of procuring foods for the central pool, and leave it to the States to manage grain procurement, storage and distribution.
Several chief ministers had opposed the decentralisation move thereby forcing the government to retreat.
For several years now, the emphasis has once again been on discarding food procurement. Allowing Food Corporation of India (FCI) to increasingly take on a commercial role by shifting focus from its sovereign role of ensuring domestic food security to looking for opportunities for grain exports, and finally to engage in future trading in wheat so as to offload and earn profits from the mounting surplus it carries. This has also to be seen in conjunction with the proposal to cap food procurement to the country’s buffer stock needs, and thereby deprive farmers of getting benefit of the assured price of wheat and rice. At present, FCI is under an obligation to purchase the surplus grains flowing in to the mandisat the Minimum Support Price. Once this role is withdrawn, farmers would be left at the mercy of trade.
Providing cash in the hands of poor beneficiaries means less emphasis on the PDS ration shops. The idea is to provide coupons or provide food entitlements in the form of cash, and leaving it to the people to buy their quota from the market. Whether the money provided would be used primarily to buy liquor, junk foods or other consumer goods is an important issue, but what is more important is to understand how it is aimed at dismantling the food procurement system. This subtle way, very cleverly designed, would undo the gains of food self-sufficiency so assiduously achieved after the advent of Green Revolution.
The underlying objective is very clear. Once the direct cash transfers begin, the ration shops would be gradually phased out. Once the PDS shops are removed, the cap in food procurement that is being suggested for FCI will come into play. With food procurement limited to meet the buffer requirements, which is somewhere between 14 to 22 million tonnes a year (against 82.3 million tonnes stocked with the FCI in June 2012), wheat and rice farmers would no longer get the benefit of the minimum support price. Farmers would be left to face the vagaries of the trade, and as has been the experience in those States which do not have a robust system of mandisand thereby unable to provide farmers with assured prices, distress sale will become a norm.
Withdrawal of food procurement system will have an impact on food production. This would help farmers to abandon farming, and migrate to the urban centres. This is exactly what the World Bank has been proposing for several years now. The 2008 World Development Report had called for land rentals and providing farmers with training opportunities so that they can be absorbed in the industry. The government, as directed, made budgetary provisions for setting up 1000 industrial training institutes across the country. It is therefore obvious that the government had wanted to withdraw from food procurement and distribution for quite long now, following the dictates of the World Bank/IMF. Cash-for-food will facilitate the process and make it easy. Food requirement will then have to be met from imports, and there is already a dominant thinking within the government which advocates importing subsidised food off-the-shelf from the western countries rather than spending more on growing food within the country.
FDI in retail comes at a time when contract farming is receiving greater attention. The idea is to link the farmers growing cash crops with the supermarkets. This will help the government from doing away with the system of announcing the minimum support price and thereby reduce the subsidy outgo. This is exactly what the World Trade Organisation (WTO) had wanted several decades ago. The process to dismantle food procurement, a highly emotive issue in India, actually began in mid 1990s. It is now receiving the final touches.
Prime Minister Manmohan Singh had repeatedly said that the country has 70 per cent more farmers than what is required. Cash-for-food will provide the smokescreen needed to accomplish what the WTO/World Bank/IMF have been telling India for long. It is only when of the farming population is moved out of the villages that the agribusiness can find a stronghold in India. The predominant economic thinking is that the population in agriculture has to be cut back drastically for any country to grow economically. Cash transfers will then be part of the bigger promise of igniting country’s economic growth. #
While the media as well as most panellists who frequent the TV channels, for some strange reasons, were and are still reluctant to talk about the political ramifications of cash transfers, it was Rahul Gandhi who made it abundantly clear when he told his party men that cash transfer could win them not only 2014 but also the 2019 general elections. The entire academic euphoria over the proposed aggressive roll out of Aadhar-based (UID-lined) cash therefore is simply overbearing and needs to be seen in the light of political bias. In fact, the visible trend in the ongoing national debate is more towards being seen as politically correct.
A World Bank working paper, entitled: “Conditional Cash Transfers, Political Participation and Voting Behaviour,” studied the voting behaviour for a conditional cash transfer programme launched in Colombia just before the 2010 elections. Subsequently, a 2011 study of an unconditional cash transfer programme in Uruguay clearly established that cash transfers did help the ruling party get a large share of the votes, and thereby helped the party to romp home at the back of cash transfers. In India, the political urgency and the aggressiveness with which the massive cash transfers are expected to cover the entire country by April 2014 is therefore quite obviously aimed at bringing electoral benefit to the ruling party.
The unconditional direct cash transfer programme that is proposed to be launched from Jan 1 in three phases will start with 43 districts involving a cash provision of Rs 20,000-crore. Eventually, all forms of subsidies to the poor, including food and fertiliser, will be in the form of cash flow, and would add up to Rs 3 lakh crore annually. I fail to understand how and why such a massive cash outflow pipeline will reach the beneficiaries without first putting up a fool-proof delivery system in place. The Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) too was envisioned with a lot of expectations but has failed miserably to deliver. Several studies have pointed to nearly 70-80 per cent leakages, and yet somehow the impression is that MNREGA has transformed the rural economics.
With only 40 per cent of the population having access to banks, and with an over ambitious target of reaching the remaining population through banking correspondents – who will be operating like the village postmen except they will now be equipped with portable handheld machines acting like micro-ATMs – we are perhaps expecting too much from the most important human link between the technology and the money delivery. So far, there are only 70,000 banking correspondents and the experience has not been very encouraging. In the next one year, the number of banking correspondents will have to increase ten-fold to reach a staggering figure of 7 lakh.
Knowing that the entire rural and agricultural banking operations are rooted in corruption, I wonder how we have accepted that the banking correspondents will not be swayed by corrupt practices. If 60 per cent of the beneficiaries have to be reached through an army of banking correspondent, who will be handling over Rs 1.5 lakh crore by any conservative estimate, the delivery mechanism is certainly fraught with over-confidence stemming from political urgency. This is where I think the policy makers and bureaucrats have failed to rise above assumptions. This is where I think the aadhar-based cash-for-vote will end up being no different than the hype generated at the time of launching MNREGA.
Nevertheless, what worries me more is when cash transfers move to the next phase, and that means meeting food entitlements directly with cash. Thanks to the concerns raised by the civil society, the government has deferred cash-for-food for the time being. It was more because of the fear that the cash-for-food programme could go completely out of control, and therefore could negate the political advantage that the ruling party is hoping to garner, that it has been kept in abeyance. At a time when the proposed National Food Security bill is pending introduction before the 2014 elections, any tampering without a proper evaluation could backfire.
It is true that close to 60 per cent of the food that is channelized through the public distribution system is either wasted or siphoned off in transit, and that the entire system is mired in corruption. What reaches the poor beneficiaries is often not even fit for consumption. The answer however does not lie in dismantling the PDS system, but reforming the world-largest food delivery system to riddle it of corruption, and make it more effective. This is certainly possible, but given the extent of political meddling in the allotment of ration shops to transportation of grains, it has never been attempted in right earnest.
For several decades now, the international emphasis has been to force India to dismantle the PDS. The first attempt was made at the time of the infamous Dunkel draft during the primitive years of world trade negotiations. WTO aimed at curtailing the PDS role, and wanted markets to ensure food security. Strong opposition from India, cutting across political lines, forced the WTO to eventually withdraw that clause.Subsequently, in the name of decentralisation of food procurement and storage system, an attempt was made during the tenure of Atal Bihari Vajpayee to divest the Centre of its onerous responsibility of procuring foods for the central pool, and leave it to the States to manage grain procurement, storage and distribution.
Several chief ministers had opposed the decentralisation move thereby forcing the government to retreat.
For several years now, the emphasis has once again been on discarding food procurement. Allowing Food Corporation of India (FCI) to increasingly take on a commercial role by shifting focus from its sovereign role of ensuring domestic food security to looking for opportunities for grain exports, and finally to engage in future trading in wheat so as to offload and earn profits from the mounting surplus it carries. This has also to be seen in conjunction with the proposal to cap food procurement to the country’s buffer stock needs, and thereby deprive farmers of getting benefit of the assured price of wheat and rice. At present, FCI is under an obligation to purchase the surplus grains flowing in to the mandisat the Minimum Support Price. Once this role is withdrawn, farmers would be left at the mercy of trade.
Providing cash in the hands of poor beneficiaries means less emphasis on the PDS ration shops. The idea is to provide coupons or provide food entitlements in the form of cash, and leaving it to the people to buy their quota from the market. Whether the money provided would be used primarily to buy liquor, junk foods or other consumer goods is an important issue, but what is more important is to understand how it is aimed at dismantling the food procurement system. This subtle way, very cleverly designed, would undo the gains of food self-sufficiency so assiduously achieved after the advent of Green Revolution.
The underlying objective is very clear. Once the direct cash transfers begin, the ration shops would be gradually phased out. Once the PDS shops are removed, the cap in food procurement that is being suggested for FCI will come into play. With food procurement limited to meet the buffer requirements, which is somewhere between 14 to 22 million tonnes a year (against 82.3 million tonnes stocked with the FCI in June 2012), wheat and rice farmers would no longer get the benefit of the minimum support price. Farmers would be left to face the vagaries of the trade, and as has been the experience in those States which do not have a robust system of mandisand thereby unable to provide farmers with assured prices, distress sale will become a norm.
Withdrawal of food procurement system will have an impact on food production. This would help farmers to abandon farming, and migrate to the urban centres. This is exactly what the World Bank has been proposing for several years now. The 2008 World Development Report had called for land rentals and providing farmers with training opportunities so that they can be absorbed in the industry. The government, as directed, made budgetary provisions for setting up 1000 industrial training institutes across the country. It is therefore obvious that the government had wanted to withdraw from food procurement and distribution for quite long now, following the dictates of the World Bank/IMF. Cash-for-food will facilitate the process and make it easy. Food requirement will then have to be met from imports, and there is already a dominant thinking within the government which advocates importing subsidised food off-the-shelf from the western countries rather than spending more on growing food within the country.
FDI in retail comes at a time when contract farming is receiving greater attention. The idea is to link the farmers growing cash crops with the supermarkets. This will help the government from doing away with the system of announcing the minimum support price and thereby reduce the subsidy outgo. This is exactly what the World Trade Organisation (WTO) had wanted several decades ago. The process to dismantle food procurement, a highly emotive issue in India, actually began in mid 1990s. It is now receiving the final touches.
Prime Minister Manmohan Singh had repeatedly said that the country has 70 per cent more farmers than what is required. Cash-for-food will provide the smokescreen needed to accomplish what the WTO/World Bank/IMF have been telling India for long. It is only when of the farming population is moved out of the villages that the agribusiness can find a stronghold in India. The predominant economic thinking is that the population in agriculture has to be cut back drastically for any country to grow economically. Cash transfers will then be part of the bigger promise of igniting country’s economic growth. #
What do you do when Heads of State indulge in lobbying ?
The chorus is getting louder. So what if Wal-Mart had spent Rs 125 crore ($25 million) in lobbying to gain access to the lucrative Indian retail market. After all, it's not one-off case, US firms have been doing it for long, says another news report (Hindustan Times, Dec 12, 2012. http://bit.ly/X9pbfg). Not only the print media, almost all TV discussions in India in the past few days have by and large carried the same line.
The demand is for legalising lobbying, following the pattern in the US, and thereby bringing in some regulations to make it more transparent. After all, the US has 12,220 lobbyists (consultants, lawyers, associations, corporations, NGOs etc) registered in 2011. There are over 15,000 lobbyists based in Brussels alone, who try to influence the European Union legislative process. In India, except for the industry lobbying groups -- Confederation of Indian Industry (CII), Federation of Indian Chambers of Commerce and Industry (FICCI) and the Associated Chambers of Commerce and Industry of India (Assocham India) -- not much is known about the other players in lobbying.
There are layers at which lobbying operates. Starts with academic institutes, and then goes to economists and scientists. They help with funded studies and reports that come in handy to convince the bureaucrats and politicians. Media then steps in raising the pitch. And finally, it is the politicians, political parties and ministers who remain the prime targets.
But what worries me more is when Heads of State start indulging in lobbying. If you have followed the news reports regularly, all Heads of State of major economic powers who visited India after 2009 had lobbied strongly in favour of FDI in retail. US President Barack Obama, UK Prime Minister David Cameron, Former French President Nicholos Sarkozy and German Chancellor Angela Merkel had impressed upon the Indian Prime Minister Manmohan Singh on the need to open up for big retail. US Secy of State Hilary Clinton, who had earlier served on the board of Wal-Mart, had even gone to the extent of lobbying with the West Bengal chief minister Mamata Banerjee when her party Trinamool Congress was part of the UPA-II Coalition in India.
Although the Indian government has agreed to institute an inquiry in to the specific case of Wal-Mart lobbying to know who was paid , if at all some payments were made, to influence the political decision making, the fact remains that the rut runs much deeper than what is visible. Take the case of Dow Chemicals, which later bought Union Carbide. According to a news report, Dow Chemicals had in 2011 spent $ 8 million (Rs 50-crore) to seek market access in Thailand, India and China. Well, this is is only one of the activities that companies often indulge in. Prior to lobbying activities in 2011, the US Securities and Exchange Commission had in 2007 fined Dow Chemicals $325,000 for bribing Indian officials to fast track permission to sell their pesticides brand that are banned in the US and many other countries (Dow bribed Indian officials with cash. jewellery and hospitality, Economic Times, June 28, 2010. http://bit.ly/RoiHwg).
India had instituted a Central Bureau of Investigation (CBI) inquiry into the bribery case. But did you hear anything after the case was filed? And knowing how the Union Carbide was for all practical purposes let off the hook for its role in Bhopal Gas disaster, big business would never be held accountable for its acts of omission and commission, forget about criminal culpability.
Monsanto, the global seed and technology giant, is known to be aggressively pursuing the introduction of controversial genetically-modified crops in the developing world. In 2005, the US Department of Justice had charged Monsanto with bribing Indonesian officials, and the company had agreed to pay a fine of US$ 1 million (Department of Justice, http://1.usa.gov/12764b3). Interestingly, the bribe amount of $50,000 to a senior Ministry of Environment official was shown as 'consultancy fee' in the company's books. In other words, it was shown as a lobbying fee. How does one therefore try to separate lobbying from bribery? No company has a separate head for bribery in its books and records. I don't know how can an inquiry separate the grains from chaff?
The GM industry has set up an NGO for lobbying purposes. The International Service for the Acquisition of Agri-biotech Applications (ISAAA) has an office in India, like many other developing countries. It lobbies with the scientific institutions as well as the politicians. There are instances of such lobby groups routinely taking journalists and government officials on visit to Monsanto's headquarters in America. This may be purely legitimate form of lobbying, but goes a long way in manipulating public opinion. Coming back to Wal-Mart, the New York Times had sometimes back had taken the lid off a massive scandal by Wal-Mart in Mexico -- where it allegedly paid bribes to seek expansion of its stores (Wal-Mart's US expansion plans complicated by bribery scandal. NYT April 29, 2012. http://nyti.ms/VBF5h8). In India too, an investigation has been launched into the violations of the foreign investment rules by Wal-Mart.
I don't therefore understand how can we believe that lobbying is completely a pious and legitimate activity unless we try to dig out how the companies bribe officials, and that includes economists, agricultural scientists and media owners, to get its way through. Lobbyists have known to be moving in the corridors of power, and more often than not carrying a bag of money. Ask any business and political journalist and they will tell you who's who of the corporates who have their lobbyists moving in the corridors of power. Not only Niira Radia, quote a large number of corporate lobbyists have been successful on the job, and seemingly operate silently without the public glare. Most decisions that you think have been taken in the national interest are actually swayed by money bags. Isn't that lobbying? Isn't lobbying therefore a cleaver phrase to provide a neat cover-up to everything bad associated with bribery?
It is a known secret that media remains one of the biggest beneficiary of lobbying. Not carrying a news report, which obviously benefits the corporate client, is one such unnoticed activity that media indulges in very frequently. Let me illustrate. At the height of the Wal-Mart debate in parliament, some media houses (who knew about it) had refused to carry a news report from Punjab which showed Wal-Mart paying a meager Rs8 to farmers growing baby corn. Wal-Mart sold it in wholesale for Rs 100/kg, making a neat Rs 92 in the process. This would have negated and exposed the government's claim that big retail would provide a better price to farmers by removing middlemen. Moreover, some of the major newspapers have never (or rarely) carried any critical view on FDI in retail. We know it why. Still more importantly, the way media appears more than keen to seek legitimacy for lobbying raises eyebrows.
Lobbying has over the years become more sophisticated. It is not only a particular bureaucrat or a government official who gets an all-paid foreign trip or jewellery or other expensive gifts (like the way doctors are bribed by pharmaceutical companies as part of the lobbying activities to promote their brand of drugs), lobbying is now becoming a diplomatic activity. Several times we know how the US Ambassador in India (backed by the USIS and USAID) for instance had lobbied hard to push American commercial interests, including the nuclear treaty. EU diplomatic missions regularly hobnob with Indian officials lobbying on behalf of their respective businesses. Sometimes back, Wikileaks had exposed the use of diplomatic channels for lobbying across the world. Diplomatic lobbying also comes with arm-twisting, if required. Many such instances were exposed in Wikileaks.
Also see: The world of lobbyists. Deccan Herald.
http://www.deccanherald.com/
The demand is for legalising lobbying, following the pattern in the US, and thereby bringing in some regulations to make it more transparent. After all, the US has 12,220 lobbyists (consultants, lawyers, associations, corporations, NGOs etc) registered in 2011. There are over 15,000 lobbyists based in Brussels alone, who try to influence the European Union legislative process. In India, except for the industry lobbying groups -- Confederation of Indian Industry (CII), Federation of Indian Chambers of Commerce and Industry (FICCI) and the Associated Chambers of Commerce and Industry of India (Assocham India) -- not much is known about the other players in lobbying.
There are layers at which lobbying operates. Starts with academic institutes, and then goes to economists and scientists. They help with funded studies and reports that come in handy to convince the bureaucrats and politicians. Media then steps in raising the pitch. And finally, it is the politicians, political parties and ministers who remain the prime targets.
But what worries me more is when Heads of State start indulging in lobbying. If you have followed the news reports regularly, all Heads of State of major economic powers who visited India after 2009 had lobbied strongly in favour of FDI in retail. US President Barack Obama, UK Prime Minister David Cameron, Former French President Nicholos Sarkozy and German Chancellor Angela Merkel had impressed upon the Indian Prime Minister Manmohan Singh on the need to open up for big retail. US Secy of State Hilary Clinton, who had earlier served on the board of Wal-Mart, had even gone to the extent of lobbying with the West Bengal chief minister Mamata Banerjee when her party Trinamool Congress was part of the UPA-II Coalition in India.
Although the Indian government has agreed to institute an inquiry in to the specific case of Wal-Mart lobbying to know who was paid , if at all some payments were made, to influence the political decision making, the fact remains that the rut runs much deeper than what is visible. Take the case of Dow Chemicals, which later bought Union Carbide. According to a news report, Dow Chemicals had in 2011 spent $ 8 million (Rs 50-crore) to seek market access in Thailand, India and China. Well, this is is only one of the activities that companies often indulge in. Prior to lobbying activities in 2011, the US Securities and Exchange Commission had in 2007 fined Dow Chemicals $325,000 for bribing Indian officials to fast track permission to sell their pesticides brand that are banned in the US and many other countries (Dow bribed Indian officials with cash. jewellery and hospitality, Economic Times, June 28, 2010. http://bit.ly/RoiHwg).
India had instituted a Central Bureau of Investigation (CBI) inquiry into the bribery case. But did you hear anything after the case was filed? And knowing how the Union Carbide was for all practical purposes let off the hook for its role in Bhopal Gas disaster, big business would never be held accountable for its acts of omission and commission, forget about criminal culpability.
Monsanto, the global seed and technology giant, is known to be aggressively pursuing the introduction of controversial genetically-modified crops in the developing world. In 2005, the US Department of Justice had charged Monsanto with bribing Indonesian officials, and the company had agreed to pay a fine of US$ 1 million (Department of Justice, http://1.usa.gov/12764b3). Interestingly, the bribe amount of $50,000 to a senior Ministry of Environment official was shown as 'consultancy fee' in the company's books. In other words, it was shown as a lobbying fee. How does one therefore try to separate lobbying from bribery? No company has a separate head for bribery in its books and records. I don't know how can an inquiry separate the grains from chaff?
The GM industry has set up an NGO for lobbying purposes. The International Service for the Acquisition of Agri-biotech Applications (ISAAA) has an office in India, like many other developing countries. It lobbies with the scientific institutions as well as the politicians. There are instances of such lobby groups routinely taking journalists and government officials on visit to Monsanto's headquarters in America. This may be purely legitimate form of lobbying, but goes a long way in manipulating public opinion. Coming back to Wal-Mart, the New York Times had sometimes back had taken the lid off a massive scandal by Wal-Mart in Mexico -- where it allegedly paid bribes to seek expansion of its stores (Wal-Mart's US expansion plans complicated by bribery scandal. NYT April 29, 2012. http://nyti.ms/VBF5h8). In India too, an investigation has been launched into the violations of the foreign investment rules by Wal-Mart.
I don't therefore understand how can we believe that lobbying is completely a pious and legitimate activity unless we try to dig out how the companies bribe officials, and that includes economists, agricultural scientists and media owners, to get its way through. Lobbyists have known to be moving in the corridors of power, and more often than not carrying a bag of money. Ask any business and political journalist and they will tell you who's who of the corporates who have their lobbyists moving in the corridors of power. Not only Niira Radia, quote a large number of corporate lobbyists have been successful on the job, and seemingly operate silently without the public glare. Most decisions that you think have been taken in the national interest are actually swayed by money bags. Isn't that lobbying? Isn't lobbying therefore a cleaver phrase to provide a neat cover-up to everything bad associated with bribery?
It is a known secret that media remains one of the biggest beneficiary of lobbying. Not carrying a news report, which obviously benefits the corporate client, is one such unnoticed activity that media indulges in very frequently. Let me illustrate. At the height of the Wal-Mart debate in parliament, some media houses (who knew about it) had refused to carry a news report from Punjab which showed Wal-Mart paying a meager Rs8 to farmers growing baby corn. Wal-Mart sold it in wholesale for Rs 100/kg, making a neat Rs 92 in the process. This would have negated and exposed the government's claim that big retail would provide a better price to farmers by removing middlemen. Moreover, some of the major newspapers have never (or rarely) carried any critical view on FDI in retail. We know it why. Still more importantly, the way media appears more than keen to seek legitimacy for lobbying raises eyebrows.
Lobbying has over the years become more sophisticated. It is not only a particular bureaucrat or a government official who gets an all-paid foreign trip or jewellery or other expensive gifts (like the way doctors are bribed by pharmaceutical companies as part of the lobbying activities to promote their brand of drugs), lobbying is now becoming a diplomatic activity. Several times we know how the US Ambassador in India (backed by the USIS and USAID) for instance had lobbied hard to push American commercial interests, including the nuclear treaty. EU diplomatic missions regularly hobnob with Indian officials lobbying on behalf of their respective businesses. Sometimes back, Wikileaks had exposed the use of diplomatic channels for lobbying across the world. Diplomatic lobbying also comes with arm-twisting, if required. Many such instances were exposed in Wikileaks.
Also see: The world of lobbyists. Deccan Herald.
http://www.deccanherald.com/
As in the West, Indian farmers too need direct income support
Chatting with Ashok Kumar from One World South Asia, Policy Analyst Devinder Sharma explained how flawed policies goad Indian farmers to suicide.
Action Aid organised a national consultation in New Delhi and public hearing on the issue of framers' suicides. The farmers’ consultation brought together experts and policy analysts to evaluate the progress of government initiatives to respond to the ongoing agrarian crisis.
Chatting with Ashok Kumar from One World South Asia, Policy Analyst Devinder Sharma explained how flawed policies goad Indian farmers to suicide. Excerpts from the interview:
OneWorld South Asia: What do you have to say on the status of Indian farmers in the country?
Devinder Sharma: India is witnessing the worst agrarian crisis all across the globe. It is a crisis because in the last 15 years more than 2, 95,000 farmers have committed suicides. But these are the farmers who had the ‘courage’ to die. But there are others who are also living in the same state but they do not have the courage to die. It certainly does not mean that the latter are doing well.
OWSA: What do you think is the root cause of such a condition of the farmers?
Sharma: Over the years, the policies have been so designed that agriculture has become unviable and uneconomical in India. The problem is because of the economic policy followed over the years which is pitted against the farmers. So, the effort is to move people out of agriculture to the urban areas. Unfortunately, the mainline economists think that if you want to have economic growth, the way we measure our GDP, then it can be done by following those countries which have reduced their population engaged in agriculture. So, the entire thinking is unless we remove these people out of agriculture there will not be economic growth in this country.
OWSA: Where do you think have we gone wrong, precisely?
Sharma: The basic thrust is to make farming unviable and the force the farmers out to urban areas, which is a very flawed policy in pursuit of economic growth and is actually a path to disaster. What has happened in Europe or America cannot be followed in India. In a country which has 60 per cent of its population involved in agriculture the kind of paradigms which worked in the West cannot be implemented here.
OWSA: How could we resolve this situation which seems to be going out of hand?
Sharma: Mahatama Gandhi had said that a country like India needs production by the masses and not for the masses. Farming has to be made viable. According to Gandhi, we should strive for economic growth by making farming profitable. Time has come when the government should set up a separate farmers’ income commission which decides the per-family or per acre family of the farmers with the help of several other inputs like the variety of soil, water availability and other factors. It is shocking to learn that a farmer earns around Rs 2000 to Rs 3000 in a month while the monthly salary of a lowest government employee is Rs 15,000. Government should strive to do away with this gap and ensure that the minimum income of a farmer at least matches that of the lowest government employee. We need to provide an assured minimum income of Rs 15,000 per month to the farmer. And, then we can see a shift taking place to sustainable agriculture.
OWSA: How farming in this country can be made viable?
Sharma: We have tried many formulae to improve the viability of farming. We are also trying to implement Foreign Direct Investment (FDI) in retail which has earlier not worked in Europe or America. But, I think we should go for sustainable farming. We have to bring in our country, what has been done in the West. Farming in these countries is viable because farmers are provided with direct income support. India also follows the same agricultural model (Application of fertilizers and machines) followed in the West with the difference being only of scale (of land holdings). Therefore, we also need to provide the same kind of support to farmers provided in those countries. Our farmers our dying because we do not give them direct income support.
Source: One World South Asia, Nov 30, 2012
URL: http://southasia.oneworld.net/
Chatting with Ashok Kumar from One World South Asia, Policy Analyst Devinder Sharma explained how flawed policies goad Indian farmers to suicide. Excerpts from the interview:
OneWorld South Asia: What do you have to say on the status of Indian farmers in the country?
Devinder Sharma: India is witnessing the worst agrarian crisis all across the globe. It is a crisis because in the last 15 years more than 2, 95,000 farmers have committed suicides. But these are the farmers who had the ‘courage’ to die. But there are others who are also living in the same state but they do not have the courage to die. It certainly does not mean that the latter are doing well.
OWSA: What do you think is the root cause of such a condition of the farmers?
Sharma: Over the years, the policies have been so designed that agriculture has become unviable and uneconomical in India. The problem is because of the economic policy followed over the years which is pitted against the farmers. So, the effort is to move people out of agriculture to the urban areas. Unfortunately, the mainline economists think that if you want to have economic growth, the way we measure our GDP, then it can be done by following those countries which have reduced their population engaged in agriculture. So, the entire thinking is unless we remove these people out of agriculture there will not be economic growth in this country.
OWSA: Where do you think have we gone wrong, precisely?
Sharma: The basic thrust is to make farming unviable and the force the farmers out to urban areas, which is a very flawed policy in pursuit of economic growth and is actually a path to disaster. What has happened in Europe or America cannot be followed in India. In a country which has 60 per cent of its population involved in agriculture the kind of paradigms which worked in the West cannot be implemented here.
OWSA: How could we resolve this situation which seems to be going out of hand?
Sharma: Mahatama Gandhi had said that a country like India needs production by the masses and not for the masses. Farming has to be made viable. According to Gandhi, we should strive for economic growth by making farming profitable. Time has come when the government should set up a separate farmers’ income commission which decides the per-family or per acre family of the farmers with the help of several other inputs like the variety of soil, water availability and other factors. It is shocking to learn that a farmer earns around Rs 2000 to Rs 3000 in a month while the monthly salary of a lowest government employee is Rs 15,000. Government should strive to do away with this gap and ensure that the minimum income of a farmer at least matches that of the lowest government employee. We need to provide an assured minimum income of Rs 15,000 per month to the farmer. And, then we can see a shift taking place to sustainable agriculture.
OWSA: How farming in this country can be made viable?
Sharma: We have tried many formulae to improve the viability of farming. We are also trying to implement Foreign Direct Investment (FDI) in retail which has earlier not worked in Europe or America. But, I think we should go for sustainable farming. We have to bring in our country, what has been done in the West. Farming in these countries is viable because farmers are provided with direct income support. India also follows the same agricultural model (Application of fertilizers and machines) followed in the West with the difference being only of scale (of land holdings). Therefore, we also need to provide the same kind of support to farmers provided in those countries. Our farmers our dying because we do not give them direct income support.
Source: One World South Asia, Nov 30, 2012
URL: http://southasia.oneworld.net/
किसानों की बर्बादी की योजना
इससे अधिक नुकसानदेह और कुछ नहीं हो सकता। चीनी से नियंत्रण हटाने की योजना है। इससे गन्ना उगाने वाले किसान शुगर मिलों की दया पर निर्भर हो जाएंगे। रंगराजन कमेटी द्वारा गन्ने के स्टेट एडवाइस्ड प्राइस (एसएपी) को खत्म करने के सुझाव के बाद अब किसानों को फेयर एंड रेमुनेरेटिव प्राइस (एफआरपी) पर निर्भर रहना होगा। एफआरपी का निर्धारण केंद्र सरकार करती है और यह राज्य सरकारों द्वारा तय किए जाने वाले मूल्य से काफी कम होता है। एक प्रकार से यह कदम गन्ने की पैदावार और चीनी के उत्पादन को बाजार के नियंत्रण में लाने के उद्देश्य से उठाया गया है। यही नीति अब गेहूं और धान पर भी लागू की जा रही है। पांच सालों में पहली बार इस साल गेहूं के न्यूनतम समर्थन मूल्य में कोई बढ़ोतरी न करने के बाद सरकार इस बात पर विचार कर रही है कि क्या गेहूं के दाम बढ़ाने की आवश्यकता है और क्या गेहूं की खरीद को बाजार की अर्थव्यवस्था से जोड़ देना चाहिए। गेहूं के दाम न बढ़ाकर सरकार संभवत: गेहूं से ध्यान हटाकर नकदी फसल पर केंद्रित करना चाहती है।
इस फैसले का असर किसानों के साथ-साथ करोड़ों भूखे लोगों पर भी पड़ेगा। न्यूनतम मूल्य हरित क्रांति की विशिष्टता थी, जिसने खाद्यान्न उत्पादन में वृद्धि में बड़ी भूमिका निभाई। मूल खाद्यान्न से न्यूनतम समर्थन मूल्य वापस ले लेने का मतलब होगा-खाद्यान्न के निर्यात में इजाफा। यह चरणबद्ध तरीके से हो रहा है। एक ऐसे समय जब वैश्विक भूख सूचकांक 2012 में 79 देशों की सूची में भारत 65वें स्थान पर है, खाद्यान्न एवं सार्वजनिक वितरण राज्य मंत्री केवी थॉमस फरमा रहे हैं कि भारतीय खाद्य निगम अब जल्द ही सट्टा बाजार में गेहूं का व्यापार करेगा। फॉर्वर्ड मार्केट कमीशन से जरूरी अनुमति की मांग करते हुए मंत्री ने कहा कि बाजार को मूल्य जोखिम प्रबंधन में आर्थिक आधार पर काम करना चाहिए। इससे यह मतलब निकलता है कि वह खुला बाजार बिक्री योजना के स्थान पर सट्टा बाजार में व्यापार करना चाहते हैं। दूसरे शब्दों में, सट्टा बाजार भारतीय खाद्य निगम के सामने कुछ लाभ कमाने का अवसर पेश करेगा, जिसको वापस खाद्यान्न खरीद में लगा दिया जाएगा। इस प्रकार सरकार को खाद्यान्न सब्सिडी में कटौती का मौका मिल जाएगा। यह है सरकार की योजना।
यह इतना आसान नहीं है जितना नजर आता है। खाद्यान्न की सरकारी खरीद के साथ-साथ एफसीआइ की एक भूमिका खाद्यान्न की महंगाई पर अंकुश लगाना भी है। जब भी घरेलू बाजार में गेहूं और धान की कीमतें बढ़ती हैं एफसीआइ खुले बाजार में खाद्यान्न बेचकर कीमतों को नीचे लाता है। संयुक्त राष्ट्र के खाद्यान्न एवं कृषि संगठन (एफएओ) के अनुसार जून 2011 से जुलाई 2012 तक एक वर्ष में भारत में गेहूं के दामों में सूडान के बाद विश्व में सबसे अधिक बढ़ोतरी दर्ज की गई। धान के संदर्भ में विश्व में भारत तीसरे स्थान पर रहा और वह भी तब जब भारत के भंडारण गृहों में भारी मात्रा में अतिरिक्त खाद्यान्न उपलब्ध था।
बाजार मूल्य पर दबाव कम करने के लिए जुलाई-अगस्त में थोक उपभोक्ताओं तथा छोटे निजी व्यापारियों के लिए एफसीआइ ने 26.02 लाख टन गेहूं की टेंडर के आधार पर बिक्री की थी। इससे घरेलू बाजार में गेहूं के दामों को कम करने में मदद मिली। दामों को कम करने में एफसीआइ की इस नाजुक भूमिका में बदलाव के सरकार के फैसले में मुझे कोई औचित्य नजर नहीं आता। सरकार की नई योजना से एफसीआइ खाद्यान्न के दाम घटाने के बजाय बढ़ाने में प्रमुख भूमिका निभाएगी। सट्टेबाजी में उतरने के बाद पहले से ही ऊंचे रेट फिक्स करके एफसीआइ महंगाई बढ़ाने के सबसे बड़े खिलाड़ी के रूप में उभरेगा। यह खाद्यान्न की भारी मात्रा के बल पर बाजार का रुख मोड़ सकने की ताकत रखता है।
इसका सीधा असर खाद्यान्न के दामों में तीव्र वृद्धि के रूप में देखने को मिलेगा। अंतरराष्ट्रीय बाजारों पर एक नजर डालकर देखा जाए कि इनमें हमारे लिए क्या सीख हो सकती है। 2007 में जब वैश्विक खाद्यान्न संकट चरम पर था और 37 देशों में खाद्यान्न को लेकर दंगे भड़क रहे थे, संयुक्त राष्ट्र की विशेष रिपोर्ट में कहा गया था कि खाद्यान्न के दाम बढ़ने के पीछे सबसे बड़ा हाथ सट्टेबाजी का था। खाद्यान्न की कीमतें मांग और आपूर्ति से तय नहीं हो रही थीं, बल्कि वित्तीय अटकलें और सट्टेबाजी में निवेश इनकी बढ़ोतरी के कारक थे। मानवीय पीड़ा और भूखे पेट की कीमत पर कुछ कृषिव्यापार क्षेत्र की बड़ी कंपनियों ने मोटा मुनाफा कमाया।
2012 के उत्तरार्ध में एक बार फिर वैश्विक खाद्यान्न की कीमतों में जबरदस्त उछाल देखने को मिल रहा है। अमेरिका में सूखे की आशंका और रूस व उक्रेन में खाद्यान्न उत्पादन में कमी से खाद्यान्न में व्यापार करने वाली विश्व की सबसे बड़ी कंपनी कारगिल मालामाल हो गई। एक अन्य बड़ी कंपनी ग्लेनकोर भी इसी राह पर चल रही है।
एफसीआइ को व्यापारिक इकाई में बदलने में गंभीर खतरे निहित हैं। भारत जैसे विशाल देश में, जिस पर विश्व में सबसे अधिक भूखी आबादी का दाग लगा है, एफसीआइ मुख्यत: दो भूमिकाएं निभाता है। पहली भूमिका यह है कि यह किसानों से पहले से तय की गई कीमतों पर खाद्यान्न की खरीदारी करता है। भारतीय किसानों के लिए सरकारी उसकी फसल का लाभकारी मूल्य दिलाती है। यद्यपि हर साल 22 फसलों का खरीद मूल्य घोषित किया जाता है, एफसीआइ केवल गेहूं और धान की खरीद ही करता है। गेहूं और धान का उत्पादन बढ़ने का यही प्रमुख कारण है। सरकारी खरीद बंद करने और एफसीआइ के बाजार में दखल देने की नई भूमिका से भारत में कृषि बर्बाद हो जाएगी। देश के जिन भागों में एफसीआइ सक्रिय नहीं है, वहां किसान बहुत कम कीमत पर गेहूं और धान बाजार में बेचने को मजबूर हैं। इस प्रकार एफसीआइ तो पहले से ही मूल्य जोखिम प्रबंधन की जिम्मेदारी निभा रहा है। अमेरिका के अनुभव से स्पष्ट हो जाता है कि इन आर्थिक जिम्मेदारियों को निभाने की सट्टा बाजार से की जा रही अपेक्षाएं महज खयाली पुलाव हैं।
अमेरिका के शिकागो में विश्व का सबसे बड़ा कमोडिटी एक्सचेंज है, इसके बावजूद अमेरिका में सट्टेबाजी से किसानों का कोई भला नहीं हुआ। कृषि को लाभकारी बनाने में सट्टेबाजी की विफलता के कारण ही अमेरिका किसानों को भारी भरकम सब्सिडी प्रदान करता है। फूड बिल 2008 में पांच साल के लिए 307 अरब डॉलर (करीब 16 लाख करोड़ रुपये) की सब्सिडी का प्रावधान किया गया था। इसमें संदेह नहीं कि एफसीआइ में भ्रष्टाचार व्याप्त है, किंतु इसे खत्म कर देना एक बड़े विनाश की ओर ले जाएगा। इससे भारत फिर से खाद्यान्न आयातक देश बन जाएगा और खाद्य सुरक्षा खतरे में पड़ जाएगी। जाहिर है, इससे भुखमरी तो बढ़ेगी ही।
[लेखक देविंदर शर्मा, कृषि मामलों के विशेषज्ञ हैं]
Source: Dainik Jagran, Nov 23, 2012.
http://in.jagran.yahoo.com/news/opinion/general/6_3_9873871.h
इस फैसले का असर किसानों के साथ-साथ करोड़ों भूखे लोगों पर भी पड़ेगा। न्यूनतम मूल्य हरित क्रांति की विशिष्टता थी, जिसने खाद्यान्न उत्पादन में वृद्धि में बड़ी भूमिका निभाई। मूल खाद्यान्न से न्यूनतम समर्थन मूल्य वापस ले लेने का मतलब होगा-खाद्यान्न के निर्यात में इजाफा। यह चरणबद्ध तरीके से हो रहा है। एक ऐसे समय जब वैश्विक भूख सूचकांक 2012 में 79 देशों की सूची में भारत 65वें स्थान पर है, खाद्यान्न एवं सार्वजनिक वितरण राज्य मंत्री केवी थॉमस फरमा रहे हैं कि भारतीय खाद्य निगम अब जल्द ही सट्टा बाजार में गेहूं का व्यापार करेगा। फॉर्वर्ड मार्केट कमीशन से जरूरी अनुमति की मांग करते हुए मंत्री ने कहा कि बाजार को मूल्य जोखिम प्रबंधन में आर्थिक आधार पर काम करना चाहिए। इससे यह मतलब निकलता है कि वह खुला बाजार बिक्री योजना के स्थान पर सट्टा बाजार में व्यापार करना चाहते हैं। दूसरे शब्दों में, सट्टा बाजार भारतीय खाद्य निगम के सामने कुछ लाभ कमाने का अवसर पेश करेगा, जिसको वापस खाद्यान्न खरीद में लगा दिया जाएगा। इस प्रकार सरकार को खाद्यान्न सब्सिडी में कटौती का मौका मिल जाएगा। यह है सरकार की योजना।
यह इतना आसान नहीं है जितना नजर आता है। खाद्यान्न की सरकारी खरीद के साथ-साथ एफसीआइ की एक भूमिका खाद्यान्न की महंगाई पर अंकुश लगाना भी है। जब भी घरेलू बाजार में गेहूं और धान की कीमतें बढ़ती हैं एफसीआइ खुले बाजार में खाद्यान्न बेचकर कीमतों को नीचे लाता है। संयुक्त राष्ट्र के खाद्यान्न एवं कृषि संगठन (एफएओ) के अनुसार जून 2011 से जुलाई 2012 तक एक वर्ष में भारत में गेहूं के दामों में सूडान के बाद विश्व में सबसे अधिक बढ़ोतरी दर्ज की गई। धान के संदर्भ में विश्व में भारत तीसरे स्थान पर रहा और वह भी तब जब भारत के भंडारण गृहों में भारी मात्रा में अतिरिक्त खाद्यान्न उपलब्ध था।
बाजार मूल्य पर दबाव कम करने के लिए जुलाई-अगस्त में थोक उपभोक्ताओं तथा छोटे निजी व्यापारियों के लिए एफसीआइ ने 26.02 लाख टन गेहूं की टेंडर के आधार पर बिक्री की थी। इससे घरेलू बाजार में गेहूं के दामों को कम करने में मदद मिली। दामों को कम करने में एफसीआइ की इस नाजुक भूमिका में बदलाव के सरकार के फैसले में मुझे कोई औचित्य नजर नहीं आता। सरकार की नई योजना से एफसीआइ खाद्यान्न के दाम घटाने के बजाय बढ़ाने में प्रमुख भूमिका निभाएगी। सट्टेबाजी में उतरने के बाद पहले से ही ऊंचे रेट फिक्स करके एफसीआइ महंगाई बढ़ाने के सबसे बड़े खिलाड़ी के रूप में उभरेगा। यह खाद्यान्न की भारी मात्रा के बल पर बाजार का रुख मोड़ सकने की ताकत रखता है।
इसका सीधा असर खाद्यान्न के दामों में तीव्र वृद्धि के रूप में देखने को मिलेगा। अंतरराष्ट्रीय बाजारों पर एक नजर डालकर देखा जाए कि इनमें हमारे लिए क्या सीख हो सकती है। 2007 में जब वैश्विक खाद्यान्न संकट चरम पर था और 37 देशों में खाद्यान्न को लेकर दंगे भड़क रहे थे, संयुक्त राष्ट्र की विशेष रिपोर्ट में कहा गया था कि खाद्यान्न के दाम बढ़ने के पीछे सबसे बड़ा हाथ सट्टेबाजी का था। खाद्यान्न की कीमतें मांग और आपूर्ति से तय नहीं हो रही थीं, बल्कि वित्तीय अटकलें और सट्टेबाजी में निवेश इनकी बढ़ोतरी के कारक थे। मानवीय पीड़ा और भूखे पेट की कीमत पर कुछ कृषिव्यापार क्षेत्र की बड़ी कंपनियों ने मोटा मुनाफा कमाया।
2012 के उत्तरार्ध में एक बार फिर वैश्विक खाद्यान्न की कीमतों में जबरदस्त उछाल देखने को मिल रहा है। अमेरिका में सूखे की आशंका और रूस व उक्रेन में खाद्यान्न उत्पादन में कमी से खाद्यान्न में व्यापार करने वाली विश्व की सबसे बड़ी कंपनी कारगिल मालामाल हो गई। एक अन्य बड़ी कंपनी ग्लेनकोर भी इसी राह पर चल रही है।
एफसीआइ को व्यापारिक इकाई में बदलने में गंभीर खतरे निहित हैं। भारत जैसे विशाल देश में, जिस पर विश्व में सबसे अधिक भूखी आबादी का दाग लगा है, एफसीआइ मुख्यत: दो भूमिकाएं निभाता है। पहली भूमिका यह है कि यह किसानों से पहले से तय की गई कीमतों पर खाद्यान्न की खरीदारी करता है। भारतीय किसानों के लिए सरकारी उसकी फसल का लाभकारी मूल्य दिलाती है। यद्यपि हर साल 22 फसलों का खरीद मूल्य घोषित किया जाता है, एफसीआइ केवल गेहूं और धान की खरीद ही करता है। गेहूं और धान का उत्पादन बढ़ने का यही प्रमुख कारण है। सरकारी खरीद बंद करने और एफसीआइ के बाजार में दखल देने की नई भूमिका से भारत में कृषि बर्बाद हो जाएगी। देश के जिन भागों में एफसीआइ सक्रिय नहीं है, वहां किसान बहुत कम कीमत पर गेहूं और धान बाजार में बेचने को मजबूर हैं। इस प्रकार एफसीआइ तो पहले से ही मूल्य जोखिम प्रबंधन की जिम्मेदारी निभा रहा है। अमेरिका के अनुभव से स्पष्ट हो जाता है कि इन आर्थिक जिम्मेदारियों को निभाने की सट्टा बाजार से की जा रही अपेक्षाएं महज खयाली पुलाव हैं।
अमेरिका के शिकागो में विश्व का सबसे बड़ा कमोडिटी एक्सचेंज है, इसके बावजूद अमेरिका में सट्टेबाजी से किसानों का कोई भला नहीं हुआ। कृषि को लाभकारी बनाने में सट्टेबाजी की विफलता के कारण ही अमेरिका किसानों को भारी भरकम सब्सिडी प्रदान करता है। फूड बिल 2008 में पांच साल के लिए 307 अरब डॉलर (करीब 16 लाख करोड़ रुपये) की सब्सिडी का प्रावधान किया गया था। इसमें संदेह नहीं कि एफसीआइ में भ्रष्टाचार व्याप्त है, किंतु इसे खत्म कर देना एक बड़े विनाश की ओर ले जाएगा। इससे भारत फिर से खाद्यान्न आयातक देश बन जाएगा और खाद्य सुरक्षा खतरे में पड़ जाएगी। जाहिर है, इससे भुखमरी तो बढ़ेगी ही।
[लेखक देविंदर शर्मा, कृषि मामलों के विशेषज्ञ हैं]
Source: Dainik Jagran, Nov 23, 2012.
http://in.jagran.yahoo.com/news/opinion/general/6_3_9873871.h
Are a handful of Corporates holding the global economy to ransom? Are political leaders afraid to fall from 'fiscal cliff'
Millions of workers protested against spending cuts across Europe on Nov 14. This picture is from Madrid/Spain.
I don't understand how can any sensible person, least of it an economist or a policy maker, justify this paradox. The US economy is in crisis when many businesses are sitting on record levels of cash on their balance sheets. "Amid a lackluster earning season that have featured many companies missing sales expectations, cash balances have swelled 14 per cent and are on track toward $ 1.5 trillion for the Standard & Poor's 500, according to JP Morgan. Both levels would be historic highs "(Companies Are Sitting on More Cash Than Ever Before. CNBC.com Oct 23, 2012. http://bit.ly/RGCSRz). Apple alone sits over $ 117 billion.
What's the situation in Europe? According to Ernst & Young "In the Eurozone, corporates overall hold around Euro 2 trillion, in the UK the FTSE 100 are holding 750 billion pound sterling, and US corporates hold more than US$ 2 trillion."
US President Barack Obama, getting into his second term, had talked consistently about the "rich paying their share" to prop up the sagging economy. Many believe he won because he spoke the language of the majority, the 99 per cent. But no sooner the elections results were out, I see the mainline economists launching a tirade against his election promise of imposing higher taxes on the rich. You watch them articulating their flawed hypothesis on CNN, you can read them in The Economist, and of course their voice resonates in the corporate-controlled media across the globe.
The "fiscal cliff' argument is so strong and so well entrenched in the political thinking that the European governments too have been blindly adopting it to overcome the euro zone's debt crisis.
Far away in India, at a time when GDP is on a downhill path, newspaper reports say: "At the end of last fiscal, India Inc was sitting on cash and cash equivalents -- liquid investments that can easily be converted to cash -- of over Rs 9.3 lakh-crore or $ 166 billion." (Slowing Economic Growth: Companies like RIL, CIL and Infosys sit on a cash pile of Rs 9 lakh crore and refuse to invest. Economic Times, Aug 20,2012. http://bit.ly/RGCSRz).And still, the UPA II is Gung-ho over the move to open up for FDI in retail, expecting just $ 3 billion in the next five years !
At a time when so much money is in the hands of few corporates, I don't see any justification for the term 'fiscal cliff' to be flaunted all around. Not being a trained economist, it took me some effort to understand what 'fiscal cliff' actually means -- to overcome the growing fiscal deficit, increasing taxes and simultaneously going in for spending cuts. In other words, spending cuts means ushering in austerity. Ensuring austerity means reducing the fiscal deficit. That's what the IMF/World Bank prescribe when they lend monies for bailouts. But for some strange reasons, austerity does not mean providing tax concession to the rich and powerful. At the time when the world provided economic bailout packages (after 2008-09 economic meltdown) of roughly $ 20 trillion, no economist warned of "fiscal cliff". No economist told us not to use the public tax-payers money to bail out the banks and the corporates.
In simple words, $ 20 trillion have gone in to shore up the bottom line of Big Business, insurance, banks and industry. It provided more wealth in the hands of the wealthy. In such difficult times, when the bailout packages should have been for providing more employment, health, education and food to the needy, it went into the pockets of the rich. The trickle down did not happened, it never happens. The entire economic system therefore works on the underlying but utterly flawed principle: "Privatisation of profits, and socialisation of costs.'
In US, despite the public rhetoric of President Obama, the fact remains as the New York Times states: "the White House agreed to cut at least $ 250 billion from Medicare in the next 10 years and another $ 800 billion in the decade after that, in part by raising the eligibility age. The administration had endorsed another $ 110 billion or so in cuts to Medicaid and other health care programmes, with $ 250 billion more in the second decade. And in a move certain to provoke rebellion in the Democratic ranks, Obama was willing to apply a new, less generous formula for calculating Social Security benefits, which would start in 2015." Even for the much-needed Supplemental Nutrition Assistance Programme, the proposal is to cut spending by $ 127 billion.
In Europe, as Reuters reports: "In Portugal and Greece — both rescued with European funds and under strict austerity programmes — the economic downturn sharpened in the third quarter, data showed. Portuguese unemployment jumped to a record 15.8 per cent while next door, in Spain, one in four of the workforce is jobless. Greece’s economic output shrank by 7.2 per cent on an annual basis in the third quarter as the debt-laden country staggers towards its sixth year of depression. Close to 26 million people are unemployed in the European Union while governments take aim at spending on treasured universal health care and public schools. Spain, Portugal and Greece have all slashed spending on pensions, public sector wages, hospitals and schools. But frustration has mounted as the cuts aggravate the downturn. In Spain, most of the savings have been gobbled up to meet higher interest payments on the national debt, swollen by the cost of rescuing banks after a real estate bubble burst." (Workers in Europe synchronise anti-austerity strikes. Nov 15, 2012. http://bit.ly/TKyMIZ).
With millions of workers thronging the streets across Europe in protest against spending cuts which has aggravated recession and led to mass unemployment, the frustration is growing. Whether it is the US, Europe or India, the average citizen is angry at the policies that is cutting into social security funding making it more difficult for them at times of an economic recession. But is this a sacrifice that the poor have to entail? How long can the ordinary people be made to suffer while the rich sit pretty over tons of hoarded cash? How long can the economic system allow concentration of wealth into the hands of a few while the world struggles for a decent livelihood?
Knowing that John Maynard Keynes had said: "The boom, not the slump, is the right time for austerity", I turned to Paul Krugman to see whether he prescribes any other solution. Here he goes:
"Back in 2010, self-styled hawks -- better described as deficit scolds -- took over much of our political discourse. At a time of mass unemployment and record low-borrowing costs, a time when economic theory said we needed more, not less, deficit spending, the scolds convinced most of our political class that deficits rather than jobs should be our top economic priority. And now that election is over, they are trying to pick up where they left. (Deficit hawks and Hypocrites. New York Times. http://nyti.ms/TAy0Mr)
They should be told to go away."(emphasis mine)
Reading Paul Krugman, and seeing the mass protests around the world, it is quite clear that a few corporates are holding the economy to ransom. Look at the Indian Prime Minister Manmohan Singh. To overcome the difficult prevailing economic situation, he is asking the cash-rich 25 public sector undertakings to invest Rs 2.5 lakh crore surplus they hold 'to reignite the economy'. But no such appeal is made to the private sector companies which are sitting over massive hoarded cash estimated to be more than 9-lakh crore or $ 166 billion. Is he afraid of annoying the corporates? Yes, he is. And so is President Obama, unless of course he walks the talks.
It seems unlikely that governments across the world are going to make any concerted effort to force the Big Business to cough out the cash they are sitting on. This is because as Paul Krugman says we have allowed the deficit hawks to hijack the economic agenda. It is because we keep quiet that the hawks take over. The fault is as much ours as theirs. #
Also see: Are Corporation holding the Global Economy for Ransom? Nov 17, 2012, Znet.
http://bit.ly/UMGHVa
Dalai Lama: "If only Tibet had Oil ..."
A teenager died this week in the 70th case of immolation since Feb 2009 in Tibet -- India Today photo
Several years ago, must be sometimes between 1988-89, I was interviewing Dalai Lama at McLeod Ganj, a suburb of Dharamsala, where he lives in exile. I was then the State Correspondent for the Indian Express, posted in Shimla. It was during the course of the pretty-long interview wherein we had discussed about what Dalai Lama called as 'cultural genocide' in Tibet, I asked him whether the peaceful path he had always advocated and stands for would ever get him closer to an autonomous Tibet.
Dalai Lama burst out laughing. He said he knew that most young Tibetans would be calling him 'foolish' Dalai Lama for refraining them from adopting a militant path. He then went on to explain how the youth were getting impatient. We talked a little bit about the peaceful methods of Mahatma Gandhi from where he drew inspiration. And then, after a little while I asked him something like this: "You seem to be so helpless about the future of Tibet, and with the international community not pitching in for you, what is that you regret the most?"
Dalai Lama went quiet for sometime, and then he said: "If only Tibet had oil ..."
I have never forgotten those words. They still reverberate in my mind. Whenever I read any report about the struggle for free Tibet, Dalai Lama's words come back to me loud and clear. So when I read the New York Times report China's strange Tibetan silence (reprinted by Hindustan Times, Nov 11, 2012, http://bit.ly/UAVKBe), which talked of the series of self-immolation's that continues unabated since Feb 2009 killing 55 people while the remaining 15 are still grappling with life, I shudder at the silence that prevails in China, in India and of course worldwide. While Tibet burns, the world looks the other way.
Still worse, the report says: Whether it be antipathy or apathy, many Chinese have been unconsciously swayed by government propaganda that describes the self-immolators as "terrorists" even as unrelenting censorship blocks any public airing of their grievances, which include complaints about restrictions on Tibetan Buddhism and educational policies that, in some areas, favour Mandarin over Tibetan. I can understand the Chinese not wanting to talk about it, but what stops the United Nations Security Council from calling for a debate or discussion on the Tibetan uprising? Why can't US President Barack Obama, who got a second term last week, not have the courage to voice concern if not reprimand China for its act of repression? Why can't the European leaders -- British Prime Minister David Cameron, French President Francois Hollande and German Chancellor Angela Merkel raise this grave issue?
Well, we know why the world is quiet. As Dalai Lama had said: "If only Tibet had oil..."
I was reading another damming report in the Time weekly. Captioned: As Tibetans Burn Themselves to Protest Chinese Rule, Communist in Beijing Stress Happiness in Tibet (Time Nov 10, 2012, http://ti.me/VTUkHG). The report began by saying: "Two days before, five Tibetans had self-immolated in three different parts of the high plateau, among them three teenage monks and one young mother from Rebkong (known as Tongren in Chinese). Two other Tibetans burned themselves in Rebkong this week, according to overseas Tibetan groups.
Separately, in Xining, the provincial capital of China‘s western Qinghai province, where many Tibetans live, hundreds of Tibetan students joined together on the evening of Nov. 9 for a candlelight vigil to honor the protesters who, as flames engulfed their bodies, invariably shouted for an end to Chinese repression and the return of the Dalai Lama, Tibet’s spiritual leader who fled into exile in India after a failed uprising against Chinese rule more than five decades ago."
It is intriguing how the supreme sacrifice of one man in a distant land -- Tunisia -- triggers an Arab Spring toppling the governments of Tunisia, Egypt, Yemen, and Libya while it continues to threaten the governments of Syria and Jordan. Mohamed Bouaziz had doused himself before setting himself on fire, and the fire had spread so quick and so wide. That was in Dec 2010. And I don't think Bouaziz could have ever imagined the power of self-immolation. But how come, self-immolation by a young monk Tapey, in his mid-twenties, on Feb 27, 2009, in Tibet (http://bit.ly/ifvMLO) goes largely unnoticed outside Tibet's borders.
Within Tibet, Tapey's death had certainly triggered a storm. According to the International Campaign for Tibet 70 people have immolated themselves. This is indicative of the terror and repression that prevails in Tibet. But regardless of the grave human tragedy and continuous violation of human rights, the Chinese propaganda machinery continues to claim (as per the Time report): “The last 10 years was the period when the people in Tibet have gained the most benefits,” we were told by Padma Choling, the chairman of the Tibetan Autonomous Region. The accomplishments of the Communist government in Tibet were examined in voluminous detail. Airports have been built, schooling made free. Complimentary medical checks are being offered for monks and nuns, who can now watch the state-run news on televisions powered by new power lines. Kilometers upon kilometers of new roads have unfurled across the Tibetan moonscape.
The government has built greenhouses, shower facilities and garbage dumps for thousands of Tibetan Buddhist monasteries or nunneries with more than 20 clerics. Government health officials have given crucial information to nuns about how women’s bodies work. All Tibetan farmers and herders will be gifted “safe new houses” by 2013, according to Padma Choling. The urban unemployment rate is only 2.69% in the Tibetan Autonomous Region, reported a Han official in charge of the local Organization Department.
Tibetan capital Lhasa, we were instructed, has been voted the happiest city in China four times in a five-year period. “Happiness is dynamic, happiness need to be experienced,” enthused Che Dalha, the Communist Party secretary for Lhasa. “Today’s Lhasa is just like what they sing in the song: The sky in Lhasa is the most blue; the clouds in Lhasa are the most white; the water in Lhasa is the clearest; the air in Lhasa is the freshest; the sunshine in Lhasa is the brightest; and the people in Lhasa are the happiest.”
I bet if Tibet had oil, the United Nations, the World Bank/IMF and the Oil MNCs would have forced the big powers to act. The geo-political situation would have undergone a dramatic change. President Obama would have appealed (and issued a subtle warning) to the Chinese government for maintaining human rights. European governments too would have followed, and peace making countries like Switzerland, Norway and Sweden would have been active. Perhaps there would have been no need for it. The fight for the control of oil would have got Tibet its much desired Independence long ago.
Dalai Lama was so right: "If only Tibet had oil ...."
Food Corporation of India: Futures shock
At a time when the Global Hunger Index 2012 ranks India 65th among 79 countries, K V Thomas, minister of state for food and public distribution and consumer affairs, has revealed that the Food Corporation of India (FCI) will soon trade wheat in the futures market.
Seeking clearance from the Forward Markets Commission, the minister said: “The market has to perform the economic function of price discovery and price risk management.” Well, what I can see as the basic objective is to replace the open market sales scheme with trading in the futures market. In other words, futures trading will provide an opportunity for FCI to make some profits, which in turn can be ploughed back in its procurement operations, thereby reducing the subsidy outgo.
The issue isn’t as simple as is being made out. In addition to performing the sovereign role of procuring foodgrains, FCI’s relatively lesser known role is to keep a tab on food inflation. Whenever wheat and rice prices shoot up in the domestic market, open market releases are made from FCI stocks to bring down the market prices. For the year ending July 2012, the UN Food and Agricultural Organisation estimates that the wheat price rise in India was the second highest after Sudan. In the case of rice, price rise in India was third largest globally and that too, despite holding massive stocks of grain surplus.
To ease the pressure on market prices, FCI had made open market releases of 2.6 million tonnes of wheat for tender sales to bulk consumers and to small private traders in July-August. This helped stabilise domestic wheat prices.
I, therefore, see no economic justification and political wisdom in doing away with this crucial role that FCI plays in taming food inflation. In fact, it is the other way around. By entering the futures market, and trading available surplus wheat at higher prices, fixed in advance, FCI will eventually emerge as the biggest player in fanning inflation. It will be able to swing the futures market by the sheer power of the huge volume of physical stocks it holds. The resulting domino effect will see wheat market prices panicking.
Let’s take a look at the international markets and see if we can draw any inferences. In 2007, when the global food crisis was it its peak, with 37 countries witnessing food riots, the UN Special Rapporteur on Human Rights had said speculation in food was primarily responsible for the spike in food prices. Food prices were no longer driven by supply and demand, but by the actions of financial speculators and their investments. Profiteering on human misery and hungry stomachs had brought in a huge windfall for some of the biggest agri-business giants.
Global food prices are again on the upswing in the second half of 2012. The looming drought in the US, followed by a production shortfall in Russia and Ukraine, has already turned the fortunes for Cargill Inc, the world’s largest grain trading company. Its earnings in the first quarter of 2013 (ending August 31) reached a record $975 million compared to $236 million a year ago. Glencore, another giant trading firm, is ready for the kill. “The environment is a good one. High prices, lots of volatility, a lot of dislocation, tightness, and a lot of arbitrage opportunities,” Chris Mahoney, Glencore’s director of agriculture, was quoted as saying.
Turning FCI into a commercial entity is, therefore, fraught with dangers. In a country like India, which holds the dubious distinction of having the largest population of hungry people in the world, FCI performs essentially two roles. First, it provides an assured price to farmers by buying at the pre-fixed procurement price. For the Indian farmer, it is the procurement price that makes him realise a remunerative price for his harvest. Although procurement prices are announced for some 22 crops every year, it is only for wheat and rice that FCI makes purchases. And, it is primarily for this reason that production of wheat and rice has grown steadily.
Withdrawing the procurement and market intervention roles of FCI would see agriculture collapsing. Farmers in several parts of the country where FCI is not active have to resort to distress sale of wheat and rice. Even in Punjab, the food bowl, all efforts to diversify the cropping pattern have come to nought simply because farmers see an assured market only existing for wheat and rice. Price discovery and price risk management, therefore, are roles FCI plays. To expect the futures market to perform these economic functions is simply a fallacy, if we were to look at the American experience.
In the US, which hosts the biggest commodity exchange in Chicago, commodity trading has not helped farmers realise better prices. It is primarily because of the failure of commodity trading to convert agriculture into an economically viable proposition that the US provides for massive federal support to agriculture every five years. The Food Bill 2008 had made a provision of $307 billion, which includes direct income support, subsidies for land improvement, environment protection and crop insurance.
There is no denying that grain handling, storage and distribution are mired in corruption. But that is also true for the futures market. A recent multi-crore scandal in commodity trading of guar seed and guar gum had resulted in a temporary ban on a number of agricultural commodities. And, despite Thomas promising to initiate an enquiry by the Central Bureau of Investigation, it is business as usual for the commodity exchanges. FCI’s functioning, therefore, has to be improved, but to turn it into a commercial venture would be the first step to destroy the country’s hard-earned food self-sufficiency. It will also acerbate hunger.
Source: A futures shock from FCI Business Standard, New Delhi, Nov 10, 2012
bit.ly/Xrdo0g
Seeking clearance from the Forward Markets Commission, the minister said: “The market has to perform the economic function of price discovery and price risk management.” Well, what I can see as the basic objective is to replace the open market sales scheme with trading in the futures market. In other words, futures trading will provide an opportunity for FCI to make some profits, which in turn can be ploughed back in its procurement operations, thereby reducing the subsidy outgo.
The issue isn’t as simple as is being made out. In addition to performing the sovereign role of procuring foodgrains, FCI’s relatively lesser known role is to keep a tab on food inflation. Whenever wheat and rice prices shoot up in the domestic market, open market releases are made from FCI stocks to bring down the market prices. For the year ending July 2012, the UN Food and Agricultural Organisation estimates that the wheat price rise in India was the second highest after Sudan. In the case of rice, price rise in India was third largest globally and that too, despite holding massive stocks of grain surplus.
To ease the pressure on market prices, FCI had made open market releases of 2.6 million tonnes of wheat for tender sales to bulk consumers and to small private traders in July-August. This helped stabilise domestic wheat prices.
I, therefore, see no economic justification and political wisdom in doing away with this crucial role that FCI plays in taming food inflation. In fact, it is the other way around. By entering the futures market, and trading available surplus wheat at higher prices, fixed in advance, FCI will eventually emerge as the biggest player in fanning inflation. It will be able to swing the futures market by the sheer power of the huge volume of physical stocks it holds. The resulting domino effect will see wheat market prices panicking.
Let’s take a look at the international markets and see if we can draw any inferences. In 2007, when the global food crisis was it its peak, with 37 countries witnessing food riots, the UN Special Rapporteur on Human Rights had said speculation in food was primarily responsible for the spike in food prices. Food prices were no longer driven by supply and demand, but by the actions of financial speculators and their investments. Profiteering on human misery and hungry stomachs had brought in a huge windfall for some of the biggest agri-business giants.
Global food prices are again on the upswing in the second half of 2012. The looming drought in the US, followed by a production shortfall in Russia and Ukraine, has already turned the fortunes for Cargill Inc, the world’s largest grain trading company. Its earnings in the first quarter of 2013 (ending August 31) reached a record $975 million compared to $236 million a year ago. Glencore, another giant trading firm, is ready for the kill. “The environment is a good one. High prices, lots of volatility, a lot of dislocation, tightness, and a lot of arbitrage opportunities,” Chris Mahoney, Glencore’s director of agriculture, was quoted as saying.
Turning FCI into a commercial entity is, therefore, fraught with dangers. In a country like India, which holds the dubious distinction of having the largest population of hungry people in the world, FCI performs essentially two roles. First, it provides an assured price to farmers by buying at the pre-fixed procurement price. For the Indian farmer, it is the procurement price that makes him realise a remunerative price for his harvest. Although procurement prices are announced for some 22 crops every year, it is only for wheat and rice that FCI makes purchases. And, it is primarily for this reason that production of wheat and rice has grown steadily.
Withdrawing the procurement and market intervention roles of FCI would see agriculture collapsing. Farmers in several parts of the country where FCI is not active have to resort to distress sale of wheat and rice. Even in Punjab, the food bowl, all efforts to diversify the cropping pattern have come to nought simply because farmers see an assured market only existing for wheat and rice. Price discovery and price risk management, therefore, are roles FCI plays. To expect the futures market to perform these economic functions is simply a fallacy, if we were to look at the American experience.
In the US, which hosts the biggest commodity exchange in Chicago, commodity trading has not helped farmers realise better prices. It is primarily because of the failure of commodity trading to convert agriculture into an economically viable proposition that the US provides for massive federal support to agriculture every five years. The Food Bill 2008 had made a provision of $307 billion, which includes direct income support, subsidies for land improvement, environment protection and crop insurance.
There is no denying that grain handling, storage and distribution are mired in corruption. But that is also true for the futures market. A recent multi-crore scandal in commodity trading of guar seed and guar gum had resulted in a temporary ban on a number of agricultural commodities. And, despite Thomas promising to initiate an enquiry by the Central Bureau of Investigation, it is business as usual for the commodity exchanges. FCI’s functioning, therefore, has to be improved, but to turn it into a commercial venture would be the first step to destroy the country’s hard-earned food self-sufficiency. It will also acerbate hunger.
Source: A futures shock from FCI Business Standard, New Delhi, Nov 10, 2012
bit.ly/Xrdo0g
GM Crops: Hearing the warning bells
Environmentalists have been telling us about the presence of DDT residues in human milk and even traces of it in the blood of penguins. This tells us how widespread the use and abuse of this chemical is, but it took us more than 40 years to realise that DDT is a harmful persistent organic pollutant.
While the effort is to phase out the harmful chemical, I am worried about the growing emergence of biological toxins — like Bt — and the threat they pose to our health and environment. Newer estimates tell us that each Bt plant produces within itself a heavy dose of toxins equal to 4.2 kg per hectare, 19 times more than the average use of chemical pesticides. Still more worrisome is a recent Canadian study that shows widespread presence of Bt-related insecticides in the blood of 93% pregnant women and in 80% of foetuses.
This shocking study prompted Glenn Davis Stone, professor of anthropology and environmental sciences at the University of Washington, to ask: “What does this mean for human health impacts? Nobody knows.” That is exactly what worries the people. Why can’t scientists hold more long-term experiments to know of the potential dangers GM technology can have on human health and the environment?
Having failed to learn any lesson from the DDT debacle, the scientific community is pushing ahead for the acceptance of GM crops. So when the Supreme Court-appointed Technical Expert’s Committee (TEC) in its interim report suggested a moratorium for 10 years on field trials of GM crops till the time a regulatory mechanism is put in place, the GM industry reacted sharply.
The TEC report couldn’t have come at a better time. Only a few weeks ago, Giles-Eric Seralini, professor of molecular biology at the University of Caen, France, came out with another shocker. In a long-term study on rats for two years, he has demonstrated that when fed with GM maize and a particular herbicide, rats developed huge kidney and skin tumors, and also had digestive problems. Female rats developed fatal mammary tumours and pituitary disorders. In addition, the fatality rate was very high.
As expected, the industry reacted terming the study ‘bogus’, ‘fraudulent’ and ‘unscientific’. The rat study has shown how important it is to replicate such long-term experiments in multi-location trials. This is exactly what the TEC as well as the Standing Parliamentary Committee, which submitted its report in August, had also called for.
In case of agriculture, the claims have fallen flat. There is no GM crop in the world which increases crop productivity. US department of agriculture acknowledges low productivity of GM corn and GM soybean. The promise of reducing chemical pesticides usage has also been belied. In the US alone, pesticides use has increased by 404 million pounds between 1996 and 2011. In India, the Central Institute for Cotton Research has shown that pesticides usage in cotton has not decreased with the advent of Bt crops.
Still more worrisome is the emergence of super weeds and resistant insects. In America, more than 14.5 million acres are now afflicted with super weeds which are difficult to eliminate. As many as 23 weeds have now been classified as ‘super weeds’. Imagine the crisis that awaits farmers if GM crop field trials, without any effective regulatory system in place, continue to be allowed. A robust regulatory regime, with science-based long-term studies on the impact of GM crops on soil, animal and human health and the environment are desperately needed.
Source: Hearing the warning bells, Hindustan Times, Nov 9, 2012.
bit.ly/UcC7Ph
While the effort is to phase out the harmful chemical, I am worried about the growing emergence of biological toxins — like Bt — and the threat they pose to our health and environment. Newer estimates tell us that each Bt plant produces within itself a heavy dose of toxins equal to 4.2 kg per hectare, 19 times more than the average use of chemical pesticides. Still more worrisome is a recent Canadian study that shows widespread presence of Bt-related insecticides in the blood of 93% pregnant women and in 80% of foetuses.
This shocking study prompted Glenn Davis Stone, professor of anthropology and environmental sciences at the University of Washington, to ask: “What does this mean for human health impacts? Nobody knows.” That is exactly what worries the people. Why can’t scientists hold more long-term experiments to know of the potential dangers GM technology can have on human health and the environment?
Having failed to learn any lesson from the DDT debacle, the scientific community is pushing ahead for the acceptance of GM crops. So when the Supreme Court-appointed Technical Expert’s Committee (TEC) in its interim report suggested a moratorium for 10 years on field trials of GM crops till the time a regulatory mechanism is put in place, the GM industry reacted sharply.
The TEC report couldn’t have come at a better time. Only a few weeks ago, Giles-Eric Seralini, professor of molecular biology at the University of Caen, France, came out with another shocker. In a long-term study on rats for two years, he has demonstrated that when fed with GM maize and a particular herbicide, rats developed huge kidney and skin tumors, and also had digestive problems. Female rats developed fatal mammary tumours and pituitary disorders. In addition, the fatality rate was very high.
As expected, the industry reacted terming the study ‘bogus’, ‘fraudulent’ and ‘unscientific’. The rat study has shown how important it is to replicate such long-term experiments in multi-location trials. This is exactly what the TEC as well as the Standing Parliamentary Committee, which submitted its report in August, had also called for.
In case of agriculture, the claims have fallen flat. There is no GM crop in the world which increases crop productivity. US department of agriculture acknowledges low productivity of GM corn and GM soybean. The promise of reducing chemical pesticides usage has also been belied. In the US alone, pesticides use has increased by 404 million pounds between 1996 and 2011. In India, the Central Institute for Cotton Research has shown that pesticides usage in cotton has not decreased with the advent of Bt crops.
Still more worrisome is the emergence of super weeds and resistant insects. In America, more than 14.5 million acres are now afflicted with super weeds which are difficult to eliminate. As many as 23 weeds have now been classified as ‘super weeds’. Imagine the crisis that awaits farmers if GM crop field trials, without any effective regulatory system in place, continue to be allowed. A robust regulatory regime, with science-based long-term studies on the impact of GM crops on soil, animal and human health and the environment are desperately needed.
Source: Hearing the warning bells, Hindustan Times, Nov 9, 2012.
bit.ly/UcC7Ph
GM crops should go back to the lab
Some weeks ago, I was addressing students of molecular biology at the Kerala Agricultural University campus in Thiruvananthapuram. During the question-answer session, I asked how many of them would like to take up agricultural biotechnology as a career. To my surprise, only a couple of hands went up.
The answer I got probably points to the future of agricultural biotechnology in India. Most students wanted to go into animal biotechnology and human genetics, but not into crop biotechnology. The reason they gave was that they did not see a future for crop biotechnology, given the social backlash against it. Well, I am aware that this class is not an exact representation of the national mood among students, but surely it tells us a lot about the way society, more importantly the younger generation, perceives genetic engineering.
So, when the Supreme Court-appointed Technical Expert Committee (TEC) recommended a 10-year moratorium on all field trials of GM food crops, I was not surprised. The expert panel had merely echoed the concerns and apprehensions that society at large has towards such crops.
Knowing the casual manner in which large-scale field trials are held across the country, the absence of a regulatory mechanism, and the failure to document the damage transgenic crops have inflicted on humans and the environment during, before and after such trials, the committee has called for invoking the “precautionary principle.”
Knowing the casual manner in which large-scale field trials are held across the country, the absence of a regulatory mechanism, and the failure to document the damage transgenic crops have inflicted on humans and the environment during, before and after such trials, the committee has called for invoking the “precautionary principle.”
A few months ago, the Parliamentary Standing Committee on Agriculture tabled on August 9 its report Cultivation of Genetically Modified Food Crops: Prospects and Effects. After an exhaustive interaction with stakeholders, and considering the impact genetically modified food crops have on biodiversity, human health, the environment and the future of farming, it recommended: “for the time being all research and development activities on transgenic crops should be carried out only in containment, the ongoing field trials in all States should be discontinued forthwith.” In a way, the Parliamentary Standing Committee and TEC are saying the same thing.
Three years after Bt Brinjal — which, if allowed, would have been India’s first GM food crop — was put on indefinite hold, the reports of the Parliamentary Standing Committee on Agriculture and the TEC are pointers to swelling opposition to the manner in which GM crops are being pushed. Although many State governments have already refused permission for field trials of GM crops, I don't understand why Food and Agriculture Minister Sharad Pawar is time and again appealing to Chief Ministers to put GM research back on the agenda. Chairman of the Science Advisory Council to the Prime Minister (SAC-PM), Dr. C.N.R. Rao, too has lamented the lack of a “science-informed, evidence-based approach” in the debate.
In a desperate bid to support GM crops, it is often said that conventional agriculture technologies may be inadequate to meet India’s food security challenges. The other objection is that the debate is not “science-based.” Let us look at both arguments. As far as the role of GM crops in boosting food security needs is concerned, this argument is not “evidence-based.” First, there is no GM crop anywhere in the world which increases crop productivity. In fact, even the U.S. Department of Agriculture acknowledges that the productivity of GM soya and GM corn in the U.S. is less than the conventional varieties. Moreover, the prevailing drought in the U.S. has conclusively shown that it is only non-GM crops that have withstood the vagaries of weather.
In India, on June 1, a record 82.3 million tonnes surplus of wheat and rice was stored. This surplus existed at a time when an estimated 320 million people went to bed hungry. Mr. Pawar is making all efforts to export a large chunk of food stocks or make open market releases, but no serious effort is being made to feed the hungry. In fact, since 2001-03, India has been holding on an average anything between 50 to 60 million tonnes of foodgrains and yet its ranking in the Global Hunger Index shows no improvement.
Food insecurity, therefore, is not the result of any production shortfall. To ensure that farmers do not produce more, and thereby add to existing storage problems, the Commission for Agricultural Costs and Prices (CACP) has frozen the wheat price at last year’s level. Paying more to farmers would entail more production. This does not make any economic sense. After all, the farmer too is impacted by rising inflation. Why penalise farmers for the government’s inability to handle and store surplus foodgrain?
The fact remains that food production is being deliberately kept low, and only enough to meet basic food security needs. Provide market price to wheat and rice growers, and I am sure production will go up manifold.
SAC-PM is a committee made up of distinguished scientists. Although the Genetic Engineering Approval Committee (GEAC) had given the green signal for commercial cultivation of Bt Brinjal, the SAC-PM should take note of the 19-page submission by the then Minister for Environment and Forests, Jairam Ramesh; the analysis is the best “science-based” justification for stopping GM food crops.
Even when the Bt Brinjal debate was hot, I had pointed out the inability of the scientific community to conduct long-term feeding trials on rats. Internationally, the practice is to have 90-day feeding trials, which corresponds to 24 years of human lifespan — and that’s what the GEAC followed. I had always wondered why the industry as well as the scientific community was not conducting feeding trials for two years, which means the entire human lifespan. Professor Gilles-Eric Séralini, professor of molecular biology at the Caen University in France, finally did it. He recently published the findings of the two-year study on the long-term toxicity of GM maize NK 603, engineered to resist Roundup herbicide — and as expected the industry was up in arms.
In these first-ever long-term feeding trials on rats, published in the scientific journal Food and Chemical Toxicology, Prof. Séralini and his team observed that “females developed fatal mammary tumours and pituitary disorders. Males suffered liver damage, developed kidney and skin tumours and experienced problems with their digestive system.” The team also found that even lower doses of GM corn and Roundup weedicides resulted in serious health impacts. Moreover, 50 per cent male and 70 per cent female rats died prematurely. The tumours were 2.5 times bigger than what would normally appear in the control population.
As expected, the study was branded “bogus,” “inadequate” and of course “unscientific.” Séralini answered the industry’s main criticism pointing out that the species of rat used was the same that the biotech giant Monsanto had used in its research trials. Moreover, the sample size was as per the recommendations of the Organisation for Economic Co-operation and Development (OECD) protocol for GM food safety toxicology studies. Séralini’s experiment has amplified the need for long-term human safety trials, which I think the SAC-PM should be primarily asking the Department of Biotechnology to focus on. SAC-PM needs to review more scientific literature before making any broad and sweeping assertions.
At a time when GM crops hold no promise of higher crop production, the latest long-term scientific research on the impacts on health warrants repeated trials under all environments. As suggested by TEC and the Standing Committee, more experiments are needed on farm animals.
Since science is answerable to society, and cannot be allowed to operate in a vacuum, this is the least India can do to dispel any fear. #
Source: GM Crops should go back to the lab, The Hindu, Nov 8, 2012
http://www.thehindu.com/opinion/op-ed/gm-crops-should-go-back-to-the-lab/article4074872.ece#
My $ 1 Trillion Plan: Enough to wipe out hunger, poverty and disease from India.
Every now and then I read about the desperate need to invest $ 1 trillion in infrastructure projects in India. Prime Minister Manmohan Singh has reiterated this time and again. Addressing the Asian Development Bank at Manila in May, former Finance Minister (and now the President of India) Pranab Mukherjee said: "India needs about USD 1 trillion in the next five years for infrastructure development, out of which at least 50 per cent has to come from the private sector. Therefore, there is a huge scope for investments in India." He of course also said that the focus remains on inclusive growth.
In June 2012, Manmohan Singh outlined his plan (see India's $ 1 Trillion Plan. http://www.energyandcapital.com/articles/indias-1-trillion-plan/2246) while speaking at a meeting of the Ministers and Secretaries concerned with the departments of power, railway, road, shipping, civil aviation, and coal besides of course the Planning Commission. He said:“India is at a critical juncture in its quest for prosperity and eradication of poverty...We are running into more turbulent weather...There is a need to revive business and investor sentiments...and a need to create an atmosphere conducive to investment ... In the short term, development of infrastructure will boost investment rates across the economy. In the long run, it will remove the supply constraints that affect economic activity in agriculture, industry and trade.”
If you would have noticed, he began by saying that India is at a critical juncture in its quest for prosperity and eradication of poverty (emphasis mine). In other words, it means the basic purpose of seeking $ 1 trillion investment is to pull the country out of dismal poverty and hunger. Following the trickle down theory, what the Prime Minister is suggesting is that the more investment we make in creating infrastructure the more it will help in removing poverty and hunger. I had posed this question some years back to late Dr Mehbub-ul-Haq, a former Finance Minister of Pakistan, who was also the founder editor of the UN Human Development Report. He replied: "We were wrongly taught that we should take care of GDP and it will automatically take care of poverty. Let us reverse it. We need to take care of poverty and it will automatically take care of GDP." (You can read my Aug 2000 article Poverty: Look beyond GDP growth. http://www.twnside.org.sg/title/2086.htm).
Since 75-80 per cent of the world's poor do not have any social protection, the UN Special Rapporteur on Right to Food Dr Olivier de Schutter has called for a Global Fund for Social Protection (GFSP). Accordingly, 2-6 per cent of global GDP, or $ 1.26 trillion to 3.79 trillion (based on 2010 GDP figures) needs to be ensured for providing comprehensive rights-based social protection schemes that reduce vulnerabilities of local populations and provides them security (See the executive summary at: http://www.srfood.org/images/stories/pdf/otherdocuments/20121009_gfsp_execsummary_en.pdf).
Olivier de Schutter is demanding a minimum of $1.26 trillion to ensure social livelihood protection for the world's poor. For a country like India, which has one-third of the world's hungry and an equal percentage of poverty stricken, plus where 47 per cent children below the age of five continue to be malnourished, its share would be much less. But given the magnitude of the crisis, and knowing that poverty eradication is not as simple and straight forward as is generally made out to be, I still feel that what Mehbub-ul-Haq had said is the ultimate way out. The $ 1 Trillion investment on infrastructure development is not going to make any appreciable dent on poverty removal. It has to be the other way around. Make investments on the human capital -- removing poverty, hunger and disease -- and we will see a stupendous rise in economic growth.
If I were in place of Dr Manmohan Singh, my $ 1 Trillion Plan would be radically different from his. I would aim primarily at removing hunger and poverty. I would begin by first ensuring food security at the household level, ensuring local production, local procurement and local distribution. Food security has to be an integrated part of the cropping system whereby sustainable agriculture would get a massive thrust. Turning farming into an economically viable proposition would sow the seeds of not only reverse migration but also ushering in rural prosperity. I an never forget a Punjabi saying: "Jeede ghar daane, ude bachhe bhi sayanne." Translated it means that he who has ample food in his house, his children would be healthy, wealthy and wise.
Poverty eradication therefore has to be directly linked with household food security.
My objective here is not to list out the steps that would be required to be undertaken for turning India into a place where happiness resides. All I am trying to say is that $ 1 trillion is what is required to wipe out poverty, hunger and diseases from the country. At present India is a $ 1.3 economy, where only a fraction of the population is gaining from the massive investments being made in Bharat Nirman and urban centre growth. The inequalities are widening with the rich becoming strikingly rich and the poor being further marginalised. This has to be reversed.
Pulling out 320 million people from hunger and an estimated 470 million from below the poverty line is the kind of investments that I would utilise $ 1 trillion for. Of course, several scheme will be woven around the creation of requisite infrastructure (not palatial housing for the stinking rich) providing employment both in the rural and urban areas. Education, health and housing will remain the priority sectors. Such policies will have to be redesigned. These have to be centered around sustainable development, policies which do not lead to exploitation of natural resources, do not contaminate the environment, destroy the soil fertility, pollute water and adds to global warming.
Real economic growth only happens when no one goes to bed hungry in a nation. This has to be on a sustainable basis. When every policy percolates to minimising hunger and poverty, why not make a direct assault to make hunger and poverty history. My $ 1 Trillion Plan would aim at not only making hunger and poverty history, but also wiping out disease and squalor.
In June 2012, Manmohan Singh outlined his plan (see India's $ 1 Trillion Plan. http://www.energyandcapital.com/articles/indias-1-trillion-plan/2246) while speaking at a meeting of the Ministers and Secretaries concerned with the departments of power, railway, road, shipping, civil aviation, and coal besides of course the Planning Commission. He said:“India is at a critical juncture in its quest for prosperity and eradication of poverty...We are running into more turbulent weather...There is a need to revive business and investor sentiments...and a need to create an atmosphere conducive to investment ... In the short term, development of infrastructure will boost investment rates across the economy. In the long run, it will remove the supply constraints that affect economic activity in agriculture, industry and trade.”
If you would have noticed, he began by saying that India is at a critical juncture in its quest for prosperity and eradication of poverty (emphasis mine). In other words, it means the basic purpose of seeking $ 1 trillion investment is to pull the country out of dismal poverty and hunger. Following the trickle down theory, what the Prime Minister is suggesting is that the more investment we make in creating infrastructure the more it will help in removing poverty and hunger. I had posed this question some years back to late Dr Mehbub-ul-Haq, a former Finance Minister of Pakistan, who was also the founder editor of the UN Human Development Report. He replied: "We were wrongly taught that we should take care of GDP and it will automatically take care of poverty. Let us reverse it. We need to take care of poverty and it will automatically take care of GDP." (You can read my Aug 2000 article Poverty: Look beyond GDP growth. http://www.twnside.org.sg/title/2086.htm).
Since 75-80 per cent of the world's poor do not have any social protection, the UN Special Rapporteur on Right to Food Dr Olivier de Schutter has called for a Global Fund for Social Protection (GFSP). Accordingly, 2-6 per cent of global GDP, or $ 1.26 trillion to 3.79 trillion (based on 2010 GDP figures) needs to be ensured for providing comprehensive rights-based social protection schemes that reduce vulnerabilities of local populations and provides them security (See the executive summary at: http://www.srfood.org/images/stories/pdf/otherdocuments/20121009_gfsp_execsummary_en.pdf).
Olivier de Schutter is demanding a minimum of $1.26 trillion to ensure social livelihood protection for the world's poor. For a country like India, which has one-third of the world's hungry and an equal percentage of poverty stricken, plus where 47 per cent children below the age of five continue to be malnourished, its share would be much less. But given the magnitude of the crisis, and knowing that poverty eradication is not as simple and straight forward as is generally made out to be, I still feel that what Mehbub-ul-Haq had said is the ultimate way out. The $ 1 Trillion investment on infrastructure development is not going to make any appreciable dent on poverty removal. It has to be the other way around. Make investments on the human capital -- removing poverty, hunger and disease -- and we will see a stupendous rise in economic growth.
If I were in place of Dr Manmohan Singh, my $ 1 Trillion Plan would be radically different from his. I would aim primarily at removing hunger and poverty. I would begin by first ensuring food security at the household level, ensuring local production, local procurement and local distribution. Food security has to be an integrated part of the cropping system whereby sustainable agriculture would get a massive thrust. Turning farming into an economically viable proposition would sow the seeds of not only reverse migration but also ushering in rural prosperity. I an never forget a Punjabi saying: "Jeede ghar daane, ude bachhe bhi sayanne." Translated it means that he who has ample food in his house, his children would be healthy, wealthy and wise.
Poverty eradication therefore has to be directly linked with household food security.
My objective here is not to list out the steps that would be required to be undertaken for turning India into a place where happiness resides. All I am trying to say is that $ 1 trillion is what is required to wipe out poverty, hunger and diseases from the country. At present India is a $ 1.3 economy, where only a fraction of the population is gaining from the massive investments being made in Bharat Nirman and urban centre growth. The inequalities are widening with the rich becoming strikingly rich and the poor being further marginalised. This has to be reversed.
Pulling out 320 million people from hunger and an estimated 470 million from below the poverty line is the kind of investments that I would utilise $ 1 trillion for. Of course, several scheme will be woven around the creation of requisite infrastructure (not palatial housing for the stinking rich) providing employment both in the rural and urban areas. Education, health and housing will remain the priority sectors. Such policies will have to be redesigned. These have to be centered around sustainable development, policies which do not lead to exploitation of natural resources, do not contaminate the environment, destroy the soil fertility, pollute water and adds to global warming.
Real economic growth only happens when no one goes to bed hungry in a nation. This has to be on a sustainable basis. When every policy percolates to minimising hunger and poverty, why not make a direct assault to make hunger and poverty history. My $ 1 Trillion Plan would aim at not only making hunger and poverty history, but also wiping out disease and squalor.
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