Tuesday, May 8, 2007

Bitter Harvest

Vandana Shiva
The Times of India, 4 May 2007


Farmers of India are facing a deep crisis - 150,000 have committed suicide
in the last decade of trade liberalisation. Farmers' incomes are falling.
India's anti-farmer policies are heavily influenced by the World Bank - a
pity that the Bank's economists do not acknowledge this ('Produce And
Perish', April 26).

The crisis of farmers' falling incomes has evolved in two phases. First came
the Green Revolution (1965-1990). The second phase is the structural
adjustment and trade liberalisation phase. First, the Bank pushed India on a
monoculture path of chemical addiction. It provided credit to introduce a
capital intensive agricultural model.

The Bank and USAID exerted pressure for favourable conditions for foreign
investment in India's fertiliser industry, import liberalisation and
elimination of domestic controls to import fertilisers, seeds and
pesticides. The World Bank provided the credit.

The World Bank finances were an important element in the spread of a vast
network needed for distribution of Green Revolution varieties. In 1963, the
National Seed Corporation was established. In 1969, the Terai Seed
Corporation was started with a World Bank loan of $13 million. This was
followed by two National Seeds Project (NSP) loans.

The overall objective of the projects was to develop state institutions and
create a new infrastructure for increasing the production of certified
seeds. In 1988, the World Bank gave India a fourth loan for the seed sector
to make India's seed industry more market-responsive.

The involvement of the private sector, including multinational corporations,
in seed production is a special objective of NSP III ($150 million). This
was viewed as necessary because sustained demand for seeds did not expand as
expected. In self-pollinated crops, especially wheat and rice, farmer
retention and farmer-to-farmer transfer accounted for much of the seed used.
The Bank pressure enabled the entry of seed corporations like Monsanto.
Today, most farmer suicides are precisely in those areas where Monsanto's
seeds have spread.

Monsanto has been taken to court for its monopolistic practices. The
hoarding and monopolistic practices of corporations like Cargill, Lever and
ITC have pushed up the price of wheat. Farmers are earning less and the poor
are paying more for food. The universal public distribution system was
dismantled under World Bank pressure as have the APMC Acts. India's food
security and sovereignty is being severely undermined by every policy
intervention of the World Bank. Trade liberalisation and structural
adjustment have added to the burden of Indian farmers.

Liberalisation under the structural adjustment programme of World Bank
consists of the following elements: Liberalising fertiliser imports and
deregulating domestic manufacturing and the distribution of fertilisers;
removing land ceiling regulation, subsidies on irrigation, electricity and
credit and creating conditions to facilitate the trading of canal irrigation
water rights; deregulating the wheat, rice, sugarcane, cotton and edible oil
and oilseed industries; dismantling the food security system; and removing
controls on markets, traders, and processors, and subsidies to cooperatives.

Other elements are abolishing the Essential Commodities Act; the general ban
on futures trading; inventory controls; and selective credit controls on
inventory financing; treating farmers cooperatives on an equal footing with
the private sector.

The Bank is recommending that India stops focusing on food grains and
instead focus on export crop such as vegetables, shrimps and flowers. The
World Bank's recent report only addresses horticulture for exports. This
will not improve farmers' incomes; it will rob them of land and livelihoods.
Export crops are at the root of the land conflicts in Barnala, Punjab. An
Action Aid report shows how giant corporations drive down prices of
agricultural produce. Hooking India's agriculture to Wal-Mart and TESCO will
dispossess and deprive Indian farmers.

Our recent report on Corporate Hijack of Retail also shows how the model of
corporate industrial globalised agriculture - that the World Bank is
promoting - leads to falling prices for farmers and rising prices for