GLOBALIZATION AND POVERTY:

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Interview with Dr. Vandana Shiva By Gary Null Progressive Radio Network, Broadcast December 16, 2008

GARY NULL (GN): My guest today is one of the more remarkable individuals that you will ever hear speak on the subjects that we’re going to discuss: the relationship between globalization and poverty, the oil industry’s destruction of agriculture, plus other issues involving the disposition of land and power and the body politics in Africa and India. Dr. Vandana Shiva is one of India’s top nuclear physicists and an internationally renowned environmental and social activist. She has been credited as a principal founder of India’s ecological and eco-feminism movement.
In 1982 she founded The Research Foundation for Science and Technology and Ecology in New Delhi, which led to the creation of an organization, Navdanya, dedicated to the restoration of organic farming across India and the preservation of indigenous knowledge and culture. For several decades Vandana has fought for changes in the globalized practices of agriculture and food and has traveled the world speaking against the bio-piracy of indigenous plants and their medicinal properties by large agriculture and pharmaceutical corporations. She has received numerous international awards including the Alternative Nobel Prize, UNEP’s Global 500 Award, and the UN Earth Day International Award. Her most recent book is “Soil Not Oil: Environmental Justice in An Age of Climate Crisis.” There are so many pressing issues in the world today, and I would like to start with one that is not getting the mainstream media attention that it deserves, specifically the relationship between corporate globalization and increased poverty, including the policies of the World Bank, IMF, the WTO and their western government backers. From your point of view how has the US and its aggressive push for free market economics contributed to the increase in poverty and a widening of the gap between the haves and have nots throughout the world, especially in light of Barack Obama recently stating that he is very much for globalization and free market efforts.

VANDANA SHIVA (VS): I think India is a good test case to see how globalization increases real poverty even while measurements of growth make it look like the country is booming. India’s growth these last few years has been 9 percent and it is seen as one of the fastest growing economies. And yet in this decade of high growth under free market globalization India has the largest number of hungry people in the world. An agrarian society that has all the capacity to feed itself is today unable to feed its children partly because the land is being diverted for mining, for car companies and highways, and because agriculture itself is being diverted for luxury crops for the rich. One of the greatest tragedies of the new poverty that India is witnessing is the emergence of an epidemic of farm suicides. It’s one step beyond poverty to have to end your life because you’re so deeply indebted and the debt is completely related to corporate seed monopolies, such as Monsanto’s genetically engineered BT cotton. It’s a globalized agriculture controlled by a handful of agribusiness companies-the Cargill’s and ConAgra’s-and the WTO that wrote the rules of agriculture. The combination of seed and commodity controls has denied India its basic right to food, especially for the poor.

GN: There is also 9.1 percent growth in China and still 66 million hungry, unemployed people who are now beginning to protest. Do you believe that we will begin to see protests and riots in India such as what we have seen in Pakistan where the poor were not being subsidized and where there is no infrastructure to care for the poor?

VN: Actually protests are happening. Some protests come out in the language, voice and pain of the people themselves. They protest for land. They protest for food. They protest for water. They protest for forests, for the indigenous communities. But very often, just as our food is being genetically modified protests too are being genetically modified to appear as if they concern religion or are related to terrorism and extremism. And this mutation into a new form of response is partly a manipulation of those powers in control. They do not allow a farmer’s protest to be viewed as simply a farmers’ protest. This is what was happening in the state of Punjab two decades ago. Farmers’ protests were mutated into a protest about religion. Out of it came the invasion of the Golden Temple in Amritsar, the military standoff, and finally the assassination of Prime Minister Indira Gandhi who had ordered the army to deal with the issue of the Punjab and extremism. But today terrorism is made to look like it appears by itself. I can offer two examples of conflicts about land and livelihood which have been distorted to look like they’re conflicts initiated by people on the basis of caste, religion and ethnicity. We have had a major protest among the pastoral tribes in a region of Rajasthan, a desert area where livestock is the only economy because you can’t really farm extensively with very little water. All of those common lands which are pastoral have been handed over to industry to grow bio-fuel. The pastoralists are now without land as well as livelihood. When they protest they stop the entire transport system of India. Yet the protest is not written in the language of the land and people’s livelihood. It is written in the language of caste. Caste is a name for an occupation, just as pastoralists signify a pastoral occupation. Even the large Darfur conflicts in the Sudan, which are made to appear as if they are only about religious strife, is really about collapsing livelihoods with increasing desertification due to climate change. The settled agriculturalists and the pastoralists cannot meet their own needs. So they end up warring against each other. I think it is time for us to read the narrative of the new conflict and the new violence as distorted protests that were engineered to look like something else. And of course it suits the powerful and wealthy because they can keep free market globalization going and define war economies in every society as a means to contain terrorism.

GN: A lot of that has to do with policies on Wall Street and in Washington, which today are virtually one and the same. So if you have a peaceful protest of hungry farmers who cannot afford and do not want to use the genetically modified crops, such as cotton, and who are in such personal debt that they would rather commit suicide by the tens of thousands instead of seeing their families suffer anymore, then of course they would. But when you have people sitting on corporate boards and on Wall Street and in Washington who don’t give a damn about the Indian public-in fact they don’t even care about the average American because the average American is being thrown out on the street while these individuals are reaping humungous rewards by the very people who caused the problem. These are anti-civic individuals. How do you stop that mindset so that every truly progressive movement that deserves to be heard is not just stamped with the moniker of terrorist?

VN: I think the most important way to conduct resistance for a more just and peaceful society is to be absolutely committed to nonviolence. That was the bar of India’s freedom movement, and that is the bar of the civil rights movement in the United States-to challenge power and wealth strategically but also nonviolently. That is a very strong demand of our time. The second very important issue is to continue to defend the democratic right to dissent. After all what is democracy if not the right to dissent? A dictatorship doesn’t allow the right to dissent, a
nd as I’ve written in book after book corporate globalization has become a dictatorship. It is drawing states into implementing that dictatorship, and as long as corporate globalization implements this dictatorship it will destroy democracy. It will treat every legitimate democratic action as equal to the worst form of terrorism. So we stand for democracy and democracy is our birthright and our duty.

GN: In our society, like your own, we have our own caste system. There are the have’s and have not’s. I’ve never in my lifetime seen the powerful bring in the poor and ask for their advice. So how in the world are we ever to change any thing constructively if the most powerful people in the land surround themselves with the elitists and refuse to acknowledge that the poor and those less up the ladder also may have something constructive to offer? Was it not Albert Camus who said, “We rarely confide in those who are better than we are?” What if the ‘better’ means people with more humanistic and practical views of how to solve problems, such as the advocates of the organic movement? What if all of India, Africa, and the United States were to start looking at long-term sustainability of small agriculture projects in every community using organic heirloom instead of genetically modified crops? Think of the consequences to the water, to the air, to the land, to erosion, to reforestation, to sustainability and compatibility. And yet we have no such movement except at the grassroots level. Not a single dollar in the United States goes for organic, and yet everything goes for the big and very immoral food companies.

VS: During the last 20 years I’ve worked with both a scientific realization as well as a political realization that one of the most radical revolutions of our time is adopting biodiversity, saving open-pollinated seeds and practicing organic farming. As you said it’s a solution to every problem we face. It’s a solution to climate change. Moving beyond oil returns more to the soil, and we find in an ecological and organic agriculture both the mitigation and the adaptation strategies for knowing how to deal with the mess that a fossil fuel civilization has created. Organic food is the best solution to the biggest health problem of our time. Two billion obese and ill with food-related diseases. One billion denied their rights to food. Hence three billion are denied the right to wholesome food that can be solved with a local ecologically robust food economy. Then there is the issue of water. Ten times more water is used in industrial chemical agriculture. Water is clearly a limiting factor and will become more of a crisis as climate change melts our glaciers, dries up our springs, and leaves more and more areas water scarce. It’s also a solution to the conflicts all around us. I recently returned from a long field trip in the very poor Indian state of Orissa. Culturally, in terms of peace and harmony between nature and people and between people and people, there are amazing examples. Every villager has the deepest humanity. Every villager has the deepest sense of self sufficiency and enough-ness. That is the future we have to strive for. And I think the biggest monopoly in our time is when agribusiness went into the oil economy. It is a new genetic engineering industry. They are not going to allow governments to move towards organic farming rapidly. They will try everything to force genetic engineering upon us. Two decades ago when I started the Navdanya movement in India, these companies had announced they would have all seeds patented and all crops genetically engineered by the turn of the century. They have so far only genetically engineered four crops on any significant scale: cotton, soy, rice and canola. They haven’t managed to patent everything under the sun, and we have built a movement that will not acknowledge patents. I call it the seed satyagraha just like Gandhi’s satyagraha when he told the British that nature gives salt for free. We need it for our survival. We will make our own salt. In the same way we get seeds from our ancestors and nature. We will continue to save them for future generations, and we will not obey patent laws. I believe if we keep saving our open-pollinated seeds, if we keep doing organic farming, and those in the cities commit themselves to eating only food that is genuinely free of patents, GMO’s, pesticides and toxins, and free of corporate control, we can succeed. Even if governments don’t change their policies we will have created another economy. And if you look at the growth of the movement, it has grown without policy protection in spite of adverse policies. When we combine the financial, climate and food crises, the manipulative corporate economies will not survive. The economies of care and compassion fight it by their recognition that we live on a very fragile earth and have a very high level of responsibility to protect it. If there’s going to be a future, it’s going to be found in people’s actions.

GN: I’ve always been an organic farmer, and I’ve been a major promoter of organic farming in the United States on a small scale. I’m a believer in moving back to the land, and then creating small sustainable communities. To grow one pound of organic potatoes takes 60 gallons of water. To grow one pound of meat, a 16 ounce steak, requires 12,000 gallons of water. If we’re running out of water, and we are, would you suggest that it would make sense to preserve our water by being conscious that you’re going to eat something that requires less? Now that meat has arachidonic acid. That arachidonic acid increases chemicals in the body called cytokines and tumor necrosis factors that result in inflammation. By eating organic and eating more naturally not only are avoiding these chemicals, besides many environmental toxins, but we are also saving water. Much food we buy at our corporate markets has traveled thousands of miles to reach our tables, and this leaves a large carbon footprint. So wouldn’t it be better to buy something local, support our local food crops and organic movements to lessen pollution? Isn’t it advantageous then to do everything we can to clean up the environment by going green? For those in India and other parts of the world who are principally vegetarian, and who care about life and the environment, do you imagine that at some point there needs to be a collective shift in consciousness that supersedes the power brokers and the policy makers, and says, “We tried it your way and look where we’re at. We’re now going to do it our way, and you’re welcome to join us, but we’re not going to listen to you anymore.”

VS: Just because the corporate media doesn’t cover it, doesn’t mean it’s not happening on a large scale. I think if you add together the people who want to eat and live consciously, who want to reduce the human ecological footprint on the planet, who want to do less harm to other human beings — because every economic system that does violence to the planet also violates the rights of fellow human beings — creates a powerful force in the world. I think as this information becomes more coherent and moves more quickly a conscious shift will take place. A year ago people would never have believed those of us who were saying all these measures of financial growth are fictitious. It’s just a bubble waiting to burst. Twenty years ago I started to organize rallies of half a million farmers in the street to declare that the agra-industrial system would kill our farmers. It was a death knell for our farmers and a recipe for hunger. People didn’t believe it. Today the farmers are committing suicide. Today the food prices have risen. Food sovereignty and local food systems are back on the agenda and that reveals the incoherence of the dominant corporate system. The governance of the truth we stand by, the truth of the earth, the truth of nature, the truth of justice is our greatest strength and that will only increase consciousness. From it we’ll only grow with every step along the way. The next five and ten years will be absolutely unpredictable times, but as long as we can hol
d our ground and hope, I believe the shift of consciousness will turn today’s dominators into the marginals who will be enlightened to come join our table of peaceful food and of abundant food.

GN: Well I absolutely agree with you. That was a very special insight. Now to two other areas that are not getting the attention, in my opinion, that they deserve in the United States. Every US administration, Democrat or Republican, has looked at profit as preferable to people. How has the mega corporations and western administrations given us a false utopian concept regarding human and economic development and environmental sustainability for raising people out of poverty? During the elections I didn’t see a single statement that was printed or a voice spoken about the hundred million poor in the United States, the 36 million who go to bed hungry each day, the 12 million children in the United States who don’t have enough to eat, let alone the 27 thousand children who die each year, and most of them from infections, from bad water or malnutrition. Not a word about these things, and yet they blather on as if somehow they’re in touch. I’m asking who are they in touch with? Since it’s always about profit and never about people.

VS: You know as the food crisis has intensified during the last year, food prices have doubled. But we’ve also seen the corporate profits driving the food system double. I think we now have a major contest between two futures. There’s the future that you and I are talking about and living in. It’s a future of providing food security to the last child on the basis of people working lovingly with the land. More farmers growing good food, growing organic food, and this will drive away hunger and food scarcity. I really find the United Nation’s millennium goals highly un-ambitious because seven or eight years ago they talked only about halving the number of people who go to bed hungry. Well, with ecological farming and biodiversity agriculture we are not only doubling and tripling but we could increase food production five-fold and nutritional production even higher because the foods grown organically have much higher levels of nutrition. That’s the way to address the problem of hunger. That’s the way to make sure society does not neglect people. Of course there is another agenda. And that agenda will attempt to use the crisis it has created to grab more of the food and agrarian economy. Look at what happened at the June Summit on climate and food. The biggest winner was fortune’s foremost Bill Gates and his foundation who wants to sell more chemical fertilizers to Africa, and then commercialize the food supply for Africa. The second winner was the genetic engineering lobby. Of course both of these plans are completely inappropriate. The prices of fertilizers are going high. Nitrogen fertilizers are a major cause of global warming because the nitrogen oxides emitted are 300 times more lethal in global warming than carbon dioxide. To push more chemical fertilizers during this period of climate change is doubly criminal because it will force African peasants into debt, and then it will force all of humanity into an ecological debt. The genetic engineering lobby offered a false solution. They said only they can solve the problem of addressing climate change. They can’t because genetic engineering can only deal with single gene manipulations. Climate resilience in crops is a multi-genetic trait. They cannot engineer climate resilience. They can steal salt resistant seeds from us. They can steal flood resistant seeds from us. They can steal sources of seeds from us. I’m in fact preparing for our next campaign against bio-piracy-when agricorporations patent our traditional knowledge, our indigenous seeds. And when corporations are patenting, and there are 500 pending patents on climate resilience traits in crops, all of this is based on bio-piracy. Of course the real solution that we are offering is building community seed banks, building the commons for people to share as disasters happen. For example, we took salt tolerant rice down to the tsunami areas and drought tolerant rice to the areas in central India where they were having a four-year drought linked again to a climate catastrophe. The corporations will continue to seek profits. So we have to build on community. We have to build on people’s rights. And this contest is not going to go away in a hurry. But the fact that it doesn’t go away in a hurry doesn’t mean we don’t build the power of people.

GN: I would like to discuss the relationship between how the loss of natural biodiversity increases population growth and thereby increases poverty. If you would address the large agro-industrial players that you mentioned earlier and the destruction of biodiversity with their genetically modified seeds. I might mention that Hillary and Bill Clinton were sponsors of the Stevens Financial Group out of Little Rock, Arkansas, who was a major player in developing these genetically modified seeds. Under NAFTA and the WTO, the Clinton administration and its supporters thought it was a great idea. Little did they ever consider or care about the consequences. So if you would take a look at what it means to be forced into using seeds because your own natural seeds are no longer available. This has been true around the world where the World Bank and IMF went into almost every developing country and said, “We’ll give you a loan, but you must now give us structural adjustments. No more growing sustainable crops. No more small crops. Now you’re going to plant cash crops: cotton, soybeans, rubber and crops that you can get out of the country and sell abroad. That was also the case in India. Also speak about the contradiction between the great Green Movement, which won one person the Nobel Prize. But they weren’t looking at what this green revolution actually meant in terms of the average person.

VS: Well you know the Green Revolution was far from green. It was introduced in India in 1965 and ’66 when we had a drought. Because of the drought we needed to buy grain, and the US government said we could not have higher imports unless we changed our agriculture to the new seeds and the new chemicals. This package of new seeds that required chemicals is what is called the Green Revolution. The seeds had been evolved by Norman Borlaug who received the Nobel Peace Prize. The assumption was that commercializing and making agriculture more dependent on purchases would create a capitalist alternative to the spread of communism. And the reason the Green Revolution was called green was because it was contrary to red. It was not called green because it was ecological. The word green did not describe any ecological movement at that time. The Green Revolution was also pushed by the World Bank, which forced structural adjustments on India. It gave loans linked to structural adjustment to move seeds, pesticides and chemicals. The World Bank financed large dams that provided the intensive irrigation their seeds and chemicals required. Within the first few years 25 percent of the peasantry of Punjab had been wiped out. They were displaced from the land. Well within a decade, agriculture in Punjab had fallen into disarray, which is what then led to the extremist movement of the late ’70s and early ’80s. That was the basis of my book, “The Violence of the Green Revolution,” because I wanted to understand why the land, which was called the most prosperous, is today the angriest and why young Punjabis were taking to guns. What the Green Revolution basically did was push farmers into debt. It left the land desertified. It destroyed variety. Punjab used to grow 250 crop varieties. Today it grows monocultures of wheat and rice during two separate seasons and a monoculture of genetically engineered cotton. Punjab is one of the areas where we have large numbers of farm suicides. Twenty percent of the Punjab is now unfit for cultivation. Ten percent is water logged by putting too much water in intensive irrigation. Now this is precisely the package upon which the genetic engineering revolution has been built. The
biotechnology industry calls it the second green revolution, and Bill Gates wants to take this package to Africa as the Alliance for the Green Revolution in Africa. Gate’s, the Rockefeller’s and their corporate affiliates would like to bulldoze over Africa a green revolution like they bulldozed it on India in 1965 through conditions and through destruction of our sovereignty and democratic decision making. But the true green revolution is the ecological agriculture revolution. That’s what we are trying to build.

GN: A final question I would like you to address is the difference between what evolutionary biologists, such as the late Francisco Varella and others, call autopoetic systems as opposed to allopoetic systems. Autopoetic systems are those that are self-organized and are self renewed and such systems rely on biodiversity and are self-sustained. If agriculture, human development and economics were to think autopoetically there would be a flourishing of well being and sustainability. On the other hand, allopoetic systems are externally driven. This is what the entire Green Revolution believed in. Therefore, this revolution seized upon external stimuli to develop artificial energy and external resources. However, this is a completely mechanistic model. There is nothing holistic about it. It’s totally against what we’re talking about and requires increasing energy input like dumping more and more fossil fuels into an industry that would not be required if it was autopoetic.

VN: In my view, ecology is about self organization. It’s the ability of an eco system to clean itself up. That’s self organization, an autopoetic system. It’s about seeds being able to reproduce themselves. That’s an autopoetic system. A genetically engineered seed is an allopoetic system. It needs an external control for its reproduction. A genuine seed is a seed that needs only itself, some soil and sunshine to give you a plant. A child growing into an adult in their full humanity is an autopoetic system. Slaves live under allopoetic conditions. Chemical agriculture and industrial agriculture are allopoetic. The free market globalized economy is an allopoetic system. It’s externally organized. Sovereign local economies are autopoetic systems. Gandhi called this an economy of place, the ability to be creative and to produce for yourself and to meet your own needs. Self-organization is also the highest form of democracy. Democracy is not just going and voting. Genuine democracy is the ability to self-organize to make real decisions about how we are to live: to be able to shape our food system and our education. That means taking power back. That power will not be handed over to us by those who have taken it away. It will have to be shaped by our everyday actions. We will have to reclaim that deep democracy and that’s our autopoetic system.

GN: I want to thank you very, very much for being with us today. You’ve given us a lot of great insights, and hopefully people will read your new book, “Soil Not Oil: Justice in An Age of Climate Crisis,” or go to your website: www.vandanashiva.org and see all of your activities.

Gary Null, Ph.D. is the nation’s longest talk show host on alternative health on NPR and Pacifica radio stations, and an award winning director of documentary films. www.progressiveradionetwork.com

State tops national graph in farmers' suicides -1,520 In Vidarbh

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-TIMES NEWS NETWORK

State tops national graph in farmers’ suicides -1,520 In Vidarbha
In 2007, 4,238 Ryots Ended Life In State, 1,520 In Vidarbha Yavatmal: The
Union home ministry’s website displays the data of farmers’ suicides in 2007
and a close look into the available version indicates that Maharashtra tops
the entire country with regard to the suicide of distressed farmers.
According to the website, 16,632 farmers ended their lives in 2007 and
Maharashtra had the highest figure of 4,238 of whom 1,520 are reported from
Vidarbha region alone.
As a matter of fact, the Central government has granted a huge sum of Rs
3,750 crore in the form of the Prime Minister’s Special Package and the
state government granted Rs 1,075 crore as Chief Minister’s package for the
rehabilitation of the distressed farmers of Vidarbha. Now the billion dollar
question is: Where had the fund from the special packages gone? And who is
still responsible for unabated suicide?
A leading farm activist Kishor Tiwari, speaking to TOI, said that on an
average 4,000 farmers committed suicide in last four years and 70% of these
suicides have been reported from Vidarbha region alone.
While ridiculing the tall claim of the state government about the fall in
suicides after the implementation of the special packages, the information
of suicide figure given by a government agency ―Vasantrao Naik Swawalamban
Mission ― shows an upward trend (in six worst-hit Vidarbha districts) in
2008 than in 2007 and the suicide figure from 2001 till December 10, 2008 is
5,142.
The government has constituted eight inquiry commissions/committees since
2004 and the reports have also been submitted from time to time. According
to these reports, over 10 lakh farmers are distressed. Over one lakh
families are deprived of proper health care facilities while 3.60 lakh
families are facing the financial burden to meet the expenditure of their
daughters’ marriage. Over 80% farmers, who are denied of the bank loan being
defaulters, are forced to knock on the doors of the unscrupulous private
money lenders and their greedy touts for meeting their urgent financial
needs.
Tiwari urged the government to ensure “food, health and education security”
to poor farmers in the region so that they can lead a dignified life as
envisaged under the Constitution of India.
He demanded that the state should provide financial assistance to the poor
and needy farmers for their daughters’ marriage and also ensure them of the
facility for fresh crop loan at subsidised interest rate.
The Union home ministry’s website also shows an upward trend in the crime
rate across the country vis-a-vis farmers’ suicide in the state. The current
trend is that the suicide wave is speedily moving from western Vidarbha to
eastern Vidarbha districts which may take an alarming situation in the days
to come.
Tiwari further urged the chief minister Ashok Chavan to look into the matter
seriously and come out with an effective action plan to curb it during the
current winter session of the State Legislative Assembly in Nagpur.

Increased indebtedness leads to farmer suicides: NCEUS

http://www.financialexpress.com/news/increased-indebtedness-leads-to-farmer-suicides-nceus/401178/0

New Delhi, Dec 21 : The consumption expenditure of marginal and small farmers exceeds their estimated income by a substantial margin and presumably the deficits have to be plugged by borrowing or other means.

Increased indebtedness is a major cause for the spurt in farmers’ suicides during recent times across a number of states, according a recent report of the National Commission for Enterprises in the Unorganised Sector (NCEUS).

A marginal farmer is defined as one having landholding less than 2.5 acre and a small farmer is defined as one having less than 5 acre.

In India, a majority of the farmers are marginal and small. The NCEUS headed by noted economist, Arjun Sengupta has recommended a Rs 5,000 crore special programme for marginal and small farmers with a view to insulate them from the adverse impact of the global financial crisis.

The average monthly income of all farmers is estimated at Rs 2,115. This monthly income ranges from Rs 1,659 for marginal farmers to Rs 9,667 for large farmers.

Poverty and social identity are co-related as in the case of scheduled castes and tribes, backward castes and Muslims.

The NCEUS report noted that many states including Punjab, Andhra Pradesh, Karnataka, Maharashtra and Kerala have recorded a spurt in distress driven suicides among farmers. In most, if not all such cases, the economic status of the suicide victim was very poor, being small and marginal farmers.

After the green revolution, agricultural activities have become cash-based individual enterprises requiring highinvestment in modern inputs and wage labour as is evident from the list of states withhigh incidence of farmers’suicides, which are not necessarily backward or predominantly agrarian or with low income, according to the NCEUS report.

“Increased liberalisation and globalisation have in fact led to a shift in the cropping pattern from staple crop to cash crops like oilseeds and cotton, requiring high investment in modern inputs and wage labour. This increases credit needs. But when the prices declined farmers have no means to supplement their incomes,” the NCEUS report noted.

Another problem is that unlike industrialists, farmers do not have access to debt relief under any law. Being indebted to the private moneylenders, they cannot go to public authorities to declare themselves insolvent or to get any kind of debt relief.

According the Situation Assessment Survey of Farmers-2003 about 48% farmer households had loans outstanding in 2002-03.

Incidence of indebtedness among farmer households was highest in Andhra Pradesh (82%), followed by Tamil Nadu (75%) and Punjab (65%). The NCEUS has therefore recommended wider coverage of farmers by institutional credit, with cheaper loans.

Stimulus for agriculture;A bailout for farming?

By Devinder Sharma

The serial death dance in the countryside continues, with an estimated 1,82,936 farmers commiting suicide since 1997.

Buried under the whole array of angry reactions following the Mumbai terror is yet another and perhaps more violent disaster. A startling piece of news that should have shaken up the country’s screaming elite has not even been perceived by the electronic media as worthy of being dubbed as breaking news. That 16,632 farmers had committed suicide in 2007, with Maharashtra topping the list, has simply been ignored.
The reason is obvious. They did not belong to the Taj-is-my-second-home class.
While the serial death dance in the countryside continues unabated, with an estimated 1,82,936 farmers as per the National Crime Records Bureau (NCRB) taking the fatal route since 1997 to escape the humiliation that comes along with growing indebtedness, the government is on a bailout spree. Since September, the government has provided a fiscal stimulus of US $ 100 billion by way of liquidity and other budgetary provisions. Another stimulus package is awaited.

The stimulus package has so far gone to sectors that erred. The proposed interest sops to housing loans of Rs 20 lakh is one such economic misadventure. By forcing banks to reduce interest rates on housing so as to create more demand is completely unwarranted. Why should the government even consider a bailout for people who can afford to pay an EMI of Rs 25,000 a month? Why should the government bail out the real estate sector which has fleeced the society? In the past four years, the prices of flats have risen by an estimated 450 per cent.

Indian banks needed liquidity inflow to jumpstart the economy. That is what we were made to believe. The Reserve Bank of India moved in swiftly. Through a series of measures, including a cut in repo rate, opening a special lending facility for the banks, and cutting cash reserve ratio, RBI has pumped Rs 3,00,000 crore into the banking system since mid-September. And look, what happened. The banks are putting the money back with RBI as safe deposits. Between December 1-8, (in just eight days), banks have deposited Rs 327,000 crore back with RBI at a nominal interest of six per cent, which was further lowered to five per cent.

The fiscal stimulus is expected to control the economic slump to some extent. In effect, the guiding principle appears to appease different lobby groups keeping an eye on the forthcoming elections. Exporters, for instance, have twice received a stimulus package. First when the rupee/dollar exchange rate had slumped to 37 per dollar, the textile and garment exporters had pitched for higher support. The government had moved in swiftly pumping in over Rs 1400 crore. Now when the exchange rate is closer to 50, the industry has again managed a second dose.
Not to be left behind, Indian cotton ginners and exporters are also demanding a bailout. They want the government to bridge the difference between a higher minimum support price for cotton, and the world prices. Citing a 95 per cent drop in exports, the industry is demanding a rescue package. Wonder when the MSP was low and the international prices were higher, and why the industry never asked the government to compensate the cotton farmers.
Amidst all the gloom, the only sector that has emerged unscathed to a large extent is agriculture. Whether India was shining or sinking, agriculture truly remained the mainstay of the economy. Complete apathy and neglect of the farm sector drove farmers to commit suicide, and also to quit farming. Facilitating the demise of agriculture are the government policies that are now forcibly enforcing land acquisition, and bringing in polices for corporate takeover.
With 60 per cent of India’s population are directly engaged in agriculture, and another 200 million landless workers indirectly bank on farming, the real stimulus to economy can come only if the focus shifts to agriculture. When I say agriculture, I don’t mean a bailout package for the tractor industry or the food processing industry. This would be counter-productive. Nor would it be cost effective.
What is urgently needed is a radical shift by stimulating the farm sector. This is a sure recipe for revitalising the economy. First, the package should be for regenerating agriculture, providing sops for organic farming systems that can restore soil health. The Rs 1.20 lakh crore fertiliser subsidy should be given directly to farmers so that they can make an informed choice of shifting to natural farming systems. And finally, the package should focus on farmers’ welfare. A fixed monthly income based on the principle of direct income support is what the beleaguered farming community needs.
In addition, the National Rural Employment Guarantee Act 2005 (NREGA), which guarantees a minimum 100 days employment every year to rural workers and promises a minimum wage of Rs 60 per day, should have the upper cap of 100 days immediately removed. Rural workers need to be given employment for 365 days, like all of us in the organised sector. This in turn will generate demand that is expected to kick-start the economy. At the same time, there is an urgent need to link NREGA with agriculture. This is the recipe for all around growth. And not only limited to those who consider the Mumbai Taj to be the national icon.

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SEZs left high and dry, need succor

Story Courtesy Business Standard

NEW DELHI: Scores of SEZ developers are seeking to get themselves ‘de-notified’ or cut to size for want of investor confidence. A senior Union Commerce official who asked not to be named confirmed to ET last week the trend and attributed the same to the economic slowdown the provenance of which is failed US financial markets. 
DLF has already got the ‘final approval’ for their IT SEZ near Delhi repealed and many others who have obtained such approvals are anxious to toe the line. While at least few developers want their SEZ tags (and attendant tax benefits) to go in order to be able to make their businesses doable through utilisation of the real estate they had acquired, most others are seeking to cut themselves to rational size without flouting the minimum processing area norm. 
Obviously, near standstill in the credit market and the pervasive demand crunch (the latter causes the former to persist even as partly resulting from it), has forced the developers to plead inability to get enough firms to buy SEZ slots. The viability of many SEZs, which are being developed/about to be developed is in doubt. But that should not convince one to mindlessly buy the argument that these SEZs are in trouble purely due to the economic slowdown, which the developers claim they did not anticipate to be one of such gravity. 
The fact is the (inter-ministerial) board of approval for SEZs has, right from the start, adopted a very liberal policy towards grant of SEZ approvals. The logic was that if you give quite a lot of approvals, even if some projects eventually fail to materialise, you would end up with a decent number of SEZs and even if some of these tend to see real estate as the principal revenue stream, a good many of them would still be sufficiently doing other economic activities like manufacturing to boost GDP and produce lakhs of new jobs. 
The policymakers professedly believed that the 1:1 ratio for earmarking processing and non-processing areas, other cautionary norms and the oversight by the development commissioners would minimise the possibility of malpractice. The current rush for cancellation of SEZ status shows that the board of approval for SEZs could have been more circumspect in granting approvals. 
The SEZ Act, as of now, does not allow de-notification. But one can get the approval cancelled even after the ‘final approval’ is obtained, which is usually after acquisition of land. So the flurry of applications for shedding the SEZ tag that is now being witnessed is actually about cancellation of final approvals or cutting the processing area without violating the notified norm in this regard. That nevertheless clearly demonstrates the growing diffidence within the (potential) developer- community with regard to the viability/business sense of these tax-free zones.

Some would argue that none of Indian SEZs would have the size of those in China which are large, multi-product industrial townships with huge cost benefits, including those on input taxes. In fact, of 530-odd formal approvals (which include about 265 SEZs notified) given so far, only a few are for multi-product zones. Majority of the approved SEZs are IT SEZs, with minimum area of just 10 hectares. 
There are also questions about the economic and moral tenability of the SEZ model. The states are now disallowed to acquire land on behalf of the SEZ developers. However, the fact is many states did involve themselves in land acquisition for SEZs at the initial stage that makes the demand for permission to sell such land—which is what the so-called applications for ‘de-notification’ are all about—dubious. 
The schism at the policy-making level continues to be visible even though the row over ‘compulsory land acquisition’ has been more or less resolved. For example, the Kerala government has recently come out with certain additional ‘state-specific safeguards’ including an increase in processing area to 70% of total SEZ area. 
Leaving aside the dispute over whether to have SEZs or not, the reality is now that hundreds of SEZs, although most of tiny sizes, are being developed in the country. One estimate is that a sum of Rs 1,00,000 crore has already been invested in this sector. At this juncture, the government policies would need to coherent enough to make best use of these investments for the benefit of the economy. 
Unfortunately, various policies are at odds with even the legitimate plans of SEZ developers. Since the RBI refuses to classify SEZs as infrastructure ventures (the central bank believes SEZs are real estate projects), SEZ projects have the high-risk tag. This has made raising funds nearly impossible for them, especially in the current situation of a general credit squeeze. 
Since SEZs are not allowed to sell lands (unless they get part of the acquired land de-notified), the potential lenders remain doubly sceptical about the creditworthiness of the many SEZ developers. This because in case of default, few options are available to the lender to recover the funds. 
Also, the ECB policy, despite the recent liberalisation, continues to militate against SEZs as `real estate projects’ (which is what SEZs are, according to RBI) are not among the prescribed end uses for ECB funds. 
So, scores of SEZ developers are left high and dry. They are sitting on land banks without the funds needed to develop them and attract investors. At a time the government is trying to revive the slowing economy through fiscal stimuli, this doubtless represents a policy dichotomy.

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Maharashtra to announce Rs 5,000 cr farm loan waiver

http://www.business-standard.com/india/news/maharashtra-to-announce-rs-5000-cr-farm-loan-waiver/00/36/344103/

Makarand Gadgil / Mumbai December 23, 2008, 0:27 IST

With the Lok Sabha elections around the corner, the Maharashtra government is set to announce another farm loan waiver package to cover all those who were excluded by the central government’s waiver package. The latest package is likely to cost between Rs 5,000 crore and Rs 7,000 crore, and benefit 2.7 million farmers. A senior minister in the state cabinet said: “During the monsoon session of the state Assembly, the government had promised a loan waiver package for those not covered by the central government’s Rs 71,000 crore loan waiver scheme. We will be announcing this during the winter session.” However, he refused to divulge the details of the loan waiver package.

The discussion on the Opposition sponsored debate on agriculture distress in the state began today and Chief Minister Ashok Chavan is expected to reply to the discussion on Tuesday. In the course of his reply, he is likely to announce the package, sources said. The high number of farmer suicides from the six cotton growing districts of the Vidarbha region was one of the major reasons that compelled the central government to announce the loan waiver package. However, majority of the farmers from Vidarbha got no benefit from the package as it was given to farmers having less than 5 acres or 2 hectares of land.

Traditionally, Vidarbha has a higher number of landholdings compared with the Western Maharashtra or Konkan regions. Since Vidarbha’s farming is mostly dryland farming, landholding remained large even after the implementation of the Land Ceiling Act. According to the government’s own estimates, out of the 4.5 million farmers in Vidarbha, only 40 per cent received the benefit of farm loan waiver package.

Taking advantage of the resentment among the Vidarbha farmers, Opposition parties Shiv Sena and BJP had organised protests over the last six months, demanding that all farmers should be given benefit of the loan waiver.

The government was put on the back foot by the aggressive posturing of the Opposition.

Many farmers who had paid their dues by taking loans from money lenders or by selling ornaments, were also feeling cheated. “There was a feeling among them that if you default on your loan, instead of punishing you, the government rewards you. So it was necessary that these farmers also get some benefit of their honesty,” said a senior government official.

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1,232 farmers committed suicide in MP

http://www.centralchronicle.com/20081217/1712101.htm

Bhopal, Dec 16: Though Maharashtra has once against toped the list of suicides by farmers in the country with the state recording 4,238 such cases last year, the situation in Madhya Pradesh on this front is also turning out to be grim with the state recording 1,232 cases of suicides by farmers last year, as per the latest report of the National Crimes Record Bureau.

In terms of suicides by farmers in the country, Madhya Pradesh ranks fifth. The states which are ahead of Madhya Pradesh in this regard include Maharashtra (4,238), Karnataka (2,135), Andhra Pradesh (1,797) and Chhattisgarh with 1,593 cases of suicides by farmers. However, if the figures of Madhya Pradesh and Chhatisgarh are clubbed together, the total number of suicide cases by farmers in both these states will only be next to Maharashtra.

A study by the Madras Institute of Development Studies (MIDS), as quoted in The Hindu last year, also puts the number of farmer suicides in the two states at well over 2,000 a year from 1997 onwards when the Institute began documenting suicide figures. According to its data, 2,390 farmers committed suicide in the two states in 1997; 2,278 in 1998; 2,654 in 1999; 2,660 in 2000; 2,824 in 2001; 2,578 in 2002; 2,511 in 2003; 3,033 in 2004; and 2,660 in 2005 respectively.

On the other hand, the state has ranked third in terms of statistics of family members committing suicides jointly under a common suicide pact. As per the National Crimes Records Bureau report, out of 264 deaths (which included 118 males and 146 females) reported under this category last year, Madhya Pradesh ranked third with a total of 12 persons committing suicides under a common pact. In this category, Kerala attained top position with 39 such cases followed by Andhra Pradesh (34).

Among 35 Indian cities, Bhopal has turned out to be family suicide capital of the country from where the highest number family suicides (8) were reported. It was followed by Surat (6) and Rajkot with 5 family suicide cases respectively. The suicide rate in cities (13.3) was higher as compared to All-India suicide rate (10.8). As per the NCRB report, while Bangalore and Chennai recorded the highest suicide rates of 42.7 and 36 respectively, the same was found to be the lowest in Indore (the commercial capital of Madhya Pradesh) and Kolkata with the suicide rates of 2.0 and 1.5 respectively.

As far as reasons of suicides in Indian cities are concerned, Allahabad has taken the lead with almost 50% of the people committing suicide due to family reasons. It was followed by Indore and Amritsar with 43.8% and 42.3% of the people committing suicides for the same reasons. `Dowry dispute’ took lives of 37.5% of suicide victims in Indore. Of total suicides in Indore, 56.3% suicides were committed by house wives, while 68.8% of the victims committed suicides by consuming insecticides.

In Bhopal, `death of a dear person’ drove 8.3% victims towards suicide, while 11.4% suicide victims were engaged in farming/agriculture activity.

Krishna K Jha

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