All sound relationships are based on strong pillars. The future India-US ties are expected to be based on an unexpected pillar: agriculture.
During her recent visit to India, the US Secretary of State identified agriculture as one of the strongest pillars of bilateral cooperation. She was emphatic on both countries collaborating for employing intellectual acumen and scientific effort to defeat global hunger. She felt that this could be achieved by improving crop yields and connecting farm markets. She recalled the long history of cooperation between the two countries on agriculture .
The US has always taken interest in India?s farm sector. Food imports under PL480 scheme during the fifties and sixties are examples of direct US involvement in Indian agriculture. The US and Western support were critical in financing research for developing HYV seeds. These seeds ushered in the ?green revolution? by multiplying domestic cereal output. Much of the research on HYVs was carried out at the Consultative Group on International Agricultural Research (CGIAR) Centres, where the US was a major donor.
Ms Hillary Clinton drew attention to the Cereal Systems Initiative for South Asia as a key ground for bilateral cooperation. The initiative not only involves the Indian government and USAID, but also has the CGIAR, the Bill and Melinda Gates Foundation and corporates. Both the scale and scope of the initiative are noteworthy. It targets six million farmers across South Asia for augmenting crop yields with positive outcomes for household incomes and food supplies.
Many found the US emphasis on agriculture surprising. However, this is not India-specific. It reflects the emergence of agriculture as a major policy challenge for the US in recent months. The challenge has both domestic and external aspects.
The US realises the futility of subsidising farm exports. These subsidies are counterproductive to efficient production. The latest budget proposals have tried to rationalise subsidies. Besides capping direct payments to farmers and proposing their phase out, the budget has also recommended reduction in market access support.
Rationalising subsidies is critical to Mr Obama?s plans to improve quality of public expenditure. The economic downturn and the need to discipline expenditure provide a good opportunity for slashing farm subsidies. The imperative also arises from the urgency in reviving global trade.
Rebound in global trade is the only way to get global growth moving. Pick-up in world trade is particularly critical for non-Asian markets. Asian markets have institutional architectures such as ASEAN and multiple bilateral pacts for stimulating trade-induced growth. Such symbiotic arrangements, however, are scant outside Asia.
Localisation of global trade in Asia can be avoided only by reviving multilateral trade talks. This implies kicking to life the Doha Development Agenda (DDA). The DDA can?t be revitalised without addressing core concerns of developing countries. The US and EU are widely perceived as ?villains? in this regard. They not only subsidise farm output for outcompeting developing countries, but also block market access for manufactured products from the latter.
The US has begun showing ?willingness? to lend a sympathetic ear to developing country concerns. It took part in the latest Cairns Group discussions along with India, China, Japan and Europe to push farm trade talks. The US budget conveys positive impressions on eliminating farm subsidies. Cooperating in agriculture with India?one of the strongest proponents of special safeguard mechanisms (SSMs) for developing countries?shows the desire to cultivate allies for removing roadblocks.
But Mr Obama has his job cut out. Rolling back farm subsidies won?t be easy. Despite tall claims, subsidies on dairy exports were recently re-introduced to save dairy products from competition. The farm state members in the US Congress have stiffly resisted the proposals to cut subsidies. Mr Obama will need to appease and assuage several constituencies before acting on his thoughts.
India shouldn?t mind the US overtures. Collaborating with the US on agriculture has benefits. Apart from progressing on crop yield and productivity, the cooperation highlights politically and economically saleable objectives of engaging the US. The issue gels well with ongoing efforts to legitimise food security. The perceived benefits would be even more if DDA takes off. It?s time to welcome Indo-US ?collective? farming.
The author is a visiting research fellow at the Institute of South Asian Studies in the National University of Singapore. These are his personal views