Subject: Vandana Shiva's "The Poor Can Buy Barbie Dolls" 
	 - from Diverse Women for Diversity
    DWD: Vandana Shiva, the fate of the poor, quantitative restrictions


                       THE POOR CAN BUY BARBIE DOLLS

                  Removal of QRs and the fate of the poor
                            by Dr. Vandana Shiva
                                2 April 2001


     When the French peasantry was reeling under a severe famine and
     Marie-Antoinette was told that they had no bread to eat, she
     nonchalantly said, "If there is no bread, let them eat cake".

     When thousands of our farmers are committing suicide, when
     millions of our women and children are facing hunger and
     starvation, a leading economist said that, "The poor can buy
     Barbie dolls". This statement was made when I was on a T.V. panel
     with him to discuss and debate the impact of the removal of import
     restrictions (Quantitative Restrictions or QRs)

     We were discussing the disastrous impacts of free flow of products
     into Indian markets on small-scale producers and farmers. A video
     clip had been shown of the 100,000 lock makers in Aligarh whose
     units were being shut down as cheap locks from China were flooding
     our markets. Import of agricultural commodities like edible oils
     have already destabilised the agricultural economy and with 147
     more agricultural items removed from the restricted list, other
     sectors will be hit.

     The removal of QRs has been celebrated by the media as a consumers
     bonanza. Sample one of the headlines -- "Johnie Walker, fine wines
     in 2 weeks", "The consumer bonanza", "The Indian consumer has
     finally been crowned king", "The brand India will be wearing
     Overcoat -- Dolce & Gabbana, Scarves -- Hermes, Belt -- Calvin
     Klein, Skirt -- Margaretha Ley Escada, Pullover -- Chloe, Diamond
     Necklace -- Van Clef and Arpels".

     The diamond laden lady is not the typical Indian consumer. Most
     Indian consumers are already consuming less than their basic needs
     require as livelihoods are destroyed, incomes disappear and
     purchasing power evaporates. Cereal consumption has declined by
     12% in rural India during a decade of reforms. As imports further
     destroy livelihoods, especially of the poor, their consumption
     levels will further fall. No one is addressing the declining
     consumption of the poor as imported goods drive out domestic
     production and livelihoods. And when the issue of survival of the
     poor was raised, our worthy economist stated seriously, "the poor
     can buy Barbie Dolls".

     It is this mindset of elite India, blind to the growing hunger and
     destitution of the people of this country but enthralled by the
     junk that can now be imported, which is fooling the country about
     the reason and impact of lifting QRs. Among the unrestricted
     imports are carcasses of sheep and goats, offal (animal waste
     parts) of chicken, sheep, turkeys, ducks, geese, rabbits, hares,
     swine.

     We have opened up our markets to meat imports when Europe is in
     crisis because of Mad Cow Disease and the Food and Mouth Disease.
     More than 500,000 animals are being killed and burned.

     The U.S. Centres for Disease and Prevention (CDC) in Atlanta has
     calculated that nearly 81 million cases of food borne illnesses
     occurs in the US every year. Deaths from food poisoning have more
     than quadrupled due to deregulation, rising from 2,000 in 1984 to
     9,000 in 1994. Most of these infections are caused by factory
     farmed meat. CDC estimates there are nearly 20,000 cases of
     poisoning by the mutant E. Coli 0157.H7. This mutant bacterium was
     unknown before 1982 and contamination of meat by E. Coli 0157.H7
     results from sloppy high-speed slaughter and processing industry.

     The so called Hazard Analysis Critical points (HACCP) is in
     reality a Trojan Horse for deregulation which has resulted in
     removing 1400 food inspectors and leaving food safety in the hands
     of the factory farming industry which produces food hazards in its
     rush to slaughter more animals faster. A few high-speed slaughter
     operations have driven out thousands of small packers out of
     business.

     The US slaughters 93 million pigs, thirty seven million cattle,
     two million calves, six million horses, goats and sheep and eight
     billion chickens and turkeys.

     Now the giant meat industry of US including the disreputed meat
     giant Tyson, wants to dump contaminated meat produced through
     violent and cruel methods on India, a predominately vegetarian
     society.

     Fewer employees were slaughtering more animals and the worker
     turnover rate in high-speed plants is nearly 100 per cent per year
     according to the United Food and Commercial International Union.
     Workers in America's slaughterhouses call working in the meat
     industry worse than slavery.

     Factory farms and slaughter houses are prisons for animals and
     humans. Article XX of the GATT allows the exemption of WTO rules
     relating to prison labour (Article XX (e)). On grounds related to
     products of prison labour the removal of restrictions on imports
     from the US should be immediately stopped.

     The Government's announcement that the Prevention of Food
     Adulteration Act will be used to ensure "Biosecurity" under free
     import conditions is far from reassuring. PFA is an outmoded food
     law, designed before the age of Mad Cows, prions and GMOs. The
     Government has so far failed to pass a law drafted by the Social
     Welfare Ministry for labelling of vegetarian and non-vegetarian
     content in food items. It has not shown the will to protect public
     health or the citizens right to know. It cannot guarantee food
     safety in the face of imports through the instruments it has
     offered. The "Licence raj" has not ended. Our public health is
     being put in the hands of corrupt inspectors who will give
     licenses for the import of the most hazardous food stuffs without
     blinking an eyelid. Article XX allows for bans on imports and this
     is the route that should be used for agricultural products that
     carry risks for animal or human health.

     The Government has also announced that it will import sensitive
     items through State Trading Agencies. However, soya oil and palm
     oil which are already flooding our markets are not on the list of
     canalised imports. Further, while the bound rate for tariffs on
     edible oil imports is 300%, the government has kept the tariff for
     soya oil. This does not benefit the Indian farmer but the seed
     giant Monsanto and the grain giant Cargill abnormally low at 45%.
     The announcement of a "war room" might reassure some people. But
     such militaristic metaphors could only emerge from thinking which
     sees economics and trade as war. Tragically, the EXIM policy has
     declared a war against the hard-working people of India, but the
     "war room" will fail to see the victims of this war, as millions
     are pushed into hunger and destitution. The problem with the free
     trade logic is that it puts trade above people's lives and shifts
     government focus from the welfare of people to the promotion of
     exports and imports. The EXIM policy makes this singular focus
     that neglects people but protects trade very evident. The
     destruction of the economy of a billion people is being destroyed
     with a pathetic target of exports by 2005 accounting for 1% of
     global trade.

     In any case, the rush to remove QRs is not justified. India's
     trading partners had accepted the deadline of 2003. Only the U.S.
     had called for removal of QRs by 2001. In Oct 1997, the United
     States initiated action at the WTO Dispute Settlement Body ("DSB")
     to establish a Panel to examine this dispute. In its request, the
     United States considered that quantitative restrictions maintained
     by India, including but not limited to, the more than 2,700
     agricultural and industrial product tariff lines notified to the
     WTO in Annex I, Part B of WT/BOP/N/24 dated 22 May 1997, appeared
     to be inconsistent with India's obligations under Articles XI:1
     and XVIII:11 of GATT 1994 and Article 4.2 of the Agreement on
     Agriculture. Furthermore, its contention was that the import
     licensing procedures and practices of the Government of India were
     inconsistent with fundamental WTO requirements as provided in
     Article XIII of GATT 1994 and Article 3 of the Agreement of Import
     Licensing Procedures.

     The DSB established the Panel on 18 November, 1997, with the
     following terms of reference:

          To examine in light of the relevant provisions of the
          covered agreements cited by the United States in
          WT/DS90/8, the matter referred to the DSB by the United
          States in the document and to make such findings as will
          assist the DSB in making the recommendations or in
          giving the rulings provided for in those agreements.

     In other words, the US demanded a much shorter phase-out period
     for the removal of Quantitative Restrictions.

     In April 1999, the WTO Panel ruled in favour of the US. The Panel
     chose to only take in to account the IMF position that India's
     balance-of-payments situation was not such as to allow maintenance
     of measures such as QRs for BOP purposes and therefore India was
     not justified in maintaining its existing measures on the pretext
     of BOP problems.

     The Government of India at this stage did not raise any arguments
     by way of exerting its rights as a founding member of the WTO,
     premised on the probable recurrence of BOP problems due to
     increase in imports.

     The Panel asked the parties to negotiate a new
     implementation/phase-out period. The Panel also recommended that
     DSB ask India to bring the measures at issue into conformity with
     its obligations under the WTO Agreement.

     In May 1999, India notified the DSB of its decision to appeal
     against certain issues of law in the Panel Report and filed a
     notice of Appeal with the WTO Appellate Body.

     In August 1999, the Appellate Body rejected India's appeal. Among
     other things the Appellate Body upheld the Panel's finding that it
     was competent to review the justification of India's
     balance-of-payments restrictions under Article XVIII:B of the GATT
     1994.

     In September 1999, the Indian Government indicated to the US that
     it required more than the normal 15-month period to remove QRs.
     However, the latter did not agree to this time schedule, though
     all other trading partners did.

     In December 1999, by the exchange of letters between two trade
     bureaucrats, Susan Esserman of the US Commerce Department and N.N.
     Khanna of the Indian Ministry of Commerce, an agreement between
     the two governments was executed to the effect that:

       a. on or before April 1, 2000 India may notify to the United
          States a listing of up to but no more than 715 items of the
          1,429 items on which India currently maintains quantitative
          restrictions, and with respect to the up-to-715 items so
          notified, the reasonable period of time shall expire on April
          1, 2001 and

       b. with respect in all the other items, the reasonable period of
          time shall expire on April 1, 2000.

     This agreement in effect drastically shortened the phase-out
     period to 2001 by which date all QRs on 1,429 items would be
     lifted. This is despite the fact that the European Union and other
     countries had agreed to a phasing out of import restrictions by
     March 2003. But the Indian Government, bowing to pressure from the
     US, advanced the lifting of QRs by three years.

     However, the U.S. is itself violating international obligations
     such as backing off the Kyoto Protocol to regulate CO2 emissions
     though it is the biggest polluter. Responsibility is a two-way
     lane. And the lack of responsibility being shown by the U.S. in
     respecting international commitments should have been used by
     India to gain space in setting policy that ensures her people's
     survival. In any case, India is arguing for maintaining QRs in the
     review of the Agreement on Agriculture. It should have maintained
     QRs as a right.

     It is also arguing for a livelihood and food security exemption
     from the rules of the Agreement on Agriculture. Instead of
     defending the livelihoods and food security of the country, the
     Commerce Minister has threatened the survival of the Indian
     people, especially the farmers twice over -- firstly, through
     removing restrictions on imports and secondly by announcing an
     agribusiness centered export oriented policy for agriculture. This
     "farm-to-port" export policy is a recipe for corporatisation of
     Indian agriculture. It will undermine our food security. Farmers
     loose markets by imports of artificially cheap products due to
     removal of QRs. They will loose their land, their water, their
     homes as corporations take over Indian agriculture to grow flowers
     and vegetables and fruits and shrimps for exports, with state
     support.

     The Commerce Minister has through his EXIM policy committed
     India's markets, soil and water as public subsidies to global
     corporations.

     Barbie dolls might flood super market shelves soon, but how will
     the poor be fed if they have no livelihoods? How will farmers
     survive when both markets and resources have been snatched away
     from them?



     Vandana Shiva <vshiva@giasdl01.vsnl.net.in>