US-India “deal” undermines food security and is victory for TNCs

14 နိုဝင်ဘာလ 2014
Press release

Netherlands/Jakarta, 14 November 2014 - The announcement on November 13th of a US-India agreement on trade facilitation and India’s food security programme was denounced today by Transnational Institute and Serikat Petani Indonesia (SPI), the Indonesian Peasant Union Federation as a “victory for transnational corporations at the expense of peasant farmers.”

The agreement in the first place only promises to hasten the work towards a permanent solution – this was already an existing promise from the Bali Package. And yet in return, India has agreed to end its blockade of Trade Facilitation Agreement (TFA), which, now unblocked, will move towards ratification and eventual legal adoption into the legal framework of the WTO. 

SPI and TNI argued that rather than focusing on whether India ‘caved’ or US ‘compromised,’ the real winners were not states but the transnational companies that have long pushed for the Trade Facilitation Agreement and will be the main beneficiaries of any deal. According to a report released by TNI and SPI this month,  Big Corporations, the Bali Package and Beyond: Deepening TNCs gains from the WTO transnational Corporations have been lobbying to secure the TFA for more than 20 years.  

"In the present era of global supply chains, it will be the TNCs and their subsidiaries whose businesses are based in developing countries, where labor is cheaper, that truly benefit from this agreement, says researcher and trade analyst Mary Lou Malig. “Meanwhile it will cost developing countries to implement the demanded changes while reinforcing a global trade model that destroys jobs and undermines the rights of workers and small-scale farmers.”

The details of the US-India agreement on food security are not fully available, but reports suggest it has postponed any possible legal action against India’s public stockholding of food until at least 2017 or until a permanent solution is found to US and Europe’s opposition to India’s food security programmes. It is unclear what is new with this deal as this holding off on legal action or “peace clause” was something already promised in the Bali Package and is a far cry from the original demand of developing countries to amend the Agreement on Agriculture to allow for food security programs to support small farmers and poor constituencies in those developing countries.  

Mary Lou Malig denounced the decision as putting the “unacceptable on hold” and perpetuating a deeply immoral attempt to undermine the right to food. “How can it be up to either the US, Europe or the WTO to decide whether countries can guarantee the right to food for their people. The right to food is a fundamental human right that should not be subject to trade rules." Malig also denounced the continuing hypocrisy of countries in the North that subsidise their industrialised agriculture while undermining protections for small peasant farmers in the South and small and family farms in the North.

TNI’s report, Big Corporations, the Bali Package and Beyond explores the details of the Trade Facilitation Agreement and exposes the transnational corporations that lobbied for the deal and will now reap the benefits. It also analyses the ‘peace clause’ related to food security that was part of the agreement at the December 2013 Bali Ministerial, after years of stalemate in multilateral trade negotiations. In addition, it shows how the TFA will be enforced through WTO Dispute Settlement Mechanism (DSM). This fits a pattern, where the World Trade Organization (WTO) and its legal system increasingly play a role in protecting Transnational Corporations’ rights, while special and differential treatment and concerns of Least Developed Countries (LDCs) are relegated to declarations and promises for future action.

“The India-US agreement, and the underlying Bali deal that it endorses, shows once again that the trade system and the World Trade Organisation are bodies run for the interests of transnational corporations rather than people,” said Mary Lou Malig. “Just as millions are standing up against unjust trade deals such as the EU-US Transatlantic Trade and Investment Partnership (TTIP), we all need to join forces to oppose the WTO and demand trade for people not for profits.”

Photo credit: CGIAR/flickr