The supply of subsidised food to the poor has been preserved – despite pressure

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”Mr Modi . . . has effectively torpedoed the WTO’s Bali deal this week, in an emphatic debut on the world stage that has left trade specialists and business executives both fuming and confused” writes Amy Kasmin in the Financial Times. The dna daily broadsheet quotes Devinder Sharma,“It is America and EU who will lose. They are looking for big markets”.

India’s new government has refused to back the current WTO deal unless it is linked directly to negotiations over updating WTO rules that apply to its programme for supplying subsidised food to the poor and supporting traditional staple crops. As the Economic Times points out, “Food security is critical for India: With half the population engaged in agriculture & more than 300m people below the poverty line, this is an issue central to the wellbeing of vast numbers of Indians . . . Food subsidies in developed world are bigger: India’s support to farmers through the minimum support price (MSP) is only about $12b, well below what the US or other countries provide”. 

narendra modiThe Times of India reports: “In the clearest articulation of India’s position on the WTO standoff, from the highest level, PM Narendra Modi on Friday forcefully told visiting US secretary of state Hohn Kerry that the first responsibility of his government was to the poorest people of the country”.

Corporate interests, affronted by Narendra Modi’s principled decision to place the interests of millions of underprivileged Indians above those of the wealthy elite, are subtly undermining him.

“What do we gain from this – nothing,” said Surjit Bhalla, a New Delhi-based economist. Business groups said they were concerned about missing out on potential benefits to India and its industries, of the trade facilitation deal.

Provincial? 

Rajiv Kumar, a senior fellow at New Delhi’s Centre for Policy Research, wrote this week that India’s “splendid isolation at the WTO” reflected poor advice to a politician still changing from provincial satrap – mainly concerned with infrastructure and industrial build-out – to national leader, navigating a complex international environment.

Allegation: Modi’s action due to concern for media image

One analyst, who asked not to be identified, suggested that in blocking the deal the prime minister was less concerned with India’s national interest than his own: “Modi is obsessed with his public persona and was concerned that this could have been portrayed in the media as having buckled to foreign pressure and sold out the little people. It would have taken the shine (out of) what is still his honeymoon period.”

On the other hand, Shaurya Doval, director of the Indian Foundation, a man of standing in the country’s business circles, says, “It is a well thought out and well calibrated decision, with India willing to take the consequences.The world may disagree, but India has protected its interests as it has thought them to be.”

gujarat solar canal

Mr Modi has indeed shown signs of caring for the ‘little people’, promising to provide country-wide sanitation during his time in office. Already during his tenure, the Gujarat government has provided a 24 hour power supply to 18,000 villages – not only using coal but developing solar and wind energy. An innovative solar canal project now generates clean energy without encroaching on fertile land and prevents evaporation of 9 million litres of water annually from the canal.

One commentator summarises: “Narendra Modi is not perfect, but it is better for people to compare him to others . . . who don’t do anything but feed their own families with public money”.

  

Sources include:

http://www.ft.com/cms/s/0/15040d08-18fb-11e4-80da-00144feabdc0.html#ixzz39IgFyWOT
http://www.ft.com/cms/s/0/c67cfc5a-197f-11e4-9745-00144feabdc0.html#ixzz39IhPgacv
http://www.indiamainly.com/politics/note-to-congress-%E2%86%92-forget-the-state-of-gujarat/
http://motherboard.vice.com/read/indias-ingenious-plan-to-cover-1000-miles-of-canals-with-solar-power-plants
http://economictimes.indiatimes.com/news/economy/foreign-trade/wto-deal-failure-valid-reasons-why-pm-narendra-modis-government-refused-to-yield/articleshow/39471767.cms
http://www.ndtv.com/elections/article/election-2014/election-results-2014-narendra-modi-wins-india-bjp-and-allies-cross-300-seats-525481
http://www.dnaindia.com/india/report-india-stands-tough-in-face-of-wto-pressure-2007216
 
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