Kerala Chief Minister V S Achuthanandan says the views of state governments affected by the proposed Afree trade agreement with the Asean group of countries were not taken before the Centre decided to sign it. And state agriculture activists have asked MPs from Kerala to resign if the pact is signed, as a mark of their failure to represent the state’s interests.
In a letter to Prime Minister Manmohan Singh, the CM says ”it is a matter of serious concern that the views of the affected state governments were not taken into account while formulating a trade pact of this magnitude.’’
The opening line of the letter to the PM yesterday says: “ The state government has learnt from the media that the central government has decided to sign the much debated and widely criticised Asean trade agreement (which) has a number of provisions having far-reaching adverse impact on Kerala’s agricultural economy.” The decision to sign, he adds, comes even as the already liberalised import regime has distorted the market prospects of domestic coconut oil, pepper, etc.
When the decision came up before the Union cabinet last week, it was opposed within the government by ministers Jairam Ramesh, Vayalar Ravi and A K Antony, all from the state. While a delegation of Congressmen from Kerala led by legislative leader Oommen Chandy had also visited the Prime Minister to convey their opposition.
The matter has been sent to a Group of Ministers to assess the impact on Kerala’s growers. The letter further says the agreement will pave way for liberalised import of rubber, tea, pepper and edible oils. With liberalised imports, the prices of these are bound to crash, says the CM.
He also expresses concern about the import of sea food, saying it will throw more than a million people out of jobs in the fishery sector.
Agriculture groups say the Kerala government was justified in feeling left out of the consultation process on the FTA. Says R Sridhar, who helped draft the Paddy Act and is in a non-government working group on trade: “We would urge our MPs to resign from Parliament, if they are unable to protect the interests of Kerala’s farmers. He says that if farmers and local governments are not in control in determining the prices in the market, then farmers are going to be ruined and cash crop production would come to an end, as it would be a loss-making proposition.”
He says Kerala’s food security has already been compromised by a massive shift to cash crops, with 70 per cent of paddy lands now not recoverable. And denies that a negative list could provide protection to major cash crops in the state. The list will take the import duty to zero over a period of 10 years but after that there is nothing to protect the farmer.
Can we say rubber, tea, coffee productivity would be competitive in 10 years, he asks. “It is not possible because the conditions in which the cultivation is done is different in the Asean countries and not comparable. With the green revolution, paddy productivity could increase only by a tonne a hectare and so, with little incentives, not much can be expected from cash crops, he says.
Either don’t go for Asean or assess the impact and find means to protect the farmer. If a farmer is going to lose by the agreement, then let assessment be done as to how much should be paid to the farmer to buffer him from the loss, and how many farmers would need protection, says Sridhar.
Thomas Verghese, chairman of the Kerala State Prices Board, says it is a state subject and the Centre cannot enter into such deals, compromising the interests of the state’s farmers, without even consulting it. He says Kerala has borne the consequences of past treaties like the South Asian Free Trade Area Agreement in 2006. “If the price of a coconut was Rs 2 in 1960, it continues to be Rs 2 today. Can you show me any product whose price has remained static like this?”
He says that it is a livelihood crop for 3.5 million households and 6 billion coconuts are produced in Kerala. “Thanks to cheaply available palm oil from Malaysia and Indonesia supplied even through the subsidised public distribution system, coconut has completely lost out,’’ he says.
Similarly in the fisheries sector, most of the items covered under the agreement are those that can come from Thailand and are also produced in Kerala, thus exposing 20 lakh fishermen to risk.
He says there is no level playing ground in the matter of trade and hence equal rates cannot apply to commodities from ASEAN countries.
If pepper prodictivity is 380 kg per hectare in India, it is 1,000 kg per hectare in Vietnam and 3,000 kg per hectare in Indoniesia.
Courtesy: Business Standard