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PUBLIC INTEREST RESEARCH GROUP
February 1993
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Acknowledgments
We would like to thank numerous Indian and international organisations, groups and individuals whose work provided us with
valuable perspective and insights on the various issues. We especially acknowledge the liberal use of the documents of National
Working Group on Patent Laws.
To Dr. Biswajit Dhar, Fellow, Research and Information System for Non-Aligned and Developing Countries, New Delhi; Mr.
S.P. Shukla, former Secretary to Government of India; and Mr. Mark Ritchie and his colleagues at Institute for Agriculture and
Trade Policy, USA, we owe a special thanks for their guidance, support and contribution in preparation of this booklet. Thanks arc
also due to Mr. Shekhar Gurera, Cartoonist, for sharing his work.
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COMWHNITY HEALTH CF’’
CONTENTS
What is GATT?
3
GATT: In Whose Interest ?
6
The Politicsof Uruguay Round
10
Dunkel Draftand the DevelopingCountries
16
Impact on Indian Agriculture
22
Impact on Pharmaceutical Industry
29
Impacton Environment
35
Resources
40
GLOSSARY
Glossary of abbreviations, acronyms and technical words used in this booklet.
Bind
Tariffs which are frozen or fixed in GATT schedules and cannot be increased without the negotiation of
compensation elsewhere.
BOP
Balance of payments.
EEC/EC
European Economic Community, a customs union formed under the Treaty of Rome.
Free Trade Area
Similar to the customs union, but with each member-state maintaining its own individual commercial policy.
GATS
General Agreement on Trade in Services — one of theitemsontheagendaof Uruguay Round.
National Treatment Concept requiring that imported goods, once they have passed customs, be treated no less favourably than
domestically produced goods. They are not to be subject to higher internal taxes or more demanding regulations.
standards etc., than domestic goods. Developed countries are now trying to extend the application of this concept
to services, foreign suppliers (firms or individuals) and foreign capital even before they cross the border and come
into a country.
OECD
Organisation for Economic Cooperation and Development whose members are developed market economy
countries.
Sanitary and phytosanitary measures Health regulations relating, respectively, to animals and plants.
Special 301
A clause in the United States Omnibus Trade and Competitiveness Act, 1988, under which its trading partners are
threatened with ‘retaliatory’ action, if they donot amend their patent laws to suit US interests.
TRIMs
Trade-related Investment Measures — one of the items on the agenda of the Uruguay Round.
TRIPs
Trade-related Intellectual Property Rights including trade in counterfeit goods — an issue on the agenda of the
Uruguay Round.
UNCTAD
UN Conference on Trade and Development.
VER
Voluntary Export Restraint — a bilateral arrangement of dubious GATT validity in which the exporting country
undertakes to limit exports of aparticularproducttoaparticularmarket.
j
What is GATT ?
nternational trade in goods has, for more than four
decades, been conducted on the basis of a set of rules
contained in the General Agreement on Tariffs and
Trade (GATT). Set up at the end of the Second World
War.theGATTwasoriginallypartofaninstitutional
arrangement to emerge from the Bretton Woods Con
ference of 1944. Charters of the World Bank and the
International Monetary Fund (IMF) to promote mone
tary stability and provide resources for post-war recon
struction, wereestablished at the Conference. At the
same time the Conference recognised the need for
another institution, comparable to the IMF and WB, to
oversee the liberalisation of world trade. It was at that
time believed that uncontrolled and arbitrary protecti onism of the inter-waryears was responsible for the
economic chaos, leading eventually to war. It was in
this context that liberalisation of trade through a multi
lateral framework was seen as crucial in preventing
recurrence of another war.
I
The Havana Charter for setting up the ITO came in
1948, but it was not ratified by the US Congress. It saw
in a permanent structure a threat to its legislative
powers to influence the future of world trade to meet
national needs—a role that the US had set for itself in
the post-war era.
Modelled largely on the US bilateral agreements,
the GATT thus continues to this day, to be the only
multilateral forum for discussion of wade policy issues
and settlement of disputes. It is an adhoc treaty among
nations which calls upon them to negotiate reduction of
tariffs (duties) for promotion of free trade. Signatories
to the treaty arecalledcontracting parties. Although
GATT is technically a treaty, it has over the years,
assumed a commercial policy role originally planned
for ITO without incorporating thoseelements of Ha
vana Charter which called for curbing unfair business
practices, commodity agreements, largely areas of concern
to developing countries. Reduction of tariffs on trade in
manufactures was retained as the limited role of GATT.
THREE TIMES
THE HUNGER...
THREE TIMES
THE POVERTY...
THREE TIMES
THE PROFIT...
Origins
Membership
The thinking that free flow of trade is the best
chance for global prosperity and peace emerged in the
US in early 30s. It was in pursuance of this ideology that
the US entered into bilateral agreements with 29 coun
tries before the outbreak of war to bring about mutual
reduction of tariffs. The ideas of a multilateral institu
tion to oversee the world trade was embedded in the US
initiatives after the war. For the US, which had clearly
emerged as a supreme economic (and military) power,
a liberalised traderegime was indeed themechanism
for maintaining its dominant position.
Thus in 1947, when the General Agreement was
signed, it was then envisaged as the first of a number of
agreements that were tobe negotiated under the pro
posed International Trade Organisation.
Twenty-three countries, which includes India, were
the original signatories of the General Agreement.
Hundred and nine countries are members today, ac
counting for 90 percent of world trade. Majority of the
countries are from the Third World. Included among
lhemembers are former socialistcountries likeHungary, Poland, Romania. With the break-up of the Soviet
Union a number of membership applications arc in the
pipeline. Accession of new members requires a twothirds majority. No country has the power of veto. Thus
majority rule was preferred over unanimity to prevent a
situation in which accession of a new member could be
stalled by acountry withno interest in its market. But
the Agreement-docs not force any country to grant equal
3
treatment to a new member to whose induction it has not
assented. This provision (Article XXXV) was used
most extensively at the time of Japanese accession by a
number of countries to retain restrictions on imports
from Japan.
regional trade agreements are not seen as violations of
GATT principles. The implications of the world getting
divided along three trading blocks around the US, EC
and Japan as central powers are a subject debate. Fears
are now being voiced about the challenge posed by such
agreements to the very concept of multilateralism.
Principles and Operational Mechanism
Reciprocity
The key principle of theGeneral Agreement en
joins each signatory to commit itself to treat all other
signatories according to the most favoured nation (MFN)
standard. MFN clause contained in Article I of Part I is
the essence of GATT. It imposes on the contracting
parties obligation to grant each other equality of treat
ment. This means, that preferential treatment like
lowered tariffs to the product of one country has to be
extended to the like products of other countries. The
idea behind this principle was to outlaw the practice of
discrimination and retaliation characterising trade in
the interwar period. The only deviation from MFN
permitted under GATT concerns customs unions and
free trade areas. Thus European Community’s com
mon external tariff and single European Market Union;
the North American Free Trade Area pact and other
Reciprocity is the basis on which members negoti
ate tariffs. Thismeans if onecountry lowers its tariffs
on another’s exports, it can expect the other to lower its
tariffs in return. The MFN principle would then require
the same concession to be passed on to the other GATT
members, setting in motion a ‘virtuous circle’ of liber
alisation.
Although non-tariff measures like import quotas,
were in practice, the GATT recognised tariff as the sole
legal device and the only negotiable item. The reason
was that tariff, being a price-based measure was more
objective, its trade distorting effects were more trans
parent and could be relatively easily monitored.
It required, therefore, a replacement of NTBs with
tariffs, binding the tariff to fix ceilings, which then are
negotiated downwards. Non-tariff Measures such as
importquotasorquantitativerestrictionsarebanned
except in carefully defined cases. These can be used
when countries face acute BOP difficulties or to protect
their infant industries from competition with foreign
goods.
Decision-making
Plante. The Chamnooga Times
4
In contrast to the IMF and the World Bank, where
a system of weighted voting operates, in GATT the
smallestof thecountry is entitled toone vote. Voting
rules differ according to the subject under discussion.
For instance, amendment of certain provisions like
Articles I (the MFN clause) can only be passed if
unanimously agreed. Amendments on other parts
NEGOTIATION ROUNDS
Year
Ventre
Outcome
1947
Geneva
First GATT Agreement
signed
1949
1950-51
1956
1960-62
Annecy
Torquay
Geneva
Dillon
1964-67
Kennedy
1973-79
Tokyo
1986
Uruguay
Tariffs on specific
' products reduced
Cu t tariffs average by 20
percent, European community (EC) negotiated first
timeasaunit
Achieved 1/3 reduction of
barriers on manufactured
goods
Signed 11 agreements cov
ering non-tariff barriers,
subsidised exports, tropi
cal products
Agriculture included in the
agenda for the first time
along with new themes on
trade in services, protectionof intellectual prop
erty rights, and deregulationof controls over for
eign investments
become effective if these have been accepted by a twothirds majority. A two thirds majority is also essential
for grant of waiver to governments wanting to take
measures which are inconsistent with its obligations
under GATT.
The seemingly democratic structure of GATT,
however, hides the real power relations which influence
the course of negotiations. Much of the bargaining that
influences the GATT negotiations occurs between the
three powerful trading partners—the US, EC and Japan
in the meetings of the Group of Seven (G-7) industrial
countries. Views of developing countries rarely deter
mine the course of events.
Decisions during the negotiations get taken largely
through consensus, than voting, as the former allows
scope for convincing trading partners to one’s point of
view and obviates later difficulties in implementation.
The consensus decisions are arrived at in the Green
Room, a chamber where the Secretariat helps members
to iron out differences. Invitation to the Green Room is
selectively extended and negotiations are held behind
closed doors.
It is also widely believed that those outside the
Green Room get to see the draft agreements at the
eleventh hour. Thus, despite its seemingly democratic
structure GATT has, as we shall see, served as a tool in
thehands of theindustrial countries tocapture larger
shares of world trade. ■
The seemingly democratic struc
ture of GATT, however, hides the
real power relations which influ
ence the course of negotiations.
Much of thebargaining that influ
ences the GATT negotiations
occurs between the three power
ful trading partners—the US, EC
and Japan in the meetings of the
Group of Seven (G-7) industrial
countries.
5
GATT : In Whose Interest ?
look into the origins and functioning of GATT,
both, in its early days and now, establishes the
domination of the US thinking and interests in particu
lar, and that of thedeveloped countries in general. It
was the US which mooted the idea of an International
Trade Organisation, and yet, fearing a restriction on its
ability to effect tariff adjustments in tune with the needs
of its economy, it sial led the emergence of ITO. As an
adhoc treaty GATT was preferred as it gave the US the
leeway to amend it from time to time to accommodate
the changing perceptions and needs of its economy.
Interestingly, every round of trade negotiation has been
so closely linked to amendments in the US trade Act
that the GATT has been seen as an international exten
sion of US tariff policy.
The domination of the US and the developed coun
tries in theGATT negotiations, was apparent even in
the fifties. An early review of the functioning of GATT
by the Haberler Committee endorsed the view that
A
GATT Negotiations and Changes in the
US Trade Act
J
J
J
J
6
The first five rounds were accompanied by
amendments in the Reciprocal Trade Agree
ment Act of 1934.
The Sixth Round, the Kennedy Round, 196467 followed the Trade Expansion Act of 1962.
The Trade Act of 1974 was preceded by the
launching of the Tokyo Round.
The Omnibus Trade and Competitiveness Act
of 1988 was enacted when the Uruguay Round
negotiations were in progress. The Act gives
unlimited powers to the US Trade Represen
tative to force open the markets of its trading
partners.
developing countries were indeed facing a highly
inequitous system and that GATT had done little to
change the situation. The follow up committees re
vealed that developed countries were hindering not
only the traditional exports of developing countries but
also export of their manufactures through the use of
high tariffs, quantitative restrictions and various inter
nal taxes in stark violation of GATT rules. Later
reviews confirmed these facts. The findings of these
reviews lent considerable strength to the struggle of the
developing countries to demand reform. The obligation
underthe MFN principle—ofequal treatment—they
argued, did not recognise their disadvantageous posi
tion in terms of competitiveness and bargaining power
in international markets.
GATT was advocating theprin'cipleof non-dis
crimination in world trade ignoring the realities where
the weakest members were prevented from competing
on an equal footing. The developing countries perspec
tive, that trade had to be seen as part of development
began to emerge more strongly at the UN forums. As a
response came the United Nations Conference on Trade
and Development (UNCTAD) in 1964. The UNCTAD
reviews endorsed the earlier critiques of the global
trading system. It was under pressure of such criticism
from different quarters that a fourth part was incorpo
rated in the General Agreement in 1965. Part IV
specified that thedevelopedcountriesdid not expect
reciprocity forcommitments in trade negotiations to
remove tariff and other barriers to the trade of the less
developed contracting parties.
Incorporation of Part IV was significant—it
set aside the notion of ‘equality of treatment’ in a
world where some countries were more equal than the
others. It recognised that different countries at different
stagesof development needed to bctreateddiffcrentially.
Post-1965 Trade Scene
The reform of GATT did not, however, change the
international trade relations and it continued to be, in
reality, the rich nations club. The US, the EC and Japan
who are the three powerful members of this club have
used GATT as an instrument to secure ever larger
shares of the world markets. The presence of GATT for
last four decades has not disturbed the overwhelming
dominance of developed countries in international
economy and the perspective with which negotiations
are conducted remain largely developed country-centred.
In addition to the generally unfavourable tariffs
and other barriers faced by develop! ng countries ex
ports, two sectors that have deliberately been kept
outsideGATTdisciplinearetextiles and agriculture.
Textiles and clothing trade has been governed since
1974 by a separate agreement, officially recognised by
GATT—the Multi-Fibre Arrangement (MFA). The MFA
which replaced previous arrangements (Short Term and
LongTerm) stretching back to the early 1960s, fixes
quotas for developing countries wishing to export tex
tiles to industrialised country markets. It represents the
most flagrant violation of the GATT principles. Envis
aged as a temporary departure, the MFA has acquired a
semi-permanent status which the developed countries
until the Uruguay Round have consistently refused to
withdraw. It is aclassicexampleof double standards
practised by developed countries to restrict trade in an
area where many developing countries have a competi
tive edge. The successive extensions of MFA have
brought more and more textile items and countries
witnin its jurisdiction.
The other significant exclusion from GATT rules
has been agriculture. The waiver demanded by the US
in 1955, allowing it to impose import controls to protect
its agriculture in the name of maintaining food self-suf
ficiency, is yet another proof of how GATT rules were
moulded around the interests of the United States. This
waiver has been flagrantly abused by the US and later
by the EC to build huge stocks through liberal subsidies,
and then dump these on to world markets, again with the
help of subsidies, undermining in the process tradi
tional food producers in developing countries. It is
Free Trade in an Unequal World
Multi-Fibre Arrangement
Loss of Developing Countries
Practice of fixing quotas on textiles trade was originally targeted at Japan. The discriminatory charac
ter of this practice revealed itself when it was extended to textiles exports of developing countries through
a separate agreement in 1961 called the Short Term Arrangement. Then came LongTerm Arrangement,
finally giving way in 1974 to the Multi-fibre Arrangement (MFA). The MFA allows developed countries
to impose bilateral quotas on individual developing countries for hundreds of categories of textiles covering
the entire 30 billion dollars trade in textiles exported from developing countries to developed countries.
Even the poorest and small countries like Bangladesh have not been allowed to escape lite crippling effects
of this agreement. In 1985-86 the US, France and Britain imposed quotas on shirts from Bangladesh claiming
that its textile exports threatened their local industries. The facts expose the fallacy of these claims. Bang
ladesh’s shareof clothingexports wasjust 0.25 percentof the developingcountriesexports of clothing
compared to 60 percent for countries like South Korea and Hong Kong. Even then it was forced to accept
import quotas which restricted its share of the UK shirt market to a 4 percent ceiling. What did these quotas
mean for the economy of a poor country like Bangladesh ? Half the country’s shirt factories were closed.
' some 150,000Jobs. mainly held by women, were lost,
Because of
US billion
$
1.
Unequal partnership in global economy
-Higher Interest Rates
-Negative capital transfer
-Unequal competition in international
services
2.
120
50
20
Restricted access to markets
-Labour
-Manufactures
-Agricultural, tropical commodities
-Technology
250
35
5
20
Total
500
|
Scarce : Human Development Report, UNDP. 1992
7
these subsidies and not efficient production which enabled etc.) symbolises the continuation of their position in
the US to emerge as the world’s largest cereals supplier, colonial days where their economies supplied cheap
with PL 480 subsidies accounting for around a third of raw materials to serve the interests of their colonial
rulers. Only thr? actors have changed—today their
its total exports.
Similarly variable import levies, quotas and other expons serve the interests of handful of Transnational
measures were used by the EC to insulate its agriculture Corporations which control prices in the world markets.
from competition. Hefty export subsidies made pos High tariffs in developed countries on processed goods
sible the emergence of EC in the early 70s as a major prevent the developing countries from graduating out of
force in World agricultural trade posing a threat to the this dependence on raw commodities. For instance,
dominant position of the US. Since then the US had half of all countries in Sub-Sahara depend on just one or
been demanding incorporation of farm policies within two commodities making them highly vulnerable to
GATT which explains appearance of agriculture on the policy changes and price fluctuations. World sugar
prices have experienced the worst fall under the impact
agenda of the Uruguay Round.
of EC export dumping and competition from corn
based substitutes and reduction by US of its sugar
Commodity Trade
imports in the 80s causing untold hardship to sugar
International commodity trade, where developing producers. Steepfall inpricesof other commodities
countries had major export interests, is yet another like cocoa, coffee, tin, rubber resulted in loss of export
reflection oil their highly inequitous position. The earnings for a number ofdeveloping countries. This
critical dependence of developing countries on export also meant a worsening balance of payments situation
of primary commodities (coffee, timber, cocoa, rubber pushingthemfurtherintodebterisis. Paradoxically,
“I pledge allegiance to the flag of the country
that gives me the best deal.”
GATT and the World Trade
(Farfrom leading to a free and fair trade the amended GATT has continued to work to the advantage of developed countries)
■
■
■
■
8
Share of developing countries’ manufactured ex
ports stood at 11.2 percent in 1966; in 1988 it
increased to merely 13.8 percent.
Three quarters of international trade and invest
ment flows still take place between the developed
countries which account for just 15 percent of
world’s population.
Within the industrial countries, the US still enjoys
a dominant position accounting for some 45 per
cent of the combined GDP of OECD countries
?<nd 18 percent of world’s manufactured exports.
Malaysian exports of unrefined palm oil to EC
attract less than two percent tariff, if same oil
--------------------
------
■
■
■
were to be processed into high value-added margafine the tariff would jump to 25 percent.
Developing country exporters of coffee and tea
receive less than 20 percent of the market price of
their products.
Six unprocessed timber-exporting developing
countries receive on average only 9 percent of the
final product price.
Commodity prices declined at the rate of 6.7 per-
■
centper annum during 1980-89 following two
decades of moderate decline. In 1990 the prices for
Third World’s ten core commodities were about 25
percent lower than they were in 1980.
■
Pursuing the IMF-WB prescription of increasing
exports for meeting debt service obligations, SubSaharan cocoa output increased by 26 percent
between 1985-89, but 15 countries dependent on
cocoa as major export lost over 3 billion dollars.
In Ghana, 50 percent increase in cocoa produc
tion, at the cost of .food crop production, was
accompanied by a reduction in foreign exchange
earnings.
Debt servicing now absorbs a third of the foreign
exchange generated by American and Latin Amencan exports.
mounting pressure on developing countries to repay
debts, were responded to by stepping up commodities
exports in an effort to earn more foreign exchange,
leading to a glut in global markets. These issues, al
though of vital concern to developing countries, have
not been dealt with at GA I T with any seriousness.
GATT and the TNCs
And lastly, the expanding influenceof Transna
tional Corporations and their nefarious role in distorting
world trade has been ignored by the GATT, which does
not even recognise their existence. There are no provi
sions in the GATT for dealing with the restrictive
business practices characteristic of the TNCs. These
range from price fixing cartels in sectors like electron
ics, computing and pharmaceuticals, to efforts to re
strict access to technologies, transfer pricing or ma
nipulating of prices in intra-firm trade to minimise tax
liability in the host country and transfer profits to the
parent company. For example, in the timber industry
cases have been reported of logs being exported from
Indonesia at prices under valued by as much as 40
percent. Recently the World Bank accused a UK
company of charging Kenyan Government five times
the normal price for consultancy services on a contract
backed by the British government. Such examples can
be endless. Even though, between a quaner and a half
of world tradeisbeingconducted withinTNCs of the
developed countries, GATT has failed tomake them
accountable to any multilateral discipline. And when at
last the TNCs appear on the GATT agenda in the
Uruguay Round, it is only to give them unrestricted
freedom to penetrate further into the third World mar
kets in ever new sectors of their economy.
"For them (the MNCsl all countries are just markets to be
exploited, all laws are but obstacles to be circumvented
through bribery where it works and through the delays in
the legal process itself where it doesn't.”
Vishvjit P. Singh , Member of Parliament
NTBs: A Flagrant Abuse
Recent decades have seen a rise in Non-Tariff Barriers (NTBs) affecting key products in which
developing countries' have large export interest. According to the World Bank, 31 percent of deve
loping countries exports face N I Bs compared to developed countries' 18 percent.
Different kinds of measures are resorted to by developed countries to insulate their industries
from competition. Eg. variable levy systems operate in the United States (forsugar); inSweden,
Switzerland and Austria (for vegetable oils, fruits, nuts, cut flowers). Japan uses quantitative
restrictions toprotectitspeanutfarmersfromcompetition fromexportersin Latin Americaand
West Africa.
Voluntary Exports Restraints (VERs), one of the most commonly used NTBs, is an agreement
under which countries are invited to 'voluntarily7 restrict their exports. Of the 284 Export Restraint
Arrangements instituted by GATT members by 1990, a large number concerned products where
developingcountries weresubstantialexporters.Theseincludedagriculturalproducts, textiles
and clothing, steel and steel products, electronics and footwear. Mostly the developing countries
are compelled todosounderfearof retaliation. TheUSAdministrationinl 984negotiated VERs
on Steel imports with 19 countries including Brazil, Mexico, South Korea with a view to cut the level
of Steel import from 25 percent to 18 percent of its domestic consumption. The EC did the same
when it imposed VERsonBrazilianSteel,ThaiCassava and South Korean teddybears.
Who is Financing Whom ?
Since the mid-1980s, the Third World has been financing the living standards and the
deficits of the industrialised world by net transfers of interest and repayment,
amounting to Rs. 10,000 crore ($40 billion) per year. Not only the commercial banks,
but also the IMF, World Bank and bilateral donors have been appropriating net trans
fers from the developing countries.
The net transfer is the difference between capital inflows in the form of new loans
and outflowsofdebtservicedueonpreviousborrowing. Debt-service is composed
of interest repayment of principal. When debt service exceeds new borrowing, net
transfers are negative, resulting in a cash flow from debtor to creditor countries. In
this way, the negative net transfer to the industrialised world is Rs. 55,000 crore ($ 227
billion) since the 1983. The transfer of real resources from debtor to creditor countries
have been effected by painful adj ustment with IMF structural adjustment program
mes. However, the stock of debt is increasing.
9
The Politics of Uruguay Round
ot long after the Tokyo Round concluded, call for
launching another round of GATT negotiations
had begun to be made by the industrial countries, par
ticularly the US. As aresult of their sustained efforts,
the Uruguay Round was launched on September 20,
1986 atPuntadelEste inUruguay.
N
Towards Recolonisation
The Uruguay Round has been the most controver
sial of all the rounds. The negotiations have dragged
on for more than six years. The aim of this Round
distinguishes it from all the previous rounds which
were generally aimed at promotion and regulation of
trade in goods across the borders of countries. The
developed countries have forced an agenda, on initially
reluctantdevelopingcountries, which covers wideranging issues, going far beyond trade in goods.
Aimed in this Round are the domestic socio-economic
policies of countries, on the specious plea that these
distort trade.
In effect, the agenda of the Eighth Round is only a
part of the globalisation and a new world order that the
developed countries are promoting. The real actors, on
whose behalf, this is being done are the TNCs, whose
global expansion can only take place by limiting the
sovereignty of nations. The Uruguay Round aims at a
comprehensive opening up of the global markets for the
benefit of TNCs. The removal of all restrictions in
developing countries is being demanded which hithertoenabled them to pursue a path of self-reliantdevelopment in various sectors of their economy. The inter-
TNCs and the Uruguay Round
URUGUAY
ROUND
n™
(jjil |
Courtesy : P-Mary/BIJA
10
The powerful corporations located in the developed countries particularly in the US, lobbied intensively
firstforthe launchof the Uruguay Round and thenfor ensuring the protection of their interests in all the
areas of negotiations. All through the protracted negotiations, they have been able to dictate priorities to
their governments.In theUS, even before the launchof theUruguay Round,financial and agrochemical
companies and their associations had taken the lead in forming the Multilateral Trade Negotiations
Coalition—an alliance of over 200 companies led by American Express, CitibankandIBMto lobby the
Government in taking appropriate stands. Leading corporations were invited to chair a series of panels set by
President Reagan to advise him on the negotiations. European TNCs have, by and large, backed the MTN
Coalition and its demand. Citibank and American Express have been in the forefront as far as the US
negotiating stance on financial services is concerned. The Intellectual Property Coalition, whose members
include agro-chemical giants like Pfizer, Monsanto and Du Pont have been aggressively pressing the US
Administration into demanding a GATT-based global patenting system enforceable in developing countries.
In agriculture, Cargill Corporation, the world’s largest grain trader had assumed responsibility for prepar
ing the United Stales negotiating papers—the twin objective of their stand has been to reduce food import
restrictions in the developed and developing countries and phasing out market-based price support. Thus the
agenda of the Uruguay Round is in fact the agenda of the TNCs which has been imposed on the developing
countries.
est of leading industrial countries, particularly, the US
and their TNCs, in the Uruguay Round has been
intensified because of increasing competitive pressures
on the World economy. Large-scale trade deficits of
the US throughout the 80s, emergence of competitive
strength of Japanese TNCs, rise of the newly industri
alised countries (Korea, Singapore, Hong Kong,
Taiwan), threat to the US agriculture from EC, possi
bilities of full economic integration of Europe, rapid
technological advances in the field of macro-electron
ics and computer technology and emergence of bio
technology have been some of the forces leading to a
scramble for shares in shrinking global markets.
It is in the above context, that the agenda of the
Uruguay Round, largely the agenda of the developed
countries, seeks to extend the area under GATT regu
lation and to restructure GATT by investing it with
sweeping powers to enforce compliance with new
rules.Under attack, is the ‘Special and Differential’
treatment principle of GATT which allowed develop
ing countries to impose controls on imports in keeping
with the developmental needs of their economies. The
Uruguay Round, if concluded, in the way developed
countries desire, would create an even more unequal
world economic order than the one exists today.
The Power of the TNCs
■
controlled by just 500 corporations,
which also control 80 percent of for
eign investment and 30 percent Of world
GDP.
■
Shell Oil’s 1990gross income ($132
billion) was more than the total GNP of
Tanzania, Ethiopia, Nepal, Bangladesh,
Zaire, Uganda, Nigeria, Kenya and Paki
stan combined. Five hundred million
people inhabit these countries, nearly a
tenth of the world’s population.
□
Cargjll, the Canadian grain giant, alone
control s 60 percent of the world trade
in cereals. Its turnover in 1990 was the
same as Pakistan’s Gross National
Product.
New Themes
Traditionally, GATT dealt largely with trade in
manufactured goods. The attempt in the Uruguay
Round is 10 bring under GATT, trade in services and
agriculture and seek removal of all existing barriers
to investment and stronger protection from the laws of
the Third World countries to help the TNCs tighten
their grip over technology. The agenda is geared
towards securing unrestricted freedom for the TNCs,
not just in manufacturing and agriculture, but also in
sectors like banking, transport, telecommunications.
Eighty percent of American exports are generated by
Amercian TNCs alone. While the US had an overriding
interest in seeing removal of subsidies in agriculture,
Seventy percent of worlcf trade is now
the industrial countries in general are attaching special
importance to the new themes of trade in services,
investment and intellectual property rights.
Whileincluding the new themes on the agenda
the developed countries’ arguments completely
ignored the realities of the world trading system which
is heavily set against the developing countries.
■
Just 13 corporations supply 80 percent
of all automobiles: five of them (General
Motors, Ford, Toyota, Nissan and
Peugeot) sell half of all the vehicles
manufactured each year.
■
US corporations spend more than one
billion dollars yearly on advertising.
The averageUS citizen viewsZl ,000
television commercials every year.
i.
Trade In Service
In the world of trade, services are among the fastest
growing sector— a quarter of world trade flows, is now
accounted for by services such as banking, insurance
and telecommunication. The export of services has
become increasingly significant for the rich countries
where the service sector accounts, on an average, for
over half of national incomes—70 percent in the case
of the US, which is the world’s largest service
exporter. The90 billion dollars that trade in services
generates partially offsets its trade deficit in goods.
Naturally then,TNCs like the American Express and
Citibank have a major stake in expanding world trade
in services. In this, the various investment regulations
in the developing countries, are seen as causing
distortions in free trade. Service companies, therefore,
pressed their governments to call for removal of all
existing curbs so that foreign firms have a ‘right
of establishment ’ in other countries and are treated at
par with the local firms.
Not only that, their home countries should
intervene on their behalf, if their interests are per
ceived violated in the host country, by retaliating
against the companies of the offending country. The
violating country could also face what is known as
‘cross retaliation’ i.e. the offended country can retaliate
not only against service firms of the offending country
but also against its companies involved in goods trade.
Such demands, if accepted, would empower
GATT to sanction measures which would allow
developed countries to hit the interests of developing
countries where it would hurt them most—ei lher intropical products or in selected manufactured goods
where they have gained competitive strength.
ii.
TradeRelatedlnvestmentMeasures
Most developing countries impose certain condi
tions on foreign investors referred to as ‘investment
measures’. These impose obligations like use of
specified percentage of locally produced raw material
or components, local equity requirements, export
performance and control on imports requiring foreign
investors to use domestic supplies. Eg. in India, over
90 percent of collaboration agreements involving
foreign investment are subject to such measures. The
main idea behind these measures is to regulate the
operations of foreign investors and to protect local
industries from unfair competition, to safeguard coun
tries balance of payments condition and to curb .unethi
cal TNC practices like transfer pricing. Developed
countries argued that these measures are not less than
protective tariffs as they deny market access to a service
industry wanting to invest in another country and should
therefore be removed.
iii.
Trade Relatedlntellectual Property Rights
The Uruguay Round negotiations on intellectual
property are concerned with securing more protection
for the TNCs. The US based Intellectual Property
Coalition—a grouping of 13 major companies, per
suaded their governments to press for intellectual
property protection to be brought under GATT rules
with the threat of trade sanctions for strengthening
patent protection.
“Intellectual Property” refers toan invention of
a design, technology or a product by a person or a
corporation and ‘right’means recognition that the
investor be rewarded by granting it the exclusive right
to use it or earn royalties by renting its use toothers.
Various rights awarded include—patents, copyright or
trademarks. Presently, countries have framed their own
laws concerning IPRs in keeping with their own
national interests. While laws in developing countries
are geared towards granting limited rights to the
inventor or investor, most developed countries laws
today confer exclusive rights for longer time frames
giving them market monopoly. Developed countries
argued that laws governing patents in the developing
countries did not adequately protect the investors
interest, thus served as disincentive to research and
innovation. They maintained that inadequate protec
tion of IPRs of investors had resulted in huge losses (US
claims a loss of S 60 billion annually) to the firms of
developed countries because of piracy and trade in
counterfeit goods. The laws should therefore be suita
bly modified to remedy the distortions in trade.
It is well-known that the sole aim of TNCs in
registering patents in Third World is not to transfer
technology but to prevent local firms/individuals from
adapting or inventing new technology. The purpose is
to capture the Third World markets for products
manufactured elsewhere and therefore, they are seek
ing longer time frame and removal of legal obligations
like using the patent in the country granting patent.
iv.
Agriculture
By and large, agriculture was outside the GATT
regulated trading system, except for trade in
tropical products. It had been brought onto the agenda,
not because of the serious problems in agriculture
caused by the aggressive agricultural policies pursued
by the US and its rival, the EC countries. Dumping of
surplus agricultural grains onto the international markets
at pices many times below the cost of production have
12
spelled ruin for a large number of small fanners in third
world countries. Once again, the agri-business firms
have their eyes on the third world markets and in a
bid to capture largest shares for themselves the US had
been resorting to price cutting in the export markets.
And now the US finds payment of subsidies by EC for
agricultural exports as trade distorting, arguing for
inclusion of agriculture within the purview of GATT
by phasing out of all subsidies. The EC while agreeing
to the US at broader level, did not agree on the
modalities and extent ofreduction of subsidies. It is
this difference among the US & the EC over the issue
of subsidies which had been at the centre stage of the
negotiations for five years. While the two trading
giants were busy sorting outdifferences, they were
both agreed that developing countries should also
phase out all subsidies ignoring completely the
difference in the subsidies for exports of the surpluses
in developed countries and subsidies paid to ensure
food security for the people in the Third World coun
tries.
The most striking feature of the Uruguay Round
Agenda is the interconnectedness of the new themes.
All the new themes converge in their common concern
to help the TNCs expand their present operations and
protect their interests in Third World countries. While
TRIMs would allow TNCs to operate without any
controls imposed by the host countries, TRIPs would
lighten their existing control on technology through a
rigid patentee-biased IPR regime holding the techno
logy diffusion for longer time. Entry into services
sectorwouldallow them access to mostcritical and
sensitive sectors of economies and liberalised
agriculture would assure huge markets for expansion
of agriculture corporations who already dominate
world agriculture trade scene.
Position of Developing Countries
At the very outset the developing countries op-
Trade Liberalisation:
Who Pays ?
What
would
be
the effect of trade
liberalisation in. the west on developing
countries like India ? According to a study,
by the year2000 there woul d be 5.6 percent
more hungry people in India than would be
the case if the current trade policies were
continued and no liberalisation takes place.
There would be a reduction in the amount of
calories and proteins available per capita and
reduction of 26.2 percent in the human
consumption of agricultural produce. For the
developing countries, as a whole, increase in
the number of hungry people will be 3.6
percent with disastrous prediction for Afri
can nations, some of whom are already in the
grip of chronic hunger and malnutrition.
Falling Economic and Welfare Standards
(Jn
Indicator
1. GDP
2. GDP Agriculture
3. Human consumption of
agricultural products
4. Net Calories produced
5. Calories/Capita
6. Protein/Capita
7. Number of Hungry
Source : Frotiberg et al (1990)
1990
2000
0.2
0.1
0.1
0.1
+0
02
-0.7
-0.8
3.1
-26.2
0.7
-0.9
-1.0
5.6
posed the idea of a new round and insisted that GATT
should concentrate on the unfinished commitments
undertaken at Tokyo round. When the Uruguay
Round was launched they resisted the inclusion of
new themes, particularly, IPR as being outside the
purview of GATT. Countries like India and Brazil
played a particularly key role in leading such opposi
tion. But gradually this resistance against the efforts to
impose an agenda extremely hostile to the interests of
developing countries became weakened. It must be re
membered that when the Uruguay Round was launched
more than half the developing countries had already
gone in for loans from IMF and the World Bank
and were deep in debt. The collapse of the Soviet
Union, and ineffectiveness of the forums of developing
countries weakened their negotiating position.
With India coming under the net of IMF-World
Bank, it became easier for the developed countries-to
have their way. The unity of the countries of the
Third World also broke because of bilateral pressures
especially from the US under Super and Special
301, which it continued to use all along. For instance,
when negotiations were on in Brussels (December
1990), India was on Super 301 for not opening its
economy to US firms in the area of insurance. This
was enough to blunt the stand taken by the Indian
representative during the negotiations.
Today, the Third World countries stand disunited
for wantof an effective leadership. And yet the need
for developing countries to put up a common front
to resist imposition ofahighlyunequalworldorder
is greatest now than ever. It is unfortunate that while
US and the EC withheld the negotiations for one
full year, there was hardly any attempt by the develop
ing countries to come together on issues of common
concern. Unfortunately, Indian Government, of late,
have adopted a defeatist attitude and have been busy in
an exercise to convince the nation that the package
offered by Dunkel is the best that the country could
hope for.
13
Status of Uruguay Round
and the Uruguay Round .......
It was earlier envisaged that this round would be
concluded by the end of 1990. The rich nations club,
asGATT is, negotiationsremainedstalledprimarily
because of the differences among the US and EC on the
issue of farm subsidy reduction. When till theend of
1991 no agreement seemed to be in sight on important
issues, Arthur Dunkel, GATT Director General, presenteda DraftFinal Act withthesoleaimofbringing
the Uruguay round to‘successful’conclusion. He
offered the draft as a single package on a “take it or
leave it” basis leaving little room for countries to
disagree in any substantive ways. The Draft did not
reflect the spirit of the negotiations, completely ignor
ing the views of developing countries. It was in
effect, only a compromise position among developed
countries. The compromise proposals on removal of
farm subsidies were still a bone of contention between
the EC and the US who managed to keep the
negotiations suspended for the whole of 1992. It was
only in November 1992 that they struck a deal and were
SILENCE.
Gro++ Mee-hnj
in
Progress
you
wait
14
can'+ come
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every + hma I
...
India was in theforefront of leading the third world toopposetheattemptsbythedevelopedcountries
to seek sweeping concessions entailing irreversible changes in domestic laws and policies. But itssilence
at the 1989 Geneva meeting on the question of inculsion of IPR norms as part of the negotiations marked
the starting pointof thegreatsurrender to the demandsof the developed countries. This also was seen as
abetrayalofthe faith thatdeveloping countries had been placing in India’s ability to lead. Since then the
country’s leadership, supported by vested interests in industry, trade organisations and bureaucracy has
been moving in the direction of accepting the Dunkel proposals in the’national interest.’ If it has gone slow,
it is because of the strength of popular opinion against the Dunkel proposals. The expert groups and
networks opposing theproposalsfeelthatthegovernmentisnotserious about dealing with the concerns
being raised “If it were indeed serious, it would not have allowed four Parliamentsessions to have gone
without thecontroversialdraftbeingdebated. If the governmentwasseriousaboutseekingtheopinionof
all political parties on the draft why has it waited for a year losing valuable negotiating time. The
Government has been making blandassertions that the proposals will not affect us adversely but it not ready
for a debate?” The paper for discussion prepared by the Commerce Ministry on the basis of which it was
hoping to initiate a debate, itself came in for sharp criticism. While appearing to answer some popular
concerns, the paper took recourse to half truths, distortions and omitted vital facts aboutthe draft and
the negotiations. A paper which conceals more than it reveals cannot be the starting point for a debate. The
expert g roups which have made a thorough examination of the proposals clearly establish how these will
mean subversion of India’s laws and its Parliament to multilateral discipline. Should the people of India
allowthemselves tobemisledbytheirleaders.andshould the stategovernments see open infringement
of their policy making prerogative in subjects such.as agriculture ?
“Right through,
developing coun
tries were margi
nal ised as parti ctpants.
In the
green room con
sultations
on
TRIPs, only after
protest, Egypt
was allowed to
join on behalf of
the
African
world"
ready to resume the negotiations. The negotiations
are likely to resume in February, but with France,
particularly the French fanners opposed to the US-EC
deal, the tough positions being taken by the new US
Administration toward trade with EC and Japan, and a
host of other unsettled issues, the fate of Uruguay round
remains uncertain. 88
“Patents are a paradise for parasites"
J Gcigy-Mcrian, Geigy Firms (later Ciba Geigy) in
1883.
’llisCibaGeigy’sposition that legalproteciionof
intellectual property serves the public interest by
stimulating continuing investment in technological
innovation."
Jolin H Ducsing, Ciba-Geigy in 1989.
IMF-WB - GATT : THE UNHOLY TRINITY
Why are developed countries so eager to see the successful conclusion ofthe Uruguay Round ? It can beargued that many of the proposals being put
forth by them through the GATT are so similar to the reforms being imposed on Third World economies as part of the structural adjustment programme of the
Bank-IMF. An important thrust of the standard package of structural reforms is liberalisation and opening up of the borrowing countries economies.
Free trade’ with emphasis on export - led growth constitutes a key strategy in the' economic recovery being sought through the reforms. Now if the develop
ing countries can be made to give concessions to foreign investors via the WB-IMF route why should then there be so much concern for pushing similar changes
through GATT?Thereasonsarestrategicandnotfarto seek and linkages are clear. Trade in the present world scenario constitutes an important aspect
of the economies of thecountries, especially so for a number of developing countries which are precariously dependent onforeign markets for earning pre
cious foreign exchange with which toimport necessities like food and other goods. Thus it is a reality nocountry,particular)y developing countries,can ignoreeven ifthe terms of tradeareagainst them. And while itmaystillbepossibleforcountriestoavoidinfluenceofWB-IMFby deciding not to go in for loans,
a trading system backed by retaliation provisions can compel countries into submission irrespective of who heads the government The effect of the agreements
countries would enter into under the Uruguay Round would be much more final and irreversible than a decision to implement structural adjustment pro
gramme. Together, the World Bank-IMF-GATT trinity is facilitating the recolonisation of Third World through a new conquest of their markets. This take
over of Third World markets for the benefit of TNCs would take the process of Third World subjugation in a Transnational World Order closer towards
completion.
TheUS, GATTand Agriculture
P
Standard Menu I
IMF-WB
'
♦/'*
GATT
Reduction of budgetary subsidies
Reduction of subsidies
Removal of subsidies for agricultural inputs
Reduction of support for domestic agriculture
Removal of food subsidies
Removal of PDS
Pursuance of ‘liberal’ economic policies by
developing countries
Pursuance of ‘free trade’ by developing countries
Promotion of foreign investment
Removal of restrictions onTNCs
Import liberalisation
Removal of barriers on imports
Privatisation of utilities
Removal of restrictions on the entry of TNCs
inutilities
Privatisation of the banking sector
Lifting restrictions on entry of foreign investors
in services including banking
Agriculture wasbrought on toihe GATT agenda
: because the US suddenly found itself in compe
tition with the EEC countries in the international
agricultural trade. As long as the US control led
a very largeproportion ofthe market, agriculture
was kept out of GATT. The moment it realised
that its supremacy was threatened, it started
demanding thataset of rules should be evolved
under GATTto protect its interests.
"We have to establish some common rules"
15
Dunkel Draft and the Developing Countries
he controversial draft agreement was tabled by
Arthur Dunkel, Director General of GATT on December20,1991. Negotiations based on the Dunkel
DraftText(DDT)extendeduptomid-April in 1992
with the hope of arriving at a compromise, so that the
new multilateral trade regime could become effective
T
from 1st January, 1993. However, the negotiations
broke,once again, for theinabilityoflhedeveloped
countries to settle their differences.
The 436 page text, largely takes care of the
economic interests of the developed countries, while
neglecting completely the interests of the developing
countries.
The Dunkel proposals divide the Third World
countries by distinguishing between “leastdevel
oped” and “developing countries” with the purpose of
rendering ineffective, the application of the provision
for Special and Differential Treatment which was till
now available to developing countries.
These provisions, especially XVIIIB, had allowed
developing countries to use quota restrictions and other
measures to contain BOP problems.
The draft textgoes far beyond theoriginalmandate agreed at Punta del Este, and makes inroads into
the domestic policies. And this is evident from the
rules sought to be framed in the new areas that have
come under the purview of GATT-agriculture, TRIPs,
TRIMS, and Textiles.
On Agriculture
The draft text on Agriculturesets out elaborate
rules for managing domestic agriculture. The
conditions under which agriculture can be supported
have been laid out instrict terms.
Direct Price support, according to the Dunkel
Draft, cannot be provided to producers, in other wordssubsidies to agricultural producers cannot be given.
As part of this, the norms for government
intervention in agriculture have been laid down,
with equal rigidity. Governments cannotintervene
in the market by way of providing subsidies to the
consumers as is normally done in countries like India.
Providing food aid to certain sections of the popu
lation has been permitted subject to “clearly defined
criteria related tonutritional objectives”. Anadded
conditionlaiddown in the text, in this regard, is that
financing and administration of the aid shall be
16
transparent”. This means that the respective govern
ments would remain under scrutiny of the world
trading system, even while deciding the sections of the
population they consider eligible for coverage under
the“safetynet” of food aid.
While allowing governments to provide support
for public stock holding for food security purposes, the
acquiring and disposal of the commodities can be done
only at the ruling market prices.
The only freedom that governments have been
allowed under the proposed rules is in providing
support facilities like infrastructure, environmental
checks and marketing assistance which are strictly in
the nature of advisorial service.
The draft allows some kind of domestic support
which can easily be used by the developed countries to
continue to support their agriculture. Included here, are
provisions for regional assistance (assistance for back
ward areas). Thus in the UK, since 1986, 52.5 percent
of the agricultural land has been designated as less
favoured area to become eligible for government
support. These support systems will allow fanners to
continue to export below cost Of production and hence
distort trade.
Dunkel Draft does not protect the developing coun
tries from such subsidised imports since Article 7.3
states that these subsidies shall be considered nonactionable for purposes of counter-veiling measures.
The negotiations leave the MNCs untouched even
though it is they who have been largely responsible
for trade distorting practices. Cargill Inc. which has 25
percent share of world grain trade was a target of
investigations in various countries, including the US,
for trade malpractices. Today, MNCs like Cargill are
using Dunkel Draft on agriculture to restructure the
world agricultural market according to their needs.
It is being argued that liberalised agricultural trade
could also benefit countries like India though these
havenotbeenexportingonasustainedbasis.Even if
developing countries are able to generate exportable
surplus, it does not imply that markets for these prod-
Patents and Agriculture
Patents
were
originally meant for
promoting diffusion of
technological innova
tions having potential
for industrial applica
tion. Plant and living
organisms were never
meant to be covered
by such protection.
The MNCs want the
strongest monopolies
for theirproducts and
technology with world
wideapplication.
The extension of
the concept of own
ership of property to
agriculture represents
a potent tool in their
hands to extract prof
its in perpetuity from
farmer, without actu
ally controlling the
land. MNCs are sup
pliers of key agricul
tural inputs in a
number of countries
and of all these the
most critical input is
theseed. With the ad
vent of biotechnology
plant breeding activity
for production of high
yielding hybridseeds
holds out great promisesforMNCs.
It is no accident that
the recentyearshave
seen the largest num
ber of take-overs of
smaller bio-tech firms
by multinaiionaJs. While
30 pesticides manufac
turers existed h the mid,
1970s in the US, only
10 exist now, control
ling three quarters of
global markets. A targe
number of chemical
and pharmaceutical
companies are now
going into the seeds
business. Once that is
in their control, the mar
kets tor their other
products—fertilisers,
pesticides will be guar
anteed. A number of
them are engaged in
or supporting research
for development of hy
brid seeds which re
spond to their specific
IFTHE SEED FROM YOUR PLANT FALLS IN brand of the chemical.
YOUR NEIGHBOUR'S GARDEN AHO GROWS Ciba-Geigy has already
THERE, SOMEBODY’S RIGHTS MAY BE
developed a seed which
is resistant to its chemi
INFRINGED.
cals.
Courtesy : Surtsh Sauxint/Potent FcJly
17
Unbridled Piracy
The demand to extend the scope of I PR to
all living matter is backed by agri-business cor
porations. Under the new IPR regime entire
species of crops, animals (their seeds and
offspring) canbepatented as private property
of companies. Thus royalty payments on cbned
varieties of commercial crops like palm oil,
cotton, rubber, exported by developing coun
tries, will be increased. Coupled with removal of
export subsidies, the strength of these countries
as exporters wi be further eroded. These demands
represent nothing but an unbridled piracy as
overwhelming bulk of genetic resources usedin
the labs of developed countries firms are deri ved
from plants and crops in the Third World.
Genes from Ethiopian Sorghum, African
cowpea and Bolivian potatoes have been trans
planted to improve crop resistance to disease in
the developed countries. Because these resources
have never been subjected to IPR rights in
developing countries, companies have been
gaining access to them free of charge. Once
incorporated into a patentable invention they
becomethepropertyof the company which can
claim royalty payments and restrict access to
them even when these are imported to countries
of their origin. In contrast, the farmers who se
lected and evolved thecrops over generations
of hardworkandintelligencewill not be compen
sated for or entitled to royalties. Leaving aside
the ethical, moral and cultural considerations, the
technical basis of extending IPR to plants and
other life forms is very weak. For example, the
genetic material is not invented in the manner
required for patenting. Moreover, these discover
ies do not belong to any one single scientist or
country. Can these then be removed from public
domain to be owned as private property?
18
ucts would automatically be found, especially in the
developed countries. This is because the Dunkel Draft
indicates that ‘sanitary and phyto-sanitary standards
would have to be improved. These standards relate to
theuse of toxins and other agro-chemicals which are
seen to affect human and animal health. In the past,
developed countries have raised the issueof sanitary
and phyto-sanitary standards while rejecting exports
of primary commodities from several developing
countries. Their main contention being that developing
countries do not use the right proportion of pesticides
and other agro-chemicals thus creating health hazards.
These standards, as proposed in the Dunkel Draft, can
be used as important non-tariff barriers against exports
of developing countries. While there would be real
constraints for developing countries to find market for
their exports, they would be compelled to open their
markets to imports, if the Dunkel proposals are
accepted in their present form. The proposals provide
for a minimum access opportunity for imports by every
country. For developing countries the minimum market
access would have to be 2 percent of the total consump
tion in the first year of implementation of the proposals
and would have to go upto 3.33 percent in ten years. In
countrieslikelndia where the consumption is large,
the extent of imports would be correspondingly large.
Apart from the financial implications of spending pre
cious foreign exchange, the compulsory imports would
be inimical to the objective of achieving self-reliance
in food and would, therefore, have serious food
security implications for developing countries. For
many countries, dependence on food imports, does not
bring happy memories and it is with this concern that
Dunkel proposals in agriculture must be viewed.
On Intellectual Property Rights
The major problem in case of the agreement on
TRIPs arises in the area of patent rights. Patents are
generally considered as an intrinsic pan of the process
of generation of technology. It has been argued that an
innovator undertakes risk in carrying out advances in
technology which benefit the society at large. To
ensure that he gets some return from the investment he
has made, the society must assure him a certain period
of exclusive rights over the market for the product
he has developed. These exclusive rights were
provided by the patent system. A temporary monopoly
was thus assured by the patent system and the period for
which this monopoly was valid was decided by
individual countries.
Thepatentsystem.byprovidingincentivetothe
innovator in the form of monopoly control over the
market, encouraged the innovator to disclose his
innovation. It has been argued that in the absenceof
patent system the innovator may like to keep his
innovation as a trade secret and the advance made by
him may ultimately die with him. The patent system,
thus, provides a mechanism through which any
advance made by an individual in technology gets into
the pool of knowledge for society to use for all times to
come.
But along with the rights conferred on the patent
ees, the patent system also imposed some obligations
on them. The most important of which was that the
patenthadto be used for commercial productionin
any country granting the patentee the rights.
Historically, there has been an attempt to balance
the rights and the obligations of the patentee. This
balance has been substantially removed in the Dunkel
proposals. While the rights of the patentees have been
increased, their obligations have been watered down.
The rights have been increased tn a number of
ways. Thefirst, is an increase in the coverage of areas
under the patent system. In the past, nocountry was
compulsorily required to give a patent or a patent-like
protection for advances made in agriculture. Countries
were free to decide if they wanted to cover agriculture
by the patent system. This freedom has been taken
away by the Dunkel proposals.The beneficiariesof
this change in the patent system would be the large
companies in the developed countries whichhavea
substantial hold overtheglobal agri-business. But as
many analysts have argued, most of the agriculture
in developed countries has, in essence,evolved with the
help of the plant genetic resources from the developing
countries which, in turn, have been maintained by the
farmers in the latter over the millennium. Based on the
genetic resources of the developing countries, thus, the
developed countries have been able to develop the new
varieties of plants. In the present situation, however,
the developing countries wouldhavetopay a heavy
price for buying any technology from the West if
patent protection is extended to plant varieties.
The duration of patent right is sought to be
increased to 20 years. This period of grant is more than
that existing in any country. As stated above, a patent
grant was intended to be a temporary monopoly for the
patentee. In other words, a patentee was allowed to
enjoy the monopoly over a part of the entire useful life
of the product. In recent decades, the useful life of a
product has decreased steadily. The rate of techno
logical obsolescence has gone up and newer products
have been introduced in the market with greater rapid
ity. Under such circumstances the term of patent
should havebeen shorter in order that the principle
of “temporary monopoly” was adhered to. Instead, by
extending the period of grant, Dunkel proposals have
aimed at providing absolute monopoly rights through
the patent system. The obligations on the patentee have
been made less stringent by making the conditions
under which a patentee was required to use his patent
for commercial use in the country granting him the
rights, more favorable to the patentee.
The provisions in the Dunkel draft do not make it
absolutely binding on the patentee to use the patent in
the countries of patent grant. In fact, a suggestion has
been made that instead of setting up production facili
ties, the patentee should be allowed to import the
productinthecountriesgrantinghim patent and this
should be treated at par with his obligations to use the
patent for production in the country of grant.
The implications of enhancing the rights of the
patentee and minimising the obligations should be
viewed in the light of thefact that an overwhelming
majority of the patentees belong to the developed
countries, while developing countries are only coun
tries that grant patent protection to these patentees.
Given this fact, strengthening of the rights of patentee
implies that developing countries access to technology
covered by thepatent wou Id become more difficult.
These countries were dependent on the developed
countries for access to modem technology for their
industrialisation, but with such proposals as Mr.Dunkel
has laid out, the process of industrialisation of develop
ing countries may be truncated.
On Foreign Investment
Domestic control over foreign investment was
regarded as one of the imperatives of the development
process in developing countries. The development
priorities each country had set for itself, was considered
as the bench-mark for foreign investment to operate in
these countries. Such channelisation of investment was
considered essential because the sole aim was to ensure
that investment was put to the best possible use.
Further, in view of the low foreign exchange earning
capacity of the developing countries it was generally
accepted that foreign capital should be utilised to
enhance their export earnings. For this, a two-pronged
strategy was adopted. While export targets were set for
the foreign companieson theonehand, progressive
decrease in the use of imported raw materials was
insisted, on theolher.
From the point of view of protecting their domes
tic interests, control over foreign investment was,
therefore, essential. These policies would, however,
not be possible to follow, if the Dunkel proposals on
TRIMS are accepted. The proposals presented by the
GATT Director General insist on total freedom to be
given to foreign capital.
Limiting the extent to which Governments, par
ticularly in the developing world, can control foreign
capital and use them for furthering their development
needs has been the main objective of TRIMS on which
Dunkel has proposed a very broad-based framework.
Particular emphasis is laid in the dr afton theremoval
of all restrictions that the developing country
Governments were imposing in the past on foreign
capital to prevent them fromimporting excessively
even under simalions where domestic suppliers were
available. The right of the Government to prevent
deterioration of balance of payments position through
avoidable imports would, thus, cease to exist when the
new GATT rules come into operation. Governments
would not be allowed to monitor the activities of
foreign companies in any manner. Investment
decisions by foreign companies would thus depend
on their commercial interests, the development priori-
Farmers Against Free Trade
Sweeping changes being attempted through
G ATT ha vemet with widespread opposition
especially from the farmers worldwide. The
Asian women peasants; Korean farmers; culti
vators in Japan; French formers, and American
people's networks feelalarmedatthedesigns
to take away control of all agricultural inputs—
land, seeds, etc. — from the hands of small
farmers by the powerful agribusiness firms.
Collectively theyarevoicingtheirconcemover
the attempts to control agriculture and the lives
of those dependent on it, by the corporate inter
ests through seeds. In Korea farmers have
launched an antiGATT campaign to resist further
opening of Korean markets to rice imports.
They feel Korean have already given enough
space to imports and will not allow any further
liberalisation.
k---------------------- --------------------- ,>
19
ties of developing countries in which these companies
may invest would become a secondary consideration.
On Textiles
The area of textiles was left out of the GATT
framework till the Uruguay Round. The GATT rules
of free trade were not made applicable to this sector
in which the developing countries had a large trading
interest. The exclusion of textiles was brought about as
the developed countries were keen to protect their
domestic textile industries, and towards safeguarding
their interests they adopted a framework by which
quota restrictions were imposed on developing coun
tries exports. Devised as a purely temporary arrange
ment in 1961 under the Short-Term Arrangement
(STA), the quota regime was extended by a decade in
1964 under the Long-Term Arrangemcnt(LTA). In 1974,
a further lease was given to this system under the
Multi-Fibre Arrangement (MFA). Despite demands
made by the developing counties to integrate textiles in
the GATT framework of free trade, MFA was contin
ued through the eighties.
The Uruguay Round negotiating mandate had
suggested ending the restrictions on textile trade and
bring about the final integration of textiles into
GATT. The negotiations, however, indicated that the
developed countries were not keen to open up their
markets for imports of textiles. MFA, whose latest term
had expired in 1991, was given a fresh lease as a result
of the pressures brought about by the developed coun
tries.
Progress towards integration of textiles in the GATT
would not be easy as the Dunkel draft suggests. A
three-phase framework of integration has been
suggestedby the GATT Director-General spanning
ten years from the date of entry of the Uruguay Round
agreement. In thefirstphase i.e, the first three years
after the coming into force of the Dunkel proposals, 16
percent of the products would have to be integrated. In
the second phase, in the following four years, another
20 ---------------------------------------------------
17 percent would have to be integrated. In the next
two years, a further 18 percent of textiles would be
freed from import controls. On 1st January of the tenth
year of implementation the remaining 49 percent of the
products of the textile industry would be finally
integrated, according to the Dunkel time-schedule.
There are, however, several clauses to this inte
gration time-schedule suggested by Dunkel which
would not allow the integration to take place in the
manner stated in the first instance. The more important
of these is the proposed increase of growth rates of
quota restrictions as they exist at present. In the first
phase, the Dunkel draft states, restrictions on imports
are to be increased by 16 percent. This implies that
while the integration process would reduce the barriers
on imports by 16 percent, the restrictions would
increase by a like amount. Thus, given the increase in
restrictions, instead of a 16 percent liberalisation, the
effective opening up of textile trade would be less than
3 percent. Like-wise, in the second phase, the growth
of restrictions would increase by 25 percent. This
implies that by the end of second phasejust more than
26 percent of textiles can be freely traded. In the third
phase, restriction would be up by 27 percent, and this
would result in integration of about 34 percent of the
textile trade. The slow pace and the end-loaded manner
of integration is, therefore, a critical factor to be taken
into consideration from the developing countries point
of view.
Reversal of Development Path
The Dunkel proposals, if accepted would thus,
affect the development objectives of the developing
countries in a fundamental manner. In the earlier
decades the major item on the agenda in all interna
tional fora was to evolve mechanisms for a rapid
development of all the poorer nations of the world. The
United Nations had adopted the 1960s and the 1970s
as the development decades with the same basic
objective. Sectorial initiatives were taken by a
number of international organisations. The UNCTAD
had, since its inception towards the mid 1960s, tried to
devise means to help developing countries get access
to modern technology at reasonable terms. As an
adjunct to this, the UNCTAD focused its attention on
the mechanisms of technology transfer, particularly
the role of Multinational Corporations, in the process.
A draft code of conduct for technology transfer was
developed by the UNCTAD in order to ensure that the
developing countries didnot face exploitation in the
global market place. This code has remained unratified
and developing countries face an ever deteriorating
inequity in the global system. At a time when the
initiative should have been to find ways to alleviate the
problems of the developing countries, Mr. Arthur
Dunkel, has proposed a new set of rules such that
GATT may now impose policies which would make
the developing countries incapable of pursuing their
larger development objectives. Fundamental changes
in the economic management can thus be expected
after the Uruguay Round agreement is reached. As
nations become subordinated to the GATT order the
implications may be far reaching.
Growing Opposition to the Dunkel Proposals
Opposition to the Dunkel proposals in India has come from ecomomists, lawyers, scientists,
activists, journalists, parliamentarians and now the farmers. The National Working Group on Patent
Laws was set up in August 1988 in the wake of the intense pressure on India to change its patent
laws. The Working Group through studies, seminars, meetings with Parliamentarians has gen
erated a lotof public awareness of the issues in GATT and created an informed opinion against the
Dunkel proposals. In early 1992 came the Gene Campaign, a network of individuals and organ
isations,launched toprotecttheThird World’sgeneticresources.TheGene Campaign organised
actions to protest government’s weak negotiating position on Dunkel proposals. Inashortspan
the Campaign's efforts gave further visibility to the adverse implications of extending patents to life
forms.
The growing opposition in India has also drawn attention to the vulnerability of Indian Constitu
tional Structure from the possibility of Indian Government deciding to sign Dunkel proposals. The
proposals touch almost every aspect of the economy from agriculture, to medicines, issue of
agricultural subsidies, industry and all of these are state subjects, which would come under
international discipline. Can the UnionGovernmentorfor that matterthe Union legislature assume
all the powers to totally disempower the state legislature in areas of their jurisdiction? In one stroke
the federal structureof the I ndian Constitution would collapse, these are thekind of concerns being
voiced in different quarters.
The most recent effort has been the'Seeds Satyagraha’launched by the farmers of Karna
taka Rajya Raitha Sangha when they served quit notices to 11 multinationals in Karnataka warning
them to keep their hands off I ndian agriculture. The farmers from all over the country are joining in
the movement. The resistance from these and several other concerned individuals and groups has
made its impact. But for such public pressure, Government would have long given in on the Dunkel
Proposals. In fact, within a fortnight of receiving the Dunkel Proposals it is understood that the
Ministry of Commerce was then preparing the Government to accept the package.
Together the mounting opposition has led to an increased awareness of the sinister designs being
fabricated at little-known forums like GATT. Efforts are being made to closley monitor the develop
ments so that vital interests of the people are not sacrificed.
In Defence of Sovereignty
In September 1991, more than 250 Members of Parliament besides many eminent citizens issued
a joint statement urging the Government to resist foreign (US) pressures on India to amend its patent
laws. The statement voiced the concerns of Parliamentarians across all political parties. They warned:
that not only our self-reliance and competitiveness was at stake, but also our parliamentary and
democratic institutions. "If the GATT framework dictated by the US was adopted, foreign monopolies
throughMNCs wouldgetentrenched in thecountrybothln production and trading
"TheMPs
sought a full scale debate in Parliament to arrive at a comprehensive and unambiguous approach to
the issues.
21
Impact on Indian Agriculture
he proposals presented by Arthur Dunkel, are
aimed at bringing about major changes in Indian
agriculture, with far-reaching implications for the peas
antry. The declared objectives of the Dunkel proposals
on agriculture arc to free the agricultural sector from all
forms of controls and interventions by the Government
and from all restrictionsonimports,so that the domi
nant Multinational Corporations (MNCs) in the agri
business find easy access to the markets of developing
countries, such as India.
T
Sweeping Changes
Changes are being sought on four fronts : (a)
lowering of subsidies given to various agricultural in
puts, such as fertiliser, electricity and water, (b) import
ing a given percentage of domestic consumption, even
if the country is able to meet its needs from domestic
production (c) introducing patent rights in agriculture
and (d) scrapping of priority sector credit programmes
that would directly affect agriculture. Though Indian
Government has declared that it has not as yet decided
on these proposals, a look at the recent agricultural
policies indicates that they are already being imple
mented, even before any formal acceptance.
For example, in keeping with the Dunkel propo
sals, subsidies to agricultural inputs were reduced to 10
percent of the total cost of production. Reduction of
fertiliser subsidy had been slashed in the 1992-93 budget,
resulting in a price hike of 30 to 40 percent The Indian
power sector has been under severe pressure from the
World Bank to increase electricity rates for agriculture.
The state power ministers conference in April last
agreed on aminimumrateof50paise per unit. Some
states have already effected the hike. Increased costs of
inputs would put severe strains on the poorer sections of
the agriculture community and would eventually lead
to greater degree of pauperisation.
22
Global Farms to Supermarket
Agribusiness companies are busy integrathg farms in underdeveloped countries to one
global food market managed by giants like
Keliog, Del Monte and others. The global
farms, occupying prime land, would serve the
global markets which
will have every item
priced at a level de-’
termined by what the
elites in the first and
the third world can
pay. What kind offoods would be pro
duced on these
forms? Certainly not
the staples needed by
the poor—beans,
millet, rice or ragi. But
luxury crops, fruits and
even flowers desired
by the rich. Thus plan
tations in Philippines
had been growing
bananas to cater to
the Japanese tastes,
pineapple plantation in Kenya were destined
for British consumers. Increasingly, produc
tion activity would be shifted to locations with
availability of cheap labour. Thus before
1975, 'asparagus' a luxury food, was grown in
Central California, later a good part of the
production shifted to Mexico. Two firms con
trolled 90 percent of this production, one of
which was the US Del Monte.
While such operations mean bigger profit
margins for the MNC, for the poor, their activi
ties have largely meant destitution and hun
ger. For instance, land that was contracted
by Del Monte on
highly concessional
terms once grew
.com, wheat and sun
flower seeds for lo
cal consumption in
Mexico. Crops for the
elite cornered funds.
and services of gov
ernment agricultural
programmes— aU in
the name of increas
ing exports. In Costa
Rica a 92 percent in
crease in its beef
exports to North
America were ac
companied by a 26
percent decline in
local beef consump
tion. IntroductionofSoyacultivationinBrazil
led to deterioration in the quality of local diet
as large, tracts of formerly food producing
land were taken up for such cultivation. And
yet more and more, developing countries
are today being advised to open up their ag
riculture to agribusiness interests in the name
of free trade,
The Controversial Wheat
The Government’s decision to Import 3 haste with which government is moving to
million tonnes of wheat —1.05 million ton throw the Indian agriculture into competition
nes from Canada, 1 million tonnes from with powerful multinationals — all In the
Australia and .9 million tonne from the US — name of free trade and modernisation. The
came in for sharp criticism in and outside the Prime Minister Is very eager to free the Indian
Parliament The controversy was sparked off farmers from the “artificial crutches" like sub
because of several reasons. For instance. It sidies and to make Indian agriculture more
was not clear what really compelled the
Government to buy wheat from international
market at a higher price (Rs. 517/- per quin
tal) to be paid in foreign exchange, when it
could have procured it from Indian market at
a lower price. Indian farmers, who were
demanding a remunerative price, were pre
pared to sell to the Government at Rs. 350 a
quintal. Why did the government choose to
spend precious foreign exchange worth Rs.
1500 crores, built mainly through borrow
ings when a severe foreign exchange crisis
was cited as the reason for going to the IMFWB ? In November ’92 farmers organisations
and political leaders protested the decision UTTER LIES’ OFCOURSE WE GIVE
by attempting to disrupt the unloading of the RtfWRMM PROCUREMENT FRIGE
wheat at port of embarkation. They protested
that inspite of a bumper crop the government TO FARMERS. RSKTKEAMtW'
had decided to invite international tenders
FARtW. WECAVE 11
>
for wheat Later in a symbolic defiance of the
ban on free movement of grain, wheat was
Courtesy : Laxman / Tha Time a of India
brought to Delhi and sold.
The winter session of the Parliament was
rocked by the controversy with almost all
opposition parties staging a walk-out on not
getting a satisfactory explanation. Was the
decision, a demonstration to the world farm
superpowers, of India’s willingness to liber
alise trade in agriculture ? Such fears cannot
be baseless especially in view of the unusual
profitable. What he Is forgetting is that it is
these crutches which the EC and the US have
relied heavily upon for establishing their su
premacy in world agricultural markets. And
even now, inspite of the so-called cuts, their
products would continue to be heavily sub
sidised.
Expressing grave concern over the con
sequences of the import of wheat, opposition
charged that the government had taken this
decision under pressure from multilateral
agencies. This theory gained weight when
the Agriculture Minister, Mr. Balram Jhakhar,
while admitting the impropriety of the deci
sion, in an internal note, clarified that the
Ministry of Commerce was instrumental in
the decision to import. Whatever may have
been the consideration, the decision signi
fies a dangerous drift towards reliance on
imported Food grains in a world where food is
often usea as a political weapon. In fact it is
understood, that an earlier request by the
government to the US for subsidised wheat
in early 1992 had been turned down, alleg
edly, because India was exporting rice to
Cuba. There were reports that some Indian
representative had met the US Secretary of
Agriculture in Washington to convince him
that India had in fact suspended export to
Cuba. There was much hue and cry on this
in the budget session of the Lok Sabha pn
March 4, 1992 with the government unable
to give convincing reply. If the trend to
import continues cultivation of foodgrains
may soon become an unviable proposition
with farmers switching over to cash crop
production. And with this, our ability to feed
ourselves with self-respect would become a
thing of the past.
According to latest reports a shipment of
50,000 tons of wheat from Houston, US has
been detained by Bombay Port health au
thorities on suspicion that it is infested I
23
Severe Curbs on PDS
The Dunkel draft also places strict restrictions on
the subsidisation of food, as in India’s public distribu
tion system (PDS). According to Dunkel subsidised
rations may be given to only those fitting certain “clearly
defined criteria related to nutritional objectives”. The
World Bank, in various reports, has been demanding
precisely the same. In line with these demands, the
1992-93 budget has severely slashed the food subsidy
(A 12 per cent cut in nominal terms i.e. after accounting
for inflation, a cut of over 22 percent). This will result
in a curb on the PDS itself. Moreover, the central
Government and various state governments have been
asserting that many of the beneficiaries of the PDS are
well-off, therefore, should be excluded from various
sectors from the rationing system. And accordingly, the
Central Government has chosen 1,700 blocks in back
ward areas to be the special focus of the rationing
system an indication of plans to curb or shut down the
rationing system in other areas - all in line with the
Dunkel proposals!
In order to prove somehow that the proposals spell
no harm to India’s agriculture, the Commerce Ministry
is resorting to different ploys. At times maintaining that
assurances by the GATT secretariat given in informal
conversations, convince that the proposals will not have
damaging impact and that these really do not apply to
India Is the government so naive not to know that it is
not verbal assurances that are important, what will ulti
mately remain is the document which certainly will
place severe limits on our ability to run our food
production system and public distribution system. Whom
to cover by public distribution will no longer be our
prerogative to decide and crucial areas of sovereign
space will be taken up by international discipline.
The Government has also been arriving at its own
calculations in an attempt toproveitspointe.g. while
calculating the existing level of subsidy to agriculture,
government figures relate to 1987 and since then fertil
iser subsidies alone have gone up considerably. Further,
24
------------------------------------------ --
WB Recipe for
Indian Agriculture
The Government has been deny
ing pressures from multilateral sources
as a consideration in the wheat Import
deal. But this Is not true. In fact, the
World Bank in the 1986 World Develop
ment Report expressed concern over
the huge operational costs, in terms of
cash subsidies, of running one of the
largest food distribution systems in the
world. The operational costs of hold
ing large buffer stocks, which in recent
years have increased dramatically, are
causing particular concern, accord
ing to the Report. An alternative ap
proach is then indicated by quoting
from a study by International Food Policy
Research Institute favouring greater re
liance on international trade in prefer
ence to building large cost-ineffective
buffer stocks. “A more liberal Import
policy would have allowed drastic re
ductions in the size of the buffer stock
needed to meet the same (price) sta
bilisation objectives." The point seems
to have been taken well by the Indian
Government. However, adherence to
the World Bank approach reinforced
by the new GATT rules would mean a
return to the ’ship-to-mouth’ agricul
tural economy.
some vital subsidies are not included in the govern
ments method of calculating but which are considered
by the Dunkel proposals. And even if today our level of
support does not exceed 10 percent, what would happen
if it does at some point in future? Will such proposals
not limit our policy making powers to provide support
to agriculture according to our priorities ? What is not
clear in all this, is why Government has so easily given
up articulating the nation’s vital interests and negotiat
ing to project these. Why is it going over-board to
convince about the innocuous nature of the Dunkel
proposals to the Parliament, placing only half truths ?
Dunkel proposals require the countries to maintain
the public distribution system only through purchase at
market price. This means the government cannot
interfere with theprice settlement mechanism, like it
candonow. The consequences of buying atmarket
price may not be so apparent in timesof plenty, but in
times of shortages, compulsion to buy at market prices
can mean suicidal for the country’s ability to procure
and stock food and release for consumption at sub
sidised rates. This in itself would be enough to push us
into a dependence on imports. The buffer stocks have
been critical in stabilising the prices of essential foodgrains.
Threat from Cheap Imports
The second threat for the agricultural sector would
come from the open competition with thecheap im
ports, largely from the granaries of the Western coun
tries. The Dunkel proposals stipulate minimum market
access for imports to be provided by the countries which
do not import foodgrains. India being only an occa
sional importer of food grains, would have to allow
imports. In the first year of implementation of the
Dunkel proposals two per cent of the country’s domes
tic consumption would have to be imported and this
figure has to go up to 3.33 percent at the end of ten years.
The implications of such compulsory imports are two
fold (a) domestic production would face competition
from the cheap imports provided by MNCs engaged in
agri-business, and (b) attempts by the country to achieve
self-sufficiency in food would be thwarted.
The penetration ofcheap imports cou Id lead to a
diversion of consumption from local products, resulting
in a greater dependence on imports. This would cause
(a) the uncertainty that comes with dependence on
imports and (b) the scarcity of foreign exchange re
quired to pay for imports. It is alarming that for various
reasons, the Indian Government has already entered
into agreements for imports of around three million
tonnes of wheat i.e. almost two percent of domestic
foodgrains consumption.
major seeds companies in the World today areMNCs
who trade not only in patented seeds but also in the
patented chemicals that would have to be used to obtain
best results.
The advent of biotechnology and the pressures on
developing countries like India to patent biotechnologi
cal innovations has given rise to the possibility that
domestic agriculture in these countries would be facing
dependency syndrome. Biotechnology has been pre
sented as the future technology for agricul ture and is
being developed in the laboratories of the MNCs. Claims
have been made (which are largely unsubstantiated)
that biotechnology has the potential of bringing about
Tkxing Agriculture
Between 1982-87, Japan extended
72.5 percent subsidy to its fanners,
European Community 37 percent
and the US 26.17 percent. Whereas,
India extended a negative subsidy
of 2.23 percent — i.e. India taxed its
agriculture.
Patenting of Life-forms
Introducing intellectual property rights (patents) in
agriculture would have far-reaching consequences. In
^redeveloping countries any improvement brought
about in the plant varieties are not considered as an
exclusive private property of the individual or organisa
tion undertaking this activity. Developed countries on
the other hand give exclusive rights to anyone develop
ing new varieties of plants or seeds for a definite period
during which he/she can use the monopoly rights to
exploit the market. This system, as prevailing in the
developed countries, is now sought to be forced on the
developing countries. If this system is adopted by the
developing countries, the farmers would get into a
serious problem as agriculture would be based on im
ported varieties as under the Green Revolution in India.
The use of seeds over which a patent holder may have
an exclusive patent right would create a permanent
dependency. Indeed the rights enjoyed by the owner of
the patented seeds are such that they do not allow the
harvested seeds to be sown for the subsequent years
production - every year the farmer has to approach the
company supplying the seeds to meet the requirements
Qf:
p/\T£NTEP COW WOULD BELOL/C WOT TO THE FARMER
BUT TO WB COMPANY WAT BRED WE COW
Courlgay : Sur.^. Sauxuu / PaUM Folly
---------------------------
25
Seeds Satyagraha
Farmers the world-wide are apprehen
1970 be left untouched. The Dunkel proposals
their labs, from seeds to bio-fertilizers and
sive about the manner in which free trade
will open upunlimited possibilities forMNCs
bio-pesticides. Cargill has been making tall
will threaten their livelihood and the food
security in their countries. In December 1992,
to market everything tha t canbe produced in
claims on the yield from its seed. These
claims ha ve been falsified by the experience
the Karnataka Rajya Raitha Sangha (KRRS)
launched what it calls 'Seeds Satyagraha' to
of KRRS activists in 8-10 districts of Karna
taka. While the multinational claims a yield
protect the farmers right to 'produce, multi
ply and sell' seeds. Warning the multina
of 16 quintals per acre, no where the actua 1
experience suggested thatitismore than5
tionals to stay away from their designs to
quintals and that too with greater inputs of
control Indian agriculture, hundreds of farm
ers, stormed into the Bangalore office of
fertiliser. Fearing that the Dunkel proposals,
if accepted would mean an end to self-reli
Cargill Seeds India Private Limited, destroy
ing the records and approvals for proposals
ance in food and agriculture, the fanners
have urged all state legislatures to initiate
ofinvestmentinlndia.CargillSeedsIndiais
debate on the implications, for agriculture,
the largest multinational preparing to cap
ture 25 percent of the sunflower seeds mar
which is a sta tesubject. 'India has an unpar
alleled infrastructure in agricultural research
ket in India. In 1992 it introduced its first
commercial product i.e. sunflower seed by
and it is to the credit of our scientists and
farmers that the country could come out of
the brand name 'Advance'. This seed is
marketed for Cargill by Rallis India of the
the humiliation of having to beg for food. At
no cost would the country's food security be
Ta tas. Cargill's research in India is targetted
allowed to be surrendered. The Government
at three other crops viz.—Sorghum, maize
and pearl millet (bajra).
The KRRS, in alliance with the Delhi
based Gene Campaign, have asked eleven
of India would beguilty of grave Constitu
tional misconduct if it signs any interna
tional treaty which impinges on the rights of
the states to legislate', warns Prof. N.D.
multinationals to quit or face consequences.
Nanjundaswamy, President, KRRS. With vari
These include Cargill, Pioneer Hibred,Ciba
Geigy, Sandoz- Continental Seeds, Hoechst,
ous other farmers' associations joining in the
struggle, the message of the well-orches
Merck. The farmers are stiffly opposed to the
entry of multinationals in the seeds sector
trated moves behind the new trade rules,
and demanding that the Indian Patent Act of
roots.
26
appears to ha ve already reached the grass
rapid increases in productivity in agriculture. But the
adoption of this technology would lead to permanent
strings of dependency on the MNCs.
Banking for Profits
The Dunkel proposals have yet another dangerous
implication for agriculture. The priorities of the financi al sector (banking and insurance) are being altered
through the new rules for trade in services which the
Dunkel proposals are seeking to introduce. Priority
sector lending, a policy in banking which many coun
tries like India have claimed to follow would have to be
discontinued. The agricultural sector, one of the major
beneficiaries of priority sector lending would be de
prived of funds. The initial suggestion for decrease in
priority sector lending leading toils ultimatediscontinu ation has come from the World Bank in its recent
report on the restructuring of India’s financial sector.
The Dunkel proposals have tried to reinforce the World
Bank recommendations. In order to project the World
Bankrecommendations, as itsown.theGovemment
appointed the Narasimham Committee on the Financial
System in its report submitted in November 1991 it
called for phasing out of the priority sector with an im
mediate reduction from the present 40 percent of lend
ing to just 10 percent. It is a matter of concern that
priority sector lending by banks for agriculture has been
much below target in 1989-90 and 1990-91.
The Dunkel proposals are thus a broader articula
tion of the changes that are already afoot to change the
inherent character of Indian agriculture. Demands have
been made for quite sometime that agriculture should
be given the status of an industry. This demand may be
fulfilled with the advent of the “corporate” Indian
agriculture, the consequences of which on the rural
populace may be catastrophic.
“While they (developed countries) are telling us that in
Africa you cannot subsidise the farmer, there is no country
in the western world that does not subsidise agriculture.”
Ghana’s Ambassador to the UN, 1991
Cadburys’
Vs. Farmers* Cooperative
The multinationals cannotstand competi
tion and they use every means, foul and fair, to
ehminateobstaclesinthewayoftheironeand
only one goal of maximising profits. The pur
suit of this goal may well entail destruction of
indigenous enterprises and loss of livelihood for
poor farmersas is illustrated in this case. More
than 70 per cent of the chocolate market in
India is controlled by Cadbury’s India? renamed
HindustanCocoa Products, asubsidiaryofthe
London-based multinational Cadbury. Among
the only two cooperatives that have attempted
to enter the chocolate market is the Campco in
Karnataka (Central Arecanut and Cocoa Mar
keting and Processing Cooperative). The ag
gressive measures used by the Cadburys to
undercut Campco have jeopardised the very
existence of this cooperative. First, the Cadbury’s
went in for all kinds of incentives for farmers to
take to wide spread cultivation of cocoa in the
mid 60s. These included distribution of hun
dreds of thousands of cocoa seedlings to farmers
in Karnataka and Kerala, supply ofsubsidised
fertiliser and above all attractive procurement
price for the crop. In just one year time the price
of wet beans (which stood at Rs. 5.50 per kg. in
1976) was more than doubled and fixed at
around Rs. 12/-in 1977 then to Rs. 14 in 1978.
The aim was to ensure a vailability of Cocoa for
its factory in Bombay. Forty procurement centres'
were opened all over South India and promotion
campaigns undertaken. The result was, phe
nomenal increase in the area under Cocoa cul
tivation — from 1927 hectares in 1970-71 to
6,980 in 1975-76 to 29,000 in 1980-81. This
increased cultivation, however, was at the cost
ofstaples such as tapioca. Having achieved its
immediate goal Cadburys’ slashed the procure
ment price by more than half in 1980—from Rs
14 per kg to Rs. 6.
The farmers instead of selling their produce
at the ridiculously low price set by the multina
tional, they cut down their crops, some fed their
cattle on cocoa pods. Nearly 30 percent of the
total cocoa plants had.been uprooted by mid-80s
in Kerala. At this point the Campco stepped in
by enrolling cocoa growers. Soon it became one
of the largest farmers cooperatives in India
with more than 42,000 members. Campco set up
procurement centres and later a chocolate fac
tory, at Puthur in Karnataka to avoid its de
pendence on export to international market
which was dominated by multinationals. Campco
was able to make a mark with a higher produc
tioncapacity thanCadburys’. With its product
selling at a lower price than Cadburys, it suc
cessfully challenged latter’s monopoly in the
cocoa and chocolate market.
Cadburys responded by bringing down its
product prices at par with that of Campco. It
also raised its retail commission to match
Campco’s 15 percent. Finally, it spent crores of
Rupees to step up its advertising. However,
when all these effortsdidnotdisplaceCampco
from the chocolate marketit hit upon a novel
scheme.
The Cadburys’ latest strategy for regaining
its control over cocoa market is the most aggres
sive. Itstarted by raising the price ofcocoaand
opened up more collection centres. Next it
launched an elaborate scheme, with the help of
the State Bank of Hyderabad. Under the scheme,
targeted at the farmers in Kerala and Karna
taka, who sell to Campco, the farmers hand over
their, produce every week at a Cadburys’ collec
tion centre for which they are paid. But the
farmers also sign papers authorising Cadburys’
to take loans in their name. This loan, which
runs into lakhs, is collectedby Cadbury’s from
the Bank. Cad bury s’ claim that this scheme is
necessary to raise finances to meet expenses of
cocoa collection at an assured rate. This, how
ever, is not true. In 1987 Cadburvs’ profits of
Rs.10.27 crores was double its profit in 1980.
The strategy really is to snare the peasants into
a debt trap and put Campco out of business
Efforts to expose the multinational’s hypocriti
cal concerns for local farmers and its manoeuvres
have not evoked much response from the au
thorities in Kerala.
27
Crisis in Global Agriculture
Cuts in Subsidies - Boon or Curse ?
The victims of subsidy battles between US and
EC were the developing countries who lost their
shares in world agricultural markets, while the shares
of deve-loped countries increased. Slump in world
sugar markets resulted from an aggressive farm support
policy pursued in the EC. Till late 1970s, EC was less
than self-sufficient in sugar. Today, massive subsidy
payments, have enabled it to become world’s largest
exporter dumping 4 million tons of sugar annually. It
continues a policy of overproduction and dumping,
causing severe hardship to sugar farmers and labour
ers from the Carribcan Islands to the Philippines. In
country after country, the devastating impact of the
dumping practices of the US and EC wereexperienced. Most seriously affected were Argentinian
exports of cereals and oilseeds, accounting for half
the country’s earnings, when their prices fell by 40
percent between 1980 and 1987 wiping an estimated
30 billion dollars from its foreign exchange.
Implications of a cut in subsidies in the EC whose subsidy on agriculture amounts to something like 200
billion dollars are being interpreted by the Commerce Ministry as a great benefit. A twenty percent cut in EC
would mean roughly 40 billion dollars subsidy less in the EC. This cut will get expressed in the i ncrease in prices
of internationally traded goods produced and exported through subsidies. This would mean a rise in prices of
temperate crops and not tropica! crops which constitute India’s export interests. The temperate crops include
edible oil, wheat, sugar, meat and milk product, fruits and vegetables. In edible oil we are not self- sufficient
Falling shares of Developing Countries
in Agricultural Trade
(Percentage)
Country
Beef Trade
OECD
Developing Countries
Sugar Trade
Industrialised Countries
Developing Countries
1970-74
1980-84
40
52
60
27
17
73
28
67
EC pays its farmers 180 dollars a ton to produce
wheat which it sells on the world market at 80 dollars
a ton. In three years US farm spending jumped from
'5 billion dollars in 1982 to 22 billion dollars in 1985.
By 1990, half of EC farm income was accounted for
by subsidies.
28
and still import a large part of our consumption.
Themarketaccesscompulsionandhigher worldprices will increase our import bill. Soalsoforsugar,
importing at the 1986-88 level would mean importing significant amounts of sugar. As for wheat rice and major
cereals, we are just about self-sufficient And depending upon, wliether it has been a good crop or bad we still
are on the threshold of importing. So in signing the GATT our negotiating position would be not only not as
net exporters but with the stagnant growth of foodgrains after a period of 15 years, we may even become net
importers. Thus higher world prices of these commodities will be to our disadvantage and not advantage.
Myth of Strong Patents
Impact on Pharmaceutical Industry
cceptance of Dunkel proposals on TRIMs, TRIPs
and GATS would mean gifting away the control
over vital sectors of our economy to the TNCs of the de
veloped countries. Almost every aspect of our lives
would be adversely affected. One of the sectors that
would be most severely affected is the Indian pharma
ceutical industry. The eighties have witnessed the
beginning of a reversal of the policy of self-reliance in
the field of pharmaceuticals. In 1985 Rajiv Gandhi
Government made a major and dangerous shift in the
economic policy. The policy favoured dismantling of
public sector, making entry of multinationals easier by
initiating aprocess of delicensing, decontrol and de
regulation. Drug policy of 1987 was bonanza for MNCs.
It announced that there would be no more public sector
units inthcdrugs and pharmaceuticalsector, as India
had already acquired self-reliance. Indian Drugs and
Pharmaceuticals Limited (IDPL) was thrown into com
petition with giant MNC firms. With import liberalisa
tion even intermediaries were allowed to be imported,
making IDPL and its different units go in the red
because of under-utilisation of their plant capacities at
different levels. Now the Narshimha Rao Government,
with its firm conviction in further liberalisation is
opening the flood gates to theentry of MNCs in a big
way. In thiscontext, Dunkel proposals onTRIPs will
cast the final nail in the coffin of the Indian drug
industry.
years, we have entered the international market. India
is today more or less self-sufficient in formulation
production, except for a few recently introduced life
saving drugs, which are imported. Around 65-70 per
cent of the bulk drugs are manufactured in the country.
New drugs introduced in the world markets are pro
duced locally at affordablepriceswithin3-4yearsof
their introduction. Prices of drugs of India, once among
the highest, are today the lowest in the world. Eg.
Zantac, a drug used in the treatment of ulcers, is made
by Glaxo. In India, the drug is sold for Rs. 29/- per ten
tablets, whereas in Pakistan ten tablets cost Rs. 220, in
the US $ 24 and UK £ 9. Similarly, Volatem produced
by Ciba Geigy is an anti-rheumatic drug which costs Rs.
5.67 for ten tablets in India. The same drug in Pakistan
is available for Rs. 47, in US for S 7.76 and UK £ 1.85.
There arc many new drugs whose patents have yet
to expire in the world but have been produced in India
through innovative and cost-effective processes. The
share of national companies in production has increased
substantially compared to the multinationals operating
in India. Over the years, India has started exporting
drugs to both developed and developing countries and
these are steadily rising. From Rs. 165 crores in 198384, the exports rose to Rs. 640 crores in 1989-90 and are
expected to go up to Rs. 1000 crores in next few years.
Developed countries to whom we export include the
USA, France, UK, Japan and tire former Soviet Union.
Indian Drug Industry
Contribution of Indian Patent Act, 1970
Drugs and pharmaceuticals is one area where India
has made remarkable progress. From being importer of
medicines in the first few decades after independence,
we are today able to meet a good part of our essential
requirement through indigenous production. Over the
The above achievements are impressive indeed.
An important impetus for the growth of the pharmaceu
ticals industry came from the Indian Patents Act of
1970. The earlier Act was reviewed for its impact on the
growth of industry, by expert committees. These
A
The developed countries argue that inade
quate intellectual property protection is a disin
centive for free flow of technology and conse
quently for growth in industry. However, a study
on the Turkish pharmaceutical industry showed
■ that the abolition of product patents for pharma
ceuticals in that country in 1961 cfcf not adversely
affect inflows of technology or foreign capital.
Indeed such inflows increased at a much faster
rate In that industry compared to other sectors
where patent protection was provided. Abolition
of patents on pharmaceuticals had no adverse
: impact on technology licensing arrangements or
on introductionof new drugs. Moreover, 82 percentof al! the products introduced following the
abolition of patents have been produced by the
locally-ownedfirmsthroughaccesstonon-patented technology.
Comparative Drug Prices (1988)
(Rs. Per pack of 10's)
Drug
Dosage
India
U.K.
Allopurinol
Atenolol
Cimetidine
Captopril
Dlltlazem
Haloperidol
Mebendazole
Naproxen
Nifedipine
Piroxicam
Ranitidine
100 mg
100 mg
200 mg
25 mg
60 mg
5 mg
6 x 100 mg
250 mg
10 mg
6 x 20 mg
150 mg
5.84
11.29
6.77
15.45
15.26
13.58
4.88
12.76
3.82
7.20
16.15
30.3
61.15
36.40
58.56
40.89
41.16
37.92
31.07
29.90
184.75
121.67
29
reviews produced evidence of the misuse of patent pro
tection by foreign companies to monopolise the mar
kets. It was found that more than 90 percent of the
patents in India, registered by foreigners, were not
being used in production within the country, thus deny
ing us access to the latest technology. The committees
recommended the urgent need to reframe patent laws to
make them subserve the goal of self-reliance in differ
entfields that independentlndiahadsetoutforitself.
The law was changedin 1970 and new Act came into
force in 1972. The main thrust of the Act was to ensure
that patents do not lead to monopolies for importation
and that these are granted to ensure that inventions do
get absorbed in the production process on a commercial
scale without undue delay.
Health being a vital aspect of life, drugs and chemi
cals were kept outside the scope of product patents
(which confer near total monopolies), only process pat
ents were granted. This exclusion has been critically
important in giving our scientists and entrepreneurs the
freedom to develop alternative processes for producing
cheaper versions of life-saving and essential drugs
within a short span of their introduction in the world
market. It has been possible for our drug industry to
produce above 100 bulk drugs precisely because of this
freedom. Thus the Act was fully in tune with our nationalnecdsandbalanced adequately the rightofthe
patent holder with national and consumer interests.
Safeguards were built into the Act by keeping the terms
of patent short to enable faster diffusion of technology,
by ensuring that patents registered in India were actu
ally used in production in the country. The Government
can grant license for local manufacture to any interested
party if the patent holder refuses to work the patent or
goes against public interest by unduly raising the prices.
Patents and Drug Prices
Top 500 companies ranked by Fortune magazinehadfatprofits inbigbusiness.Between 1981
and 1988 pharmaceutical prices in the US “rose an
average of 8.6. percent a year more than twice the
average increase in the consumer price index”.
Fortune magazine also found that the giant drug
MNCs “spend up to twice as much on sales and
marketing” as they do on research and develop
ment. Itnotedthatsomeofthemhad the “poorest
records of innovation” despite having virtual
monopolies with their product patents.
An American Senate Committee on Ageing re
vealed that several drug companies had not brought
a new drug to market in six years and one was still
recovering ‘investment on research’ on a drug that
had entered the market in 1938 1
Hoechst in India
Courtesy: KtshavlTht Hindu
30
The claims were subsequently falsified when
Supreme Court ruled that the multinational was
actually “profiteering.... in life saving drugs” .
"Without adequateexplanation, one
can only conclude that what is going
on in this (the pharmaceuticals) in
dustry is greed on a massive scale.
This is an industry that insists on in
creasing its profits at the expense of
the sick, the poor and the elderly."
Attacks on Self-reliance
It is provisions like these that enabled adaptation of
a number of drugs and led to the industry becoming
Responding to a charge of over pricing, Hoechst.
a German muftinational, in an advertisement in
the Times of India asserted its commitment to the
country end Its people pledging to follow the Gov
ernment policies (28th April 1986)
Hoechst was charging Rs. 24,735/- a tonne for
Baralgan Ketone produced by it, white the price
fixed by Government was Rs. 1,810/- a tonne, thus
making a mockery of Drug Prices Control Order!
Such commitment of the MNCs like Hoechst to the
country must have “impoverished us by hun
dreds, if not thousands, of crores of Rupees.”
—U.S. Congressman
<
.
.
J
Source : Asking the Earth, Winin Pereira & Jeremy
Seabrook.
competitive as reflected in the low prices of drugs. This
competi ti veness of thelndian drug industry has now
become a target of attack as evidenced in the pressures
on us to change our Patent Act. The Dunkel proposals
will mean a fundamental change in the patent law and
will take away the Government’s right to exclude
essential areas of life—health and food security — from
the scope of patentability, its authority to enforce work
ing of patents andmakeit, instead, the instrument for
protection of the rights of the patentees against the
interests of thenation and i is people. The effect of the
changed law would be to secure exclusive reservation
of markets for patented products by TNCs. The US, on
behalf of its TNCs, has been in the forefront of this
move, as it wishes to secure transfer of some 100 billion
dollars from countries like ours, as what it calls unpaid
royalties, to set its current trade deficit right. India was
placed under Special 301 on the priority watch list for
failing to protect intellectual property rights of US
firms. India is its largest trade partner in the third world
with a surplus of export of drugs and pharmaceuticals to
the US. While swearing by multilateralism, the US has
allalongresortedtobilatcralprcssurefor securingits
trade interests.
The Burden will be Crushing
If the burden of proving innocence* In case of Infringement Is shifted to the accused, ft will be Inimical
to the very spirit of our system of Justice. Quite aside from this, it will have catastrophic
consequences for the Indian industry. Say, If an Indian drug company is accused by an MNC of a
violation oi a process patent, it would be ths Indian company’s headache to prove it is Innocent
Dunkel Proposals Predict Disaster
□
a
What would be the implicationsofchange in the
Patents Act for the drug industry ?
All indigenous research activity for development
of new drugs and chemicals would come to a stand
still because of the increased royalties to be paid to
the patent holders, most of whom would be multi
nationals. Longer terms for patents would mean
that research would have to be confined to only
patent — expired products which in any case would
have become technologically outdated.
The incentive for Indian manufacturers to under
take production of new drugs would not be there, as
huge royalties would have to be paid to the foreign
imagine the plight of the companies If they constantly have to operate under the threat of being
accused. Imagine further, that the foreign companies with millions to throw on litigation, would
be able to buy the ‘services’ of the best of our lawyers to fight on their side. This has happened in
the past and today there would be no dearth of such patriotic Indians wanting to spin money at the
cost of their own country-fellows. This was so when Union Carbide hired the top-most lawyers to
appear against hapless victims of Bhopal gas leak, culminating in the most treacherous out-of-court
settlement— a mere $ 470 million for thousands of lives lost and many more wasted.
Reality of Patents
patenting pharmaceu
The battle for
tical products only
patent power Is,
when it already ranked
today, particularly
second in world pro
strong in the phar
duction of drugs and
maceutical sector.
controlled 80% of its
Many third World
market. Those indus
countries refuse to
tries
could not have
allow product patent
developed without ac
ing of drugs. They
cess to the technol
regard the develop
ogy. Only when focal
ment of their nation
industrial strength in
in this area as too
the field was certain
important. Intellec
and control of tech
tual Property Rights
nology had been al
are regarded as
ready acquired, were
more of an obstacle
patents allowed. With
than an incentiveto
export as the next
development. Most
step, patents were
OECD
countries
then viewed as desir
once thought this
able to capitalise on
way too. Patent pro
what
had
been
tection for drugs was
achieved. By insisting
allowed only after
on TRIPs in GATT
national industries
yesterday’s industrial
had become strong.
izing countries are
France only began
seeking to deny the
patenting drugs in
same route to devel
1958, West Ger
opment for the indus
many a decade later,
yp/y Kp&M£ WOULD CONFER
and Switzerland, PRODUCTPATENTS AND MONOPOLY OF trializing countries of
today.
leading pharmaceu-Source : GATT Briefings
tical corporations, in
^■°*iruay:
saivanupQltnt
on IPR.
1977. Japan started
32
patentees and that too if licensing for such produc
tion is permitted by the patentee. A number of
firms would have to close shop, also for fear of
being sued by the patent holding companies, wors
ening the unemployment situation.
The country will return to the pre-1970 days and
worse, when it would be dependent on imports not
just for patented raw materials but also for patented
finished formulations and drugs. The foreign pat
ent holding companies in pursuit of maximum
profits would favourdelayingindigenisationof
production for as long a period as possible. The
monopoly resulting from the situation would push
the prices high, to be dictated by the patent holders.
With the minimisation of government control over
the operationsofTNCs.theproduction of medi
cines would bear no relationship with the disease
pattern. The companies would target their prod
ucts at those who would have the capacity to pay.
Increased production of products like complan for
the rich, instead of anti-malarial drugs, needed by
the poor, would be the priority.
Lack of government control would also make the
Indian consumers vulnerable to banned, spurious
and hazardous formulations and drugs.
With the slow down of indigenous drug industry
export of drugs would receive a major blow, wors
ening the balance of payment position further. On
the other hand, greater imports would mean more
outflow of foreign exchange.
Some one third of total pharmaceutical products in
India are purchased by Government and govern
ment-aided health programmes. Due to sizeable
increase in drug prices the budgets of these institu
tions would go up several times. However, with the
axe of austerity already falling on such public
services, the out-reach of medicines through these
programmes would be severely limited. Already
the 1992-93 budget saw cuts in allocations for
government sponsored health care programmes.
A slow down of research and development in the
pharmaceuticals and chemical field would also
mean loss of opportunities for highly qualified
scientists, exacerbating the phenomenon of braindrain.
The strong lobby of drug multinationals — Organ
isation of Pharmaceutical Producers of India (O PPI)
along with the Indian monopoly sectors under ASSOCHAM and FICCI are pressurising the Government
hard to accept the Dunkel proposals as India’s last
chance to board the train of liberalisation. It is precisely
these interests which had earlier fought hard to stall the
changes in the patents law.
The Indian Drug Manufacturers Association (IDMA)
representing the indigenous industry is opposed to any
attempts to change the Indian Patent Act, which it feels
would be a catastrophe for the industry.
Government in a Mood to Give in
reopen negotiations it would stand isolated. Rejecting
the Dunkel proposals, which the Government sees as
the best it can hope for, is being seen as the end of
everything. The isolation theory does not stand the lest
of reality. If India takes the lead, a number of
developing countries would also be able to assert. On
the issue of IPR alone, there was and is massive
support thatlndiacouldhave cashed on both within
and outside the Third World. It could have mobilised
this support, especially in European countries, to
bring pressure on the US and other developed coun
tries within GATT. If NGOs with insignificant
resources at their command could build cross-country
and continent alliances on the issue of threatened
subjugation of the people to a Transnational order, why
could the Indian Government not have pressed its dip
lomatic missions into the job.of mobilising support for
the concerns of Third World in GATT? This question
is being raised.
Is the Government aware of the dangerous
implications of projecting its utter helplessness? Is it
seriously concerned about impact of Dunkel propos
als?
Now the negotiations at GATT are in the last stages
of conclusion, this is the only opportunity left for
the country to resist any attempts to interfere with
our prerogative to frame laws tailored to our needs.
The seriousness of the implications of the changes
being demanded has to be grasped fully before it is
too late. B
While denouncing Dunkelproposals on theonehand,the former UnionCommerce Minister
P. Chidambaram was engaged in putting upa Cabinet note advising theiracceptance!
But the Government already seems to be giving in
to the pressures of foreign firms and their Indian col
laborators. Prices of almost all the life-saving drugs
have recorded steep hike during last one year of the lib
eralisation policies. The new drug policy being shaped
by experts has recommended sweeping delicensing, de
control and deregulation and suggested increase in the
prices of drugs.
Reservation of certain drugs for production in
public sector units are being removed. Discrimination
between the Indian companies and foreign companies
will be removed to satisfy the demand for ‘equal treat
ment’ of foreign firms. FERA has also been dis
mantled. Compulsory quota of basic bulk drug produc
tion is beingremoved.Thechangeinpatentlaws will
deal the final blow.
Myth of Isolation
Indian Government and the votaries of liberalisa
tion have been creating a scare that if India tries to
33
Optingfor Unemployment and Chaos?
‘Working’ of a patent means using it in local
manufacturing which implies jobs for local people,
creation of related industries, utilisation of indige
nous materials and most importantly, acquisition
of technical know-how over time. An idea of what
would happen if the ‘unjust’ demands equating
importation with working of patent are accepted,
can be gained from this case (quoted in ‘Patent
Folly’ by P. Sainath).
In 1960, Bajaj Scooters entered into collabora
tive arrangement with Piaggio of Italy to manufactureVespainlndiatill 1971. As part of the agree
ment Bajaj could continue manufacturing and even
export scooters after the expiry of collaboration.
When Bajaj this. Piaggio accused Bajaj of imi
tating their design but because of Indian system
of intellectual property protection it could do noth
ing. Later Bajaj entered the then West German
market. Taking advantage of West German patent
system Piaggio filed suit in German court. A
technical committeeset up by thecourt could not
establish Piaggio’s charge against Bajaj, and yet the
German Court fined Bajaj 50,000 Deutsche Mark.
Bajajwas forced resettle thematterout-of-court
wasting time and money. Would the Indian firms
have such money and resources to survive long
drawn out litigation? In the proposed changes in IPR
the Government would lose the right to compel
foreignfirmsto manufacture locally, preventing
Indian companies from using their capacities. Not
just that, charges of violation could be brought
against Indian companies who may then be forced
out of competition and close their shop. This would
mean loss of several jobs, setback to export earn
ings, compulsion to import the patented product for
a longer time draining thereby the foreign exchange.
Can a country with 35 million un-employed afford
toopt for suchgrimposs ibilities?
Dangerous Stance
The views aired by our ministers en
dorsed by some over zealous bureau
crats are indeed pathetic. "... You
and your Secretary in the Commerce
Ministry have been at pains to explain
to all and sundry that the US authori
ties had to act in accordance with its
laws. But you have to appreciate that
we have to similarly act in accor
dance with Indian laws, if they come
into conflict with the laws of the US or
other powerful countries. We should
not be ever ready to adjust Indian
laws to conform to foreign laws and
subserve their interest".
Excerpt from open letter to P. Chidambaram
from National Working Group on Patent
Laws, 1991
Courtesy: Surtsh Sawant/Patent Folly
34
Trivialising the Implications
In an effort to project the innocuous nature of
Dunkel proposals, the Ministry of Commerce,
argues that price increase in drugs will not last
more than 10 years in most cases. However, a
longer-term viewofthesituation ismore unset
tling. Experts who have examined the issue in
depth point out that the effective lives of drug
patents would be extended and the expiry of a
patent would not lead to a fall in prices as hoped
by the Ministry. The loss of market share for
many brand name drugs, even after the expiry of
patentsissmall. This is because, brand loyalties
created by trademark laws operate so as to confer
a patentee with monopoly rights even longer than
the patent term. Moreover, it is not easy to
introduce competition m a market where mono
poly has been enjoyed for 20yearsor more by a
single firm. A study indicates that in the US the
effective life of patents on 1-3 billion dollars
worth of drugproductsranges upto 26 years of
market protection.
The Ministry, while allaying popular con
cerns on impact of TRIPs, says that the number of
drugs sold in India, which are on patent, are only
in the range of 10-15 percent. The reality is
different. An OperationsResearch Group Sur
vey shows the correct market shares of approved
drugs of major therapeutic groups, which are still
on patents in the US, but sold in India. These
are 42 percent for anti-biotics, 98 percent for
anti-bacterials, 70 percent for anti-leprotics,
66 percent for anti-ulcer drugs, 42 percent for
anti-asthmatics, 51 percent for cardio-vascular
drugs and 89 percent for contraceptive hormones.
The Ministry is, therefore, seeming to comfort
itself by taking a very myopic view of the drug
, situation.
Impact on Environment
ssive expansion in the scope of the GATT, under
Jruguay Round, could radically undermine the
commitment of the international community to envi
ronmentally sustainable development Deregulation of
trade in countless items, including limber, will thwart
national as well as global efforts to save natural resources
like rainforests and protect the rights of the native
peoples. Despite a strong environment protection
movement, the GATT has not shown any serious con
cern for the ecological consequences of proposals for
freeing world trade. The effect of unrestrained trade
could be far more disastrous in countries like ours
which do not as yet, have a very strong awareness about
environment nor the resources to promote environ
ment-friendly technologies.
M
Depleting Natural Resources
India, like most developing countries, has a natural
resource based economy. Last forty years of
‘development’ have seen an excessive use of these, re
sulting in their depletion to dangerous levels. Mindless
pursuit of economic activity and unplanned industriali
sation has already taken its toll on the environment The
competing demands of the economy havemadeour
cities unliveable with industries emitting smoke and
discharging dangerous effluents into the water systems.
The environmental costs of the Green Revolution are
now becoming apparent with vast tracts of land ren
dered unfit for cultivation because of waterlogging and
salinity. Out of the 75 million hectares classified as
forest land, less than half is actually under forest cover
and as much as 20 million hectares is affected by
erosion. No more than 12 percent of the country’s land
is under tree cover. Every year, deforestation renders
sensitive catchment areas in Himalayan and river valley
systems vulnerable to erosion, threatening the very
An Unwanted Guest
The efforts of Dupont, a US multinational, abetted by its Indian partner—theThapar
Group to seek backdoor entry for an outdated and polluting Nylon 6.6 technology have
succeeded, demonstrating once again the immense clout of TNCs. The approval of the
Dupont-Thapar project in Goa after a long persevering effort since mid-1970s, has come
even when there was massive opposition from the Goans and aGoa House Committee
Report recommending rejection of theprojectinviewof its threatto the fragile ecology of
the region. Inmorethan adecadetill early 1992, the US multinational used every means
at its disposal, to get the project approved. The House Committee Report held Dupont
guilty of irregularities in land deals requisitioned for the project, of exaggerating the benefits
from the project and for notincludingthe environmental costs. The project then involved
sending to Indiamachinesthatwerefirstinstalledin Richmond, USAin 1938! In pushing
its case', the Company decided to use an Indian public sector organisation, the Economic
Development Corporation, which helped notonly in getting licensesspeedilybutcompeiled Indian authorities to commit infrastructural support more readily than if Dupont went
alone. Dupont chose the Thapar-owned Ballarpur Industries Lid. to set up the project The
Thapars are an industrial house which has a reputation of helping MNCs to import second
hand machinery and passing it off as state-of-the art technology. An agreement which the
Thapar-Dupont Ltd. had signed on August 1988 for transfer of technology with Dupont
contained some very disturbing features. Taking a cue from the then litigations against the
Union Carbide in the wake of Bhopal disaster, Dupont inserted a series of clauses that
indemnified it absolutely from any liability that may arise from the plant. These included
clauses stating that TDL “shall hold Dupont and its representatives or assignees harmless
from any claims made in the Republic of India... alleging bodily harm or death.” Yet another
clause stated that “Dupont shall not be liable in any manner, whatsoever, to TDL or to any
third partiesforany loss ordamagecausedto person orproperty including themembers
of the public..,"
As a black-mailing tactic in October 1991, Dupont issued an announcement from its US
headquarters that Itwas shifting a proposed Dupont unitto Singapore, which had only a
week ago, received Union Government’s approval. The final approval of the TDL project
in 1992 by the Government of India has proved that the efforts of the multinational have
indeed yielded results.
35
THE
NICKEL
CONTROVERSY
It all began in September 1992 with leading newspapers reporting the findings of an analysis by Lucknow
'Y
(ERL), citing Indian chocolates as unsafe due to the presence of Nickel. High content of nickel was attributed to e process
.
ri>
genated vegetable oil (popularly called vanaspati) is used as a substitute for cocoa butter to resistthe tropical climat
ry.
While thefindingsofERLdidsendthechocolate industry intoaturmoil initially, itssympathisers, within and outside the Government, did notlose time
to come to their rescue.
. .
.
Included among the chocolate manufacturers were the Cadburys and Nestle. Within a week after the ERL findings were published, the Health Ministry
(Directorate General of Health services) swung into action, declaring that the popular brands of Indian chocolates were safe. This declaration was, curiously
at variance with an earlier action initiated by the Directorate to request Central Committee on Food Standards to examine the issue. The DGHS did not
wait for the outcome of its own directive.
Nor is the reaction of the Government too unfamiliar. Some six years ago, it had bailed out the vanaspati lobby by not acting to include nickel in the
list of toxic substances under the Preventionof Food Adulteration Act. This, inspite of the confirmation, that a number of brandsof vanaspati did contain
nickel beyond the safe limit. This time a more powerful lobby isat work to ensure that it comes out unscathed out of the controversy. And considering the
desperation with which Government is wooing foreign investors, such a reaction seems understandable. The reaction of the chocolate makers, especially
theCadburyswas typical. Denialsthrough advertisementblitz and press conferences!
The controversy would have died, but for the sustained efforts of Mahila Dakshata Samiti, as part of its programme to watch consumer interests. Under
pressure, Government, convened a meeting of experts on Novembers, 1992 to settle the issue. Apartfrom the fact that this meeting wasdominated by
non-toxicologists, it ended upby passing onthetask toan expertcommittee with six months given to itto submit its report. What it will doistostandardise
the methodology of estimation of nickel and establish the issue of its toxicity. The admission by the experts at this meeting that the country’s apex institution
does notyethaveastandardised methodology, calls intoquestiontheearlier assertionsof Health Ministry on thesafety of chocolates. DoestheGovernment really want to find the truth is the key question ?
GATT Ruling Portends Dangers
In August 1991, the GATT panelruled the US Marine Mammal Protection Acta violation of GATT. The US courts had used this Act to ban the sale
or import of tunacaughtbyamethod(purseseinenets)which resulted inslaughteroftensbfthousandsofdolphinseveryv'earGATTconsidered the
US lawasan ^illegal barrier totrade''.Thisdecislonraises^ryvitalquestionson the rehtionshipoftradeand environment, italsounderminesthc
sovereignty of nations to frame la wsdesigned to protect the environment and well-being of theircitizens
?e<^^^8W^^akeitP^k^ra^un^c^Uenge*elawsofanoihercountrypleadmgthatthesearebanaeret6trade.Ndr
canthe products of acountry.be discriminated agairot because of the particular method of its production even though the method may entail irreversible
rule the laws enjoying popular mandate as unfair trade barriers. That is, GATT would become a ci,iu a
paneiotthreeGAl it
ofaU laws with GATT rules.
become a supra-national body empowered to force harmonisation
36
existenceof millions. For the poor in India, environ
ment is not a luxury but a necessary survival base.
Forests, grasslands, rivers have been the source of life
and livelihood for tribals, nomads and fisherfolk. The
turn-around in the economy towards free market and
free trade will lead to a final assault on the already
stressed eco-system of the country threatening lire sur
vival of millions.
Export-Led Devastation
While we have yet to ratify Dunkel proposals, the
steps taken in the wake of liberalisation, indicate the
line our Government is likely to take on the proposals.
The mounting debt burden and widening trade deficit
are being given as reasons for recent cuts in tariffs,
casing of curbs on foreign investors, removal of restric
tions on imports and removal of subsidies. ‘Export or
perish ’ is the message that Government has been re
peating from all fora. “The world is not going to wait till
we meet our domestic demand and produce surplus for
exports. If the economics of the deals permit there is
nothing wrong in exporting even the same good we may
be importing”. These were the words of wisdom from
Mr. Pranab Mukherjee soon after taking charge of com
merce portfolio justifying the wheat import.
The boost to export for earning foreign exchange
will mean an even greater pressure on our natural
resources. More and more of these resources would be
directed to tradeable items rather than for local con
sumption. Already, more than 60 percent of our exports
arenatural resourcebased.These depend heavily on
primary commodities such as coffee, jute, timber, marine
products, ores and minerals. Since the social and
environmental costs are not covered in the price of
exports, such tilt towards liberalised trade will push the
country to an indiscriminate exploitation of these
resources.
With the Dunkel proposals taking effect, global
competition for agricultural output would intensify,
Trading the Environment
Third World countries would be obliged
to removeorseriously reduce restrictions on
investments by foreign companies. The lib
eralised trade rules would enable relocation
of hazardous industries in the Third World
countries where labour is cheap and envi
ronmental laws are lax. The possibilities of
industrial disasters like Bhopal would multi
ply many times and chances of bringing the
multinationals like Union Carbide to book,
reduced even further. Relocation of hazard
ous and polluting industries is indeed an
important agenda of the New World Order
where the TNCs reign supreme. This agenda
is being pushed through GATT by seeking
more and more freedom for TNCs and through
the World Bank by multilateral assistance for
ecologically unsound mega projects. And for
the World Bank this agenda was not even so
hidden when its former Chief Economist
Lawrence Summers in fact suggested to
senior World Bank staff".... should not the
World Bank be encouraging more migration
of the dirty industries to the less developed
countries?' Embarrassed about this, the Bank
did apologise for Mr. Summers remarks, but
the fact remains that it is already into the
business of financing relocation of polluting
industries to the Third World. It is this
thinking, says Dr. Vandana Shiva, which
supports the “emergence of an environ
mental apartheid in which the resources of
the poor are taken over by the rich and the
lives of the poor are considered dispensable
through poisoning and pollution.”
forcing us to bring more and more prime land under
cultivation to step up production for exports. Increasing
production would mean greater use of chemicals, pes
ticides, clearing more forests and opening up hitherto
protected stretches of land for enhancing exports. With
farmers beingcalledupon toearn foreign exchange,
massive shift to cash crop production is certain, drasti
cally reducing areas for staple food cultivation. Small
and marginal farmers, lacking resources to take to
export-oriented production, would be pushed out of
agriculture losing out to agri-business interests. Among
the several proposals cleared for foreign investments
recently, a large number of these relate to food process
ing. The elevation of agriculture to the status of industry
would displace small farmers, many of whom would be
compelled to encroach forest areas leading to further
deforestation. Export-oriented agriculture, being capi
tal intensive, will not be able to absorb the new entrants
to labourforce, many of whom would then swell the
ranks of the poor in urban slums.
Dumping of Hazardous Technologies
Removal of TRIMs will throw open all areas of
economy to MNCs. There is enough evidence to show
that hazardous technologies and processes of produc
tion will be increasingly shifted to countries like ours to
evade stiffer environmental regulations in the devel
oped countries. Weak environmental laws, their tardy
implementation and cheap labour force arc among the
most attractive inducements for MNCs to carry out
without hindrance their dangerous, but money-making
operations. “US chemical firms spend 44 percent less
on pollution control at their overseas plants than at
those inside thecountry” reports US trade magazine
Chemical Week. While the people affected by the
Bhopal distaster are still awaiting dispensation of jus
tice and continue to suffer, the likes of Union Carbide
wait eagerly to set up industries. Unchecked entry of
MNCs in the name of liberalised trade will mean many
37
more Bhopals. The restricted space for intervention by
the State would give greater freedom for the MNCs to
endanger public health and environment without hav
ing to fuss about any liability. In fact, even in thecase
of Union Carbide, it was entirely becauseof thecontinuous pressure from citizen’s groups and not the Gov
ernment, which led to a Supreme Court judgment
directing criminal proceedings against Union Carbide.
Threat to Genetic Resources
Removal of import controls, coupled with strong
patent laws, will make it easier for MNCs todump all
CIRCLE
kinds of products banned in developed countries. Strength
ened patents regime would particularly help them to
monopolise the Indian markets, especially for products
based on bio-technological research. A large number of
them are already poised to take control over the Indian
seeds market and with that the entire agriculture. Their
expensive hybrids would replace the indigenous varie
ties, making our agriculture even more dependent on
fertilisers and chemicals with their damaging effects on
soil. The patentingof lifeforms and processes would
lead to a faster erosion of our diverse genetic resources
for development of plant-based marketable products,
like foods, medicines etc.
OF
POISON
The world pesticide busin ess is controlled by the few multinationals of developed countries. A
numberof US companies are manufacturing highly dangerous chemicals which underthe US envi
ronmental laws, are prohibited for usedomestically. And yet these com panies are in the business of
producing these in the US for export to a number of countries, largely in the Third World. These
pesticides then return to the U S in the form of residues on imported foods, thus completing the circle.
For instance, heptachlor and chlordane are two insecticides (produced by Velsicoi Chemical
Corportion) banned for use in agriculture in the US due to their proven hazards to health; yet these
are exported to other countries. The poison thus affects the health and lives of people all over the
globe. The WHO figures show a million poisonings and 20,000 deaths a year due to pesticide
exposure.
In March 1990 the US Congress, introduced a bill to end this circle of poison which starts with
production in the US. This truly is a welcome development aimed at the root of the problem i.e. the
Multinational chemical companies. There are, however, some issues that remain a source of concern
in the contextof the current offorts by developed countries to liberalise trade, giving more and more
freedom to MNCs to operate any where in the world.
There is also a misplaced euphoria among the Indian Government about the increased export op
portunities that a liberafeed trade regime would unleash. It is misplaced, because, application of stiffer
sanitary and phyto-sanitary s tandards, on the exports from countries like ours, will in all likehood mean
that it will not be as easy for our exports to enter developed country markets, on the grounds that these
contain dangerous levels of residues of hazardous chemicals. Thus the kind of concern for public
health and environment as is. reflected in stiffer standards can only be termed as half-hearted. There
arenorulesbeingframedtoohecktheactivitiesofchemicalc'ompaniesinThird World countries like
India, which have made agric ulture acutely dependent on the use of their highly dangerous products.
Global health standards will no doubt strengthen more protectionism in the developedcountries.
38
The Indian government have been projecting that
the acceptance of Dunkel proposals in agriculture would
bring enhanced opportunities for export to developed
country markets. While seemingly opening up the markets
of developed countries, the proposals would cleverly
make this possibility increasingly difficult because of
the inclusion of Sanitary' and Phyto-Sanitary standards
that will be monitored by the reformed GATT. Thus in
the case of edible exports from developing countries,
environmental concerns could very well be used as non
tariff barriers.
Tourism is one industry where foreign service
companies are particularly interested. Environment will
receive a severe blow because of the indiscriminate
expansion of tourism and hotel industry with 51 percent
equity from MNCs. In Goa alone, 35 luxury resorts have
been given clearance in just last two years which
include projects of big multinational hoteliers like
Hyatt Regency, Holiday Inn, Kampinski Ramda. Tour
ism getting the status of industry means Government
can take over land in'national interest’ from local
fisherfolk. Theeffect of the luxury hotels on the sur
rounding environment will be disastrous. With massive
consumptionofwater each day to fill theswimming
pools of these hotels, wells of the local people in the
coastal villages will run dry.
Trading Environment for Dubious Gains
The new GATT agreement places trade over and
above national laws to protect environment. All our
environmental regulations, whatever worth these are,
would come to a knot.
Thus what we would be surrendering is the power
of the state to legislate for greater protection and con
servation of our forests and natural resources and pro
tection and safety of health and life of million.
Will our leaders, in their cunent euphoric mood
favouring wholesale liberalisation, stop to look at some
of these pernicious implications of liberalised trade
beforesigningonihcdottedlincs?
Downgrading Health Standards
The Uruguay Round final text section
on technical barriers and Sanitary and
Phyto-Sanitary standards (SPS) would
require nations to harmonise their stan
dards with international standards. Har
monisation, it is argued, by environmental
ists in the developed countries, is only a
euphemism for levelling off — generally
downward — of differing standards. What
is causing concern is that the GATT has
named Codex Alimentarius as the legiti
mate international agency to set standards
of food safety. Yet many standards that
this agency sets are much lower than con
sumer and environment standards in sev
eral countries. Eg. certain residues such
as DDT, long since banned in many coun
tries, are allowed by Codex standards.
Cbdex standards also allow greater con
centration of other pesticides.
The environment and citizens groups
are also gravely concerned that environ
mental policy making and norm setting is
being handed over to an unelected body
heavily dominated by corporate interests.
The US delegates to Codex include repre
sentatives of Nestle, Coca Cola, Pepsi,
American Association of Cereal Chemists
and others. No consumer groups or envi
ronmental groups are represented. The
pesticide committee of Codex has 197 par
ticipants. Of those who attended a meeting
in April 1991,50 were from agrochemical
companies, 14 from food and just two were
consumer representatives.
Export-led Destruction
Abuse of Corporate Power
Forests in Thailand have shrunk from upto
three-quarters to barely 15 percent of the
land area,allinamatteroffewdecadesof
"Modernisation" and export-oriented econ
omy.
□ Modem livestock breeds ha ve replaced many
village races and export cropping has come
to replace trad itional rice a nd mixed agri
culture with its variety of local food plants.
□ Increaseddemandsforpesticidesand fer
tilizers have driven fish out of Thai paddies
as a result of massive expansion of cultiva
tion in recent decades. More than one quar
ter of the land is affected by severe soil
erosion.
□ Following World Bank and the US Missions
to Thailand in 1950s, a huge increase in
agricultural clearance for non-rfce cash oops,
grown almost exclusively for export, led to
this invasion of natural resources.
□ Between 1950 and 1978, cultivation of cas
sava, maize, sugarcane and other crops,
overwhelmingly for export to Japan, EEC
etc. increased618 percents ttheexpenseof
around 50,000 Sq. km of upland forest.
□ Tiger prawn ponds have replaced abnost
half of Thailand's rich mangrove forests in a
decade for growing a single species. Pur
pose-catering to luxury seafood ma rkets
abroad with crippling effects on local fish
eries.
Sadly enough, this is not the fate of Thai
land alone, countries after countries in the
Third World are falling in this trap of exportled growth as part of the current globalisation
and liberalisation drive.
The Methyl-lso-Cyanate. the deadly gas
escaping from the Union Carbide Bhopal
plant on December 2-3, 1984 killed 5000
people, and left some 80,000 men, women
and children permanently disabled. By all
accounts, the Bhopal tragedy was not an
accident, but a disaster waiting to happen. It
represents the most shameful abuse of cor
porate power by a multinational to escape
responsibility for its omissions and commis
sions. After all kinds of delaying tactics to
tire the vicUms in their fight for justice, the
February 1989 out-of-court settlement
between the Government of India and the
Union Carbide was a victory for the multina
tional. It was let off in just $470 million
dollars as the cost for thousands of lives and
livelihoods lost. The settlement showed the
powerlessness of ‘State’ before the mighty
power of the company. The settlement also
precluded any further criminal proceedings
against the Union Carbide. However, the
resolve of the numerous citizens groups to
continue to fight the cause of the defenseless
poor, has over the years, yielded some results.
Recently the Supreme Court, while uphold
ing the payment of $470 million, directed
that criminal proceedings against the Car
bide may continue. It was also ruled that
children bom with genetic deformities to
women exposed to the deadly gas should be
included in the definition of victims. How
ever. even nine years after the disaster the
victims continue to suffer and run from pillar
to post awaiting dispensation of justice. And
yet open invitation to multinationals with
lesser regulatory mechanism, can only mean
invitation to more such disasters.
□
39
Genetic Resources Action International
Apartado 23398,08080
Barcelona
SPAIN
Phone: (34) - (3)-302-64-95
Contact: Mr. Hcnk Hobbelink
8.
The Council on International and Public Affairs
777, United Nations Plaza, New York
NY 10017, USA
Phone: (l)-(212>972-98-77
Contact: Mr. Ward Morehouse
4.
European NGO Network on Agriculture and
Development (RONGEAD),
14, Rue A Dumont
69372 Lyon Cedex 08 France
Phone: (78)-61-32-23
World Focus—Monthly Discussion loumal. No.
150, June 1992 - On Dunkel Proposals: Questions
of Economic Sovereignty.
Contact: M-13, South Extension, Part II
New Dclhi-110 049, India
5.
Patent Folly:BehindtheJargonon Intellectual
Property Rights—by P. Sainath
Contact: Thclndian School of Social Sciences,
Bombay, 5-E ENSA Hutments, Mahanagar Palika
Marg (Near Azad Maidan), Fort, Bombay^OOOOl.
India
6.
Multinationals and the Environment—Indian edi
tion of a paper written for Greenpeace Interna
tional
Contact: Third World Network, A 60, Hauz Khas
New Delhi - 110 016, India
7.
Fixing the Rules: North-South Issues in Interna
tional Trade and the GATT Uruguay Round—
Kevin Watkins
Contact: Catholic Institute for International Rela
tions,
New North Road, Unit 3, Canonbury Yard, 190 a,
London N17BJ, UK
8.
GAIT Briefings—(Agriculture,Environment,
Trade in Services,TRIPs,etc.) published by the
European NGO Network on Agriculture and De
velopment (RONGEAD)
9.
World Rainforest Report—the quarterly magazine
brought out by the Rainforest Information Centre
Contact: The Rainforest Information Centre,
P.O. Box 368 Lismore 2480, N.S.W., Australia
Resources
number of NGOs, citizens groups and networks
have been actively building awareness andcampaigning against the attempts at GATTto restructure
world trade rules in favour of TNCs. Some useful
addresses include:
A
1.
2.
3.
National Working Group on Patent Laws,
79, Nehru Place, New Delhi-110 019,
INDIA
Phone: (91)-(011)-6415089
Contact: Mr. B.K. Keayla, Convenor
Gene Campaign, F-31, Green Park Main,
New Delhi-110 016, INDIA
Phone:.(91)-(011)-655961
Contact: Dr. Suman Sahai, Convenor
Karnataka Rajya Raitha Sangha
2111,7A Cross, IH Main Vijayanagar
II Stage, Bangalore - 560040, INDIA
Phone: (91) - (0812) - 302171,300965
Contact: Prof. M.D. Nanjundaswamy, President
5.
Third World Network
87, Cantonment Road, 10250 Penang,
MALAYSIA
Contact: Martin KhorKokPeng
6.
9.
10.
Seeds Action Network Asia,
105, Rajpur Road,
Deharadun - 248 001, INDIA
Phone: (91) - (135) - 23374
Contact: Ms. Vandana Shiva
4.
Consumer Interpol, International Organisation of
Consumers Unions (IOCU)
P.O. Box 1045,10830 Penang,
MALAYSIA
Contact: Dr. Martin Abraham
□ A Commitment in Defence ofIndian Patent
Regime
■ GATT Negotiations: Economic Sovereignty
in Jeopardy
n Dunkel’s Draft Text: Indian Agriculture
□ Patent System and Related Issues at a Glance
□ The Real Eace of Dunkel: Issues before Par
liament
7.
Institute for Agriculture and Trade Policy
1313 Fifth Street SE Suite 303
Minneapolis, MN 55414 US
Phone: 612-379-5980
Contact: Mark Ritchie
Material of Interest
1.
2.
BIJA—the news monitor of the national Campaign
on bio-diversity, bio-technology and patenting of
life forms
Contact: Bija, Researach Foundation for Science,
Technology and Natural Resources Policy, Dehradun.
Publications of Third World Network
□ The Uruguay Round and Third World
Sovereignty—by Martin Khor Kok Peng (1990)
□ Dossiers on the Uruguay Round—(reports
and analyses on the negotiations)
□ Third World Economics—a fortnighdy maga
zine on the Uruguay Round and other
economic and financial issues.
3.
Publications of National Working Group on Patent
Laws
OUR PUBLICATIONS
1.
2.
3.
STRUCTURAL ADJUSTMENT : WHO REALLY PAYS ?
THE GREAT SURRENDER
ENOUGH IS ENOUGH
by Davison L. Budhoo
4. SARDAR SAROVAR PROJECT
Report of Independent Mission
5. THIN BLACK LINES
(A Compilation of nearly 90 cartoons on the Indian Economy,
IMF, Globalisation, etc.)
6. OCCASIONAL PAPERS
(i) FINANCIAL SCAM : WAGES OF DEREGULATION
by Arun Kumar
(ii) RATIONAL CRIMINALS, CARPET BAGGERS AND
THE SCAM
by Dalip Suiamy
(iii) DISINVESTMENT OF PUBLIC SECTOR :
A COLONISATION WITHOUT OCCUPATION
by Ashok Rao .
7. BEYOND THE JARGON
Glossary of terms such as MNCs, IMF, GATT, TRIPs, etc.,
in English and Hindi
8. POSTERS ON IMF, WORLD BANK AND INDIA
(i) JUST SAY WHAT YOU MEAN
(ii) NURSERY RHYMES OF OUR TIMES
(iii) NEW ‘WORDS’ ORDER
(iv) THE BIBLE OF DEBT
Rs. 15
Rs. 5
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9. SCAM FOR BEGINNERS
10. GHOTALE MEIN GHOTALA
A popular booklet on the recent financial scam and its
fallout, in Hindi
by Abhay Kumar Dubey
11. FOR YOUR EYES ONLY
A Compilation of cartoons on Ayodhya crisis, published
by Media Watch
12. THE PROTEST MARCH
An action-alert on the workers’ march to Parliament in
November '92
13. THE CONTROVERSIAL WHEAT
An update on the impact of wheat import on Indian agriculture
14. SEEDS OF PROTEST
A booklet on the recent attack by the farmers
at Cargill office in India
5
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Public Interest Research Group is a research
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