Now the situation after the establishment WTO that too with the TRIPS provisions is definitely getting worsened. Eight companies were controlling more than 50 percent of plant patents in Europe prior to the establishment of WTO. And, now, just 4 companies own nearly one third of the total plant bio-tech patents in the world. The WTO by legitimizing the liberal export subsidy provides further impetus to TNCs to tighten their grip over the global trade in agriculture. For instance, as per the FAO's estimation, top five TNCs who receive maximum amount of export subsidy are together controlling almost 95 percent of wheat trade in the world. In the case of coarse cereals the figure is 22 percent. The large scale takeovers and mergers of the TNCs at the global level which is happening in the recent days further increases the concentration in the market for agricultural commodities. These mega global companies when get in to the individual countries will virtually assume the position of the monopolies. For instance through the takeover of Cargil and few other seed companies and collaboration with the local companies like Mahico, the Monsanto, is emerging as the monopoly seed supplier in India. It is a great irony that the WTO came so heavily against the State Trading Enterprises which are operating on socio-economic considerations to meet food security commitments keeps an absolute silence on TNCs who are assuming virtually the monopoly power to further their unbridled commercial interests and abnormal profit motives.

In contrast, agricultural production in the Third World is characterized by a 'perfectly competitive' market situation. As per the basic economic doctrine, competitiveness or otherwise in the production or marketing of a particular commodity is determined by the number of 'actors' involved in that process and the extent to which these actors 'influence' the price of that commodity. Ideally speaking, in a perfectly competitive market situation, price and production of a particular commodity are determined completely by the free market 'forces' i.e. demand and supply of that commodity. The individual producers should not have any influence on them. This ideal market situation avoids imperfections in any forms such as the over charging, abnormal profiteering, inadequate supply and so on. The production in the Third World agriculture precisely qualifies this condition. Several thousands of farmers by simply responding to the requirements of the society are supplying food grains at the 'given' prices determined in the market. Contrary to this, a monopolist is a 'price maker', with an 'abnormal' profit motive, who decides 'what' and 'how much' of a commodity to be produced. Such a market is an imperfect one, and hence is not desirable from the point of view of the economy as a whole. The small support which the Third World farmers receive are too 'peripheral' to impinge upon, the overall competitiveness of its agricultural trade. The competitiveness that is prevalent so evidently in the Third World agriculture starts eluding slowly in the 'imperfect' domestic agriculture market. The competition ceases to exist at the global market for agricultural commodity which is concentrated in the hands of a few private monopoly TNCs. The greatest flaw under the WTO discourse is its inability to recognize and reward this feature of competitiveness inherently built in the Third World agriculture.

Compared to Third World, the agriculture in the developed world is more 'controlled' and hence less competitive. Due to 'unrestricting' the scale of operation, as there won't be any ceiling limit, agriculture in the developed world enjoys the 'economy of scale', followed by the capital intensiveness, mechanization and high degree of commercialization. Due to the virtues of these features, producers in the developed world could exercise considerable influences on the supply and hence, on the price of their produces. Under such a circumstance, any subsidy and support given to agriculture have definite 'distortionary' effects on the overall trade of agricultural commodities. Hence, it is very inappropriate to compare the small support given to Third World agriculture with the huge trade distorting subsidies given to agriculture in the developed world. A distinction should have made between the domestic support given to meet food and livelihood security purposes as opposed to purely trade distorting subsidies given to farm products in the developed world meant exclusive for export trade.

Now, it is becoming increasingly clear that the WTO which was established 'by the West' has become predominately 'of the West' and will remain mainly 'for the West'. The clear lesson from almost one decade of experimenting with the so called trade liberalization is that the developed world will continue, at any costs, the subsidies to their agriculture. The accord reached just prior to Cancun summit, between the two trade giants, USA and European Union clearly shows how on this issue they are not ready to compromise. The USA agreed with EU on Blue Box provision (where most EU subsidies are) and EU is ready to support USA for the Amber box de minimis (where US huge farm supports lie). In the mean time the accord gives unlimited scope for supporting the agriculture through Green Box provision. Ultimately, the US will persuade the EU to phase out gradually the moratorium and stiff resistance for genetically modified food at Europe. In this circumstance, the peasant organizations, serious NGO' and civil society representatives have been demonstrating their opposition to WTO effectively. Before embarking the extreme and the hard step of outright rejection of the accord, it is advisable, to look at the scope for a negotiation by clearly fixing the position of the Third World to preserve the food sovereignty option.

1. A Food Sovereignty Box to strengthen the rights of the nation states to develop their agriculture and to eradicate inequality, unemployment, poverty, malnutrition and hunger. The box should be totally insulated against the trade rules and WTO disciplines to undertake the measures on the followings: Achieve the self sufficiency in food requirement at the country level so as to protect the livelihood security of the peasantry, food security of the poor and health as well nutritional security of the common masses.
Protect the rights of the farmers; including the women and indigenous communities over land, water, forestry, livestock, genetic and common pool resources.
To protect the environmental sustainability of agricultural production, biological diversity and the associated traditional knowledge and technology system.

As above concerns are independent of the trade issues, the WTO must make a sincere attempt to undo the excesses committed in the past in this regard. In addition, it is very essential to assign increased roles for United Nations' organs such as the Food and Agricultural Organization (FAO), United Nations Conference on Trade and Development (UNCTAD) and United Nations Environmental Program (UNEP) to strengthen the proposed Food Sovereignty Box.

2. An Adjustable Trade Rules and Tariff Structure: The contribution of the trade in agricultural commodities to the overall economy differs from country to country. For instance, for countries like China and India, with a big domestic market and the largest population to feed, the export of food grains may not be an ideal option. Similarly, with the vast arable lands and varied climatic conditions, these countries are in a position to achieve the self sufficiency in the requirements of all most all agricultural commodities. The agricultural trade can performs only a fringe role through the export of 'surpluses', in these countries. Economies of countries like Uganda, Colombia and Ethiopia, on the other hand, are depending heavily on the export of a single commodity like coffee. Hence, a fair agricultural trade is very crucial for the very survival of these countries. In the case of Sub Saharan African countries, easy import of food grains is very critical to address the food security objective. And finally, for the Cairn group countries, agricultural export plays a major role in the economic growth and prosperity of their nations. Hence, the trade rules must be made flexible enough to accommodate the varied concerns of individual nation with regard to trade of agricultural commodities.

Similarly, the tariff regime also should be adjustable enough to accommodate the Third World concerns. For instance, in a country like India farmers have to undertake the production under several socio-political 'restrictions' and regulations such as the land ceiling (to comply with agrarian reforms) , levy system of pricing and procurement (to comply with the food security objective), Minimum Wage Act and so on. In addition, Third World agriculture is also rich with bio-logical diversity and traditional knowledge and hence, is complying with the 'conservation' objective also. This is precisely the "multifunctionality" of Third World agriculture. Contrary to this, agriculture in the developed world is unrestricted and free from any such socio-political obligations. In addition, due to intensive use of chemical inputs, the developed world's agriculture is a polluting and resource depleting one. To correct this glaring discrepancy, the Third World peasantry should be compensated with sufficient supports and subsidies for the multifunctional roles performed by their agricultural systems. In addition, a tariff 'equivalent' to 'suppress' the adverse impacts of developed world's import on the Third World agriculture is also very essential.

However, the tariff, being purely a market based instrument, may be amenable for political maneuvering. The case of edible oil in India is an example for such maneuvering. India with the production of around 220 million tons during 1997 has achieved near self sufficiency in edible oils. Due to the pressure from domestic merchants and manufacturers, the import duty on edible oil was reduced from 65 % to 16.5, (in spite of a provision to raise up to 300 % !). This facilitated the flooding of cheaper oils; sunflower, Soya and palmolein, from USA, Malaysia, and Indonesia causing a death knell to around 5 million domestic farmers producing oilseed and more than two million worker in the oil extracting industry in India (Prakash, 2001). Hence, the Third World governments must always keep the option of Quantities Restriction (QRs) open in this regard.

3. Alternative Reward System instead of the Present IPR Regime: The present system of Intellectual Property Rights (IPR) introduced in the context of GATT is a narrow and highly restricted one. It is the Trade Related Intellectual Property Rights (TRIPS) which aims at only super profit through a imperfect market structure like a monopoly created by the TNCs. that is before us. Hence, an alternative IPR system which gives equal importance to 'collective intellectual property rights' with adequate focus on the Third World's treasures such as biological diversity, traditional knowledge and the creativity as well as the innovation of the grass roots people need to be established. In addition to sheer property rights, a system of rewards in both material as well non-material forms at the individual and collective levels need to be established to augment creativity and innovations at an unlimited scale to usher the well being of humankind. The UN bodies such the World Intellective Property Organization (WIPO) has to be empowered enough in such a imitative.

4. Counter Offensive to TNCs Power: The STCs like Food Corporation of India and co-operatives like AMUL (Anand Milk Union Limited) in India need to be strengthened as counter offensive forces to TNCs. As these STCs and co-operatives are capable of providing an effective competition through a bigger 'scale' and resources, to TNCs, they enhance the true sprit of a fair trading system. In addition, they are also capable of addressing the food and livelihood security issues effectively. Hence, they deserve all the supports from the governments.

And, finally, India and China must join hands in mobilizing the support of other Asian countries to protect the region's food sovereignty base. Until a proper atmosphere for negotiations, on the lines discussed above is created, the option to keep agriculture out of WTO's purview may be considered seriously .

Dr. T.N. Prakash Kammardi is working as Associate Professor of Agricultural Economics at University of Agricultural Sciences, Bangalore,Karnataka. Currently he is on study leave to pursue Post. Doctorate Research at University of Bonn, Germany.
Responses can be emailed to prakashtnk@yahoo.com

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