Voluntary Report - public distribution

**Date:** 12/30/2005

**GAIN Report Number:** IN5135

IN5135

**India**

**Agricultural Situation**

**Weekly Highlights & Hot Bites, #48**

**2005**

**Approved by:**

![](media/image1.wmf)Michael Riedel

U.S. Embassy, New Delhi

**Prepared by:**

A. Govindan, V. Shunmugam

**Report Highlights:**

\*Indo-US Agriculture Knowledge Initiative to push trade\*, \*Andhra
Pradesh to claim against Monsanto over Bt cotton royalties\*, \*India to
push for removal of non-tariff barriers\*, \*Cabinet clears
implementation of South Asia Free Trade Agreement\*.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

New Delhi \[IN1\]

\[IN\]

Welcome to Hot Bites from India, a weekly summary of issues of interest
to the U.S. agricultural community. The report includes information that
has been garnered during travel within India, reported in the local
media, or offered by host country officials and agricultural analysts.
Press articles are included in this report. Significant issues will be
expanded upon in subsequent reports from this office.

DISCLAIMER: Any press summary contained herein does NOT reflect USDA's,
the U.S. Embassy's, or any other U.S. government agency's point of view
or official policy.

**INDO-US AGRICULTURE KNOWLEDGE INITIATIVE TO PUSH TRADE**

The U.S. government and industry seem to be using the Indo-US Knowledge
Initiative on Agriculture (KIA) to push trade issues. The Indian team,
which just retuned back from the first KIA Board meeting in the United
States, found that two "strategically chosen" US private industry
representatives (Wal-Mart and Monsanto) were interested only in trade
issues. The Indian Council of Agricultural Research chief Dr. Mangla
Rai, who led the Indian team, says that while the United States may be
looking at forging alliances for future market openings, the KIA is
primarily a "knowledge initiative." The two sides will focus initially
on four areas: education, learning resources, curriculum development and
training; food processing and use of byproducts and bio-fuels;
biotechnology; and water management. (Source: Times of India, 12/28/05)

ANDHRA PRADESH PLANS TO CLAIM AGAINST MONSANTO OVER BT COTTON ROYALTY

Following complaints from farmers' and people\'s representatives, the
state government of Andhra Pradesh plans to ask the Monopolies and
Restrictive Trade Practices Commission (MRTPC) to move against Monsanto
regarding their \"exorbitant\" technology fees. Seed companies that
collect the so-called \"technology fees\" from the farmers were also
made respondents in the case to be filed before the MRTPC on January 2,
2006. Over the past three years, Andhra Pradesh farmers have purchased
Bt cotton seeds worth \$28.6 million, of which \$17.2 million reportedly
went to Monsanto as royalties. The Andhra Pradesh Agriculture Minister
indicated that some other states may also join his government in this
case. (Source: Business Line, 12/29/05)

**INDIA TO PUSH FOR REMOVAL OF NON-TARIFF BARRIERS**

Commerce and Industry Minister Kamal Nath, during his interactions with
editors and economists to discuss the Hong Kong WTO ministerial meeting,
said that India would push for the abolition of non-tariff barriers
imposed by developed countries on imports of both agricultural and
industrial goods. He would also like to end the "misuse" of anti-dumping
provisions in the ongoing negotiations of the Doha round. Speaking at
another seminar on "Trade, Globalization and WTO: Hong Kong and Beyond,"
organized by the Federation of Indian Chambers of Commerce and Industry,
Mr. Nath said that the outcomes of Hong Kong would ensure India's
concerns in agriculture and industrial goods will be addressed. He
further stated that the Special Products and Special Safeguard Mechanism
secured in Hong Kong would fully protect the interests of the country's
farmers. (Source: Business Standard, 12/27/05; Business Line, 12/24/05)

**CABINET CLEARS IMPLEMENTATION OF SOUTH ASIA FREE TRADE AGREEMENT**

The Indian Cabinet on December 29 okayed the implementation of the South
Asia Free Trade Agreement (SAFTA), with effect from January 1, 2006. The
basic objective of SAFTA is to reduce existing tariffs in order to boost
trade among member countries of the South Asian Association for Regional
Cooperation (SAARC), which include Bangladesh, Sri Lanka, Nepal,
Pakistan, Bhutan, Maldives, and India. However, agricultural tariff
lines have been kept in India's Sensitive List (Negative List) under
SAFTA, which means that SAFTA's Trade Liberalization Program would not
apply to them. India's total trade with SAARC countries was \$5.2
billion in Indian Fiscal Year 2004/05 (Apr-Mar). (Source: Press
Information Bureau, Government of India, 12/29/05)

# RECENT REPORTS SUBMITTED BY FAS/NEW DELHI

  ----------- --------------------------------------- -------------------
  **REPORT    **SUBJECT**                             **DATE SUBMITTED**
  \#**                                                

  IN5132      Weekly Highlights & Hot Bites, #47      12/23/05

  IN5133      Oilseeds Monthly Lock-up Report --      12/30/05
              January 2006                            

  IN5134      FAIRS Product Specific -- GOI Publishes 12/29/05
              Draft PFA Rules Amendment Regarding     
              Labeling of Packaged Food               
  ----------- --------------------------------------- -------------------

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