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EU-India FTA to adversely impact agriculture, livelihoods, health: FAFTA

News Worms

EU-India FTA to adversely impact agriculture, livelihoods, health: FAFTA

3 May 2010

A beleaguered UPA Government reeling under pressure from a united opposition on rising food prices, came under further attack from a coalition of groups representing farmers unions, trade unions, hawkers, public health and other civil society organisations on the ongoing, secret negotiations on a European Union–India Free Trade Agreement (EU-India FTA). In a demonstration organised under the banner of Forum Against FTAs' outside the Commerce Ministry, groups protested against the last round of negotiations between EU and Indian bureaucrats currently underway in Brussels. Reports from Ministry sources indicate that the FTA will be signed in October 2010. The Forum's repeated requests for access to information and genuine discussion in the Parliament and the States on this FTA have gone unheard. "The negotiators should have the mandate from the Indian Parliament and the State governments for these negotiations. So far the state governments have not been consulted and genuine discussion has not taken place in the Parliament," said Manicandan of the Forum Against FTAs secretariat. Supporting the Forum's demands for transparency, Commonwealth Human Rights Initiative stated that "with the operationalisation of the Right to Information Act, the UPA government is duty bound to share information with the civil society and general public while formulating important policies. FTA is an important trade policy and all facts and figures relating to FTA negotiations must be shared with people by law". Outlining their concerns on various sectors, the groups highlighted the baffling manner in which the provisions of the FTA related to agriculture were being negotiated. The FTA leaves the large subsidies that the EU gives to its farmers virtually untouched but calls for a 95% reduction in India's import duties to virtually zero.This will hit the Indian agricultural sector hard impacting lives and livelihoods dependent on it. In addition the services and investment chapter of the FTA will make the entry of European agro-processing and retail firms easy thereby impacting how food is produced and sold in our country. Small and marginal farmers, processors, distributors and retailers in India will be pitched against the power of multinational retail firms’ said Yudhvir Singh of the Indian Coordination Committee of Farmers Movements.

The demands on the financial sector would make it difficult to control the rapid influx and exit of risky investors, a major reason for the financial crises around the world. In the wake of the global financial crisis, a serious rethinking on opening financial services must take place. The crisis has de-legitimised the "best practices" of European banks and calls for an expansion of the domestic regulatory space not its restriction as the EU is demanding," said Kawaljit Singh of Madhyam. The negotiations on the EU-India FTA have also led to increasing concern on the TRIPS-plus demands being made by the EU and their impact on access to medicines.India has taken the lead in the developing world in balancing public health needs with intellectual property rights. The EU’s demands for TRIPS-plus intellectual property rights threaten this critical balance and would lead to legislative and policy changes in India that will undermine access to affordable medicines not just in India but across the developing world," said Vikas Ahuja of the Delhi Network of Positive People (DNP+).

Members of the Forum Against FTAs met with officials from the Ministry of Commerce and Industry which is negotiating the FTA and submitted a memorandum, copies of which have also been sent to the Prime Minister’s Office. The Memo demands that the UPA release all information, studies and negotiations on the EU-India FTA and all other FTAs being negotiated. A further demand for a white paper on the UPAs FTA strategy has been made.

To: Shri. Anand Sharma
Minister for Commerce and industry
Government of India
Udyog Bhavan
New Delhi

Dear Sir

We are writing to you to express our serious concerns over the EU India Free Trade Agreement (FTA), as this FTA with the 27-European country bloc will impact critical aspects of the Indian economy and people’s lives. We note with grave concern that the GOI’s numerous FTAs under consideration cover areas that fall within the state and concurrent list, but the GOI has ignored and sidelined the parliament, state governments, citizens of India including farmers, workers, womens’, dalit and adivasi groups who have not been consulted in the process of FTA negotiations. No consultations, public discussion of the pros and cons, release of government studies, government positions and submissions have taken place with these constituencies. This makes a mockery out of the federal polity and the democratic ethos of India.

Repeated requests for consultations access to information and genuine discussion in the parliament and the states on the FTA have gone unheard. Both the GOI and the European Commission have consistently refused to share information with civil society groups and the general public— undermining the basic tenets of democratic process, policy making and law.

The EU-India FTA raises several key concerns with regard to peoples’ livelihoods and an just economic development strategy for the country that is now considered "emerging":

1. Impact on livelihoods: The EU-India FTA will ensure a reduction of 90% of Indian import duties to zero on day one of implementation, while leaving the heavy subsidies on European agricultural goods unaffected. This will hit the Indian agricultural sector hard impacting lives and livelihoods dependent on it. In addition the services and investment chapter of the FTA will make the entry of European agro-processing and retail firms easy thereby impacting how food is produced and sold in our country. Small and marginal farmers, processors, distributors and retailers in India will be pitched against the power of multinational retail firms.
2. Financial Liberalization will make us vulnerable to Financial Crisis: FTA demands in finance would make it difficult to control the rapid influx and exit of risky investors, a major reason for financial crises in Asia and around the world. In the wake of the global financial crisis, a serious rethinking on opening financial services must take place. The crisis has delegitimized the "best practices" of European banks and calls for expansion of domestic regulatory space which FTAs restrict.
3. Access to minerals opened for EU: India is the third largest producer of "metallic minerals" including "chromite" and other "rare earth" minerals and currently restricts exports of iron ore and non iron metal scraps. The EU-India FTA will be one of the key avenues for obtaining access to these natural resources both through targeting our export restrictions and through the investment provisions in the FTA, exacerbating land struggles in the country.
4. Revenue losses: Our import duties are higher in comparison to the EU. India’s average import duties are 32% for agriculture and 10% for industrial and fisheries imports. Import duties are also the easiest way of collecting taxes for the government since goods cannot enter without the necessary duty. However, the EU India FTA along with the others that the government is negotiating will create a major loss of import duty income for the government and affect our national budget. This in turn is likely to have serious impacts on Government spending in social sectors like education and health and the proposed National Food Security Bill.
5. TRIPS-plus intellectual property protection: The EU’s demands for TRIPS-plus intellectual property (IP) rights would lead to legislative and policy changes in India with regard to the scope of IP protection and enforcement. India’s Protection of Plant Varieties and Farmers’ Rights Act 2001 is therefore under threat. TRIPS plus provisions intensify monopolies over seed, pesticides, fertilisers and animal vaccines and encourages proprietary agriculture technologies – such as GM crops and fish. India’s access to affordable medicines, the Government’s ability to issue compulsory licenses on medicines will be severely affected.
6. Liberalising Government Procurement: The EU is also insisting that government procurement, which accounts for nearly 13% of India’s GDP, be opened up to EU companies. Government procurement has the potential to revive under-developed economic regions, boosts domestic production and help fight against economic recession. Government contracts can also help support Small and Medium Enterprises, marginalized constituencies and poorer states by channeling money through local firms for goods and services.
7. Giving Up Our Policy Space for No Clear Gains: The EU is negotiating 108 FTAs or Economic Partnership Agreements. It has numerous "non trade barriers" in both goods and services. Giving "substantial" concessions in the FTA when any preferential treatment from the FTA will be quickly eroded makes no sense. We are not likely to bring down EU’s non-trade barriers. The costs significantly outweigh the benefits.

It is of grave concern that the EU-India FTA negotiations till date have been marked by a gross absence of transparency and public debate. There is an urgent need for an informed public debate on the feasibility and development outcomes of the GOI’s FTA strategy as a whole.

We request you to immediately:

1. Stop all FTA negotiations until there is public consultation.
2. Release all information, studies and negotiations on the EU-India FTA and all other FTAs being negotiated or in consideration.
3. Issue a white paper on the GOI’s FTA strategy in parliament on the cumulative socio-economic and ecological impact, especially addressing social inequality and discrimination. A separate white paper on the EU-India FTA and other North-South FTAs is also requested.
4. Complete a federal process of consultation with the state governments, including the sharing of draft texts, and reach a consensus with the states.
5. Set up a process for Parliamentary and State Legislatures’ approval before FTAs are signed.

Yours Sincerely

Forum Against FTAs

Copy to:
1) Shri. Manmohan Singh, Honurable Prime Minister of India
2) Shri. Pranab Mukherjie, Honurable Minister for Finance

EU-INDIA FREE TRADE AGREEMENT: LAST CHANCE TO REMOVE PROVISIONS THAT BLOCK ACCESS TO MEDICINES

As the European Commission (EC) and India meet for closed-door negotiations on a Free Trade Agreement (FTA) this week, international medical humanitarian organisation Médecins Sans Frontières (MSF) warns this is the last chance to remove provisions that will block access to life-saving medicines for people living in the developing world.

"Neither Indian Trade Minister nor the EU Trade Commissioner have given a public commitment that the provisions that affect generic competition and access to medicines are off the table," said Michelle Childs, Director of Policy & Advocacy at MSF’s Campaign for Access to Essential Medicines. "We will continue to fight until they are officially and unequivocally out of the agreement."

India is the source of 80% of the AIDS medicines used in MSF projects. Without quality affordable medicines from Indian sources, it would have been impossible to scale up treatment to the levels seen today, and millions of lives would not have been saved.

Through their governments’ contributions to the Global Fund and other international health agencies, European taxpayers pay for programmes that can treat far more people thanks to affordable medicines from India. But MSF and other groups are concerned that the EC is now trading this away. The draft agreement contains several alarming provisions on intellectual property and enforcement, much stricter than anything required under the international trade rules, that threaten the supply of essential medicines from India.

"The right to life and health of people in developing countries is being sacrificed in this deal," said Loon Gangte, president of the Delhi Network of Positive People (DNP+). "Do not put profits before patients. This trade agreement must not undermine India’s ability to provide people living with HIV/AIDS here and outside India with life-saving medicines in the name of open markets."

One of the harmful provisions in the FTA is `data exclusivity’. If India introduces data exclusivity, generic companies wishing to register a medicine will be obliged to repeat clinical studies. This not only creates huge financial barriers that act as a disincentive to generic companies, but it is also in violation of medical ethics, as people are subjected to the risks of clinical studies for something that is already known. Data exclusivity therefore creates a new patent-like barrier to access to medicines and vaccines, even when these products are not protected by a patent.

"The impact of this proposed agreement is truly global, as treatment will become considerably more expensive, and countries and funders may have to ration the numbers of people they can put on treatment", said Ariane Bauernfeind, HIV/AIDS programme manager for MSF projects in South Africa, Malawi, Lesotho and Zimbabwe. "We are already concerned that newer medicines have been patented in India. The FTA threatens to make an already bad situation worse."

Also in the draft FTA is a provision that extends the duration of a patent term beyond 20 years. In addition, after multiple incidents of Indian generic medicines being detained while in transit to other developing countries in Latin America, Asia and Africa, the EU is now seeking to legitimise such measures by forcing India to adopt them.

Formal talks between European and Indian negotiators are opening in Brussels this week. The EU has indicated that it wants to conclude the FTA negotiations ahead of the EU-India summit in October.