Unequal partners

Print edition : March 24, 2006

President Bush helps a worker plough a field with a hand tool during his visit to the Acharya N.G. Ranga Agriculture University in Hyderabad. Andhra Pradesh Chief Minister Y.S. Rajasekhara Reddy looks on. - JASON REED/REUTERS

Many elements in the initiatives in the areas of agriculture and economic cooperation can be harmful to the national interest.

A SUCCESSFUL Indo-United States agreement on civil nuclear cooperation was undoubtedly the centrepiece of the visit of President George W. Bush. But several other important bilateral agreements and initiatives were also concluded. All these, including the nuclear agreement, essentially flowed from the Joint Statement of July 18, 2005, by President Bush and Prime Minister Manmohan Singh during the latter's visit to the U.S.

While there is reason to be more than satisfied with the outcome of the negotiations on the nuclear front, many elements in the initiatives in the areas of agriculture and economic cooperation, in particular the Indo-U.S. Knowledge Initiative in Agriculture (KIA), could be inimical to the national interest.

The KIA was formalised through a joint declaration in November 2005, which stated that its objective was to promote teaching, research, service and commercial linkages to address contemporary challenges. This, it envisioned, would be carried out through "public-private partnerships" that will "facilitate technology transfer, bolster agricultural research, education and extension and strengthen trade and regulatory capacity building."

A Board constituted in December 2005, with representatives from both countries, adopted this February a three-year work plan to achieve what it has termed an "Evergreen Revolution" based on "environmentally sustainable, market-oriented agriculture".

Significantly, for this "market-oriented" agricultural research and education, the U.S. representation on the Board includes American multinationals Monsanto and Wal-Mart.

The work plan, interestingly, includes only the following: education, curriculum development and training; food processing and marketing; biotechnology; and water management. With Wal-Mart's interests in retailing agricultural products and Monsanto's focus on the development of genetically modified (GM) crops or transgenics, it is clear that the agenda of collaborative farm research with Indian agricultural institutions is being set by the multinationals and this is cause for serious concern. More pertinently, while India will contribute about Rs.350 crores over three years, the U.S. has pledged only $24 million over the same period.

The July 18 statement had called for a Science & Technology Framework Agreement that would build on the initiatives under the Indo-U.S. High Technology Cooperation Group (HTCG) set up in November 2001. The objective of the framework agreement was to formalise protocols on Intellectual Property Right (IPR) issues arising from collaborative work under the various ongoing bilateral S&T cooperation initiatives, in particular the Indo-U.S. S&T Forum established in 2000. IPR issues with the U.S. under bilateral agreements have always been contentious and the bid to forge an S&T agreement in 1993 failed because of differences over IPR issues. This time too, the two sides could not resolve the differences at the time of the Manmohan Singh-Bush meeting. So the agreement had to wait until October 17, 2005, when U.S. Secretary of State Condoleezza Rice and India's S&T Minister Kapil Sibal signed it in Washington after the IPR issues were sorted out to mutual satisfaction.

Specifically, the agreement allows joint ownership of IPR (and other associated commercial benefits) arising out of collaborative research in conformity with the laws of the respective lands. Specifically, in cases where one party provides IPR protection and the other does not - as in patenting of genes or life forms - the former can commercially exploit the rights worldwide while the latter would be free to exploit the development on its soil only. Rights in a third country will be determined on a case by case basis by mutual agreement based on the respective share of contribution to the development.

This inter-governmental agreement will be in force for a period of 10 years unless either side withdraws from it after giving six months' notice. For the implementation of programmes under the agreement, an umbrella body called `Bi-national S&T Commission' has been set up. An agreement on this was signed during Bush's visit. The Commission will supervise the implementation of programmes under all Indo-U.S. collaborations in S&T - such as the Indo-U.S. S&T Forum and the HTCG - and other inter-institutional arrangements.

To fund the various collaborative S&T projects that the Commission would oversee, an S&T Endowment Fund has been created to which both countries would contribute equally. This became necessary as the interest from the Rs.30 crores made available from the $110-million U.S.-held Rupee Fund (created in 1987), together with the matching amount put in by the government, was too meagre for the activities under the Indo-U.S. S&T Forum. An additional Rs.65 crores from this Rupee Fund that had remained unspent in Indo-U.S. collaborative activities in the areas of education and culture will now go into the Endowment Fund.

Inside a Wal-Mart store in Grove City, Ohio. There are U.S. representatives of the multinationals Monsanto and Wal-Mart on an Indo-U.S. board set up in December 2005 to achieve an "Evergreen Revolution".-JAY LAPRETE/BLOOMBERG NEWS

In effect, this inter-governmental S&T cooperation is being launched without any foreign exchange input by the U.S. This may be contrasted with the first-ever Indo-Australian initiative in S&T, following Australian Prime Minister John Howard's recent visit, where $25 million has been made available in hard cash.

A proposal for a new initiative for cooperation in industrial research and development (R&D), modelled on the Bilateral Industrial R&D (BIRD) initiative between the U.S. and Israel, which is co-funded by the two countries, had been proposed earlier. But this did find favour with the U.S. Industrial research has been now subsumed under the Bi-national Commission with no separate funding.

The July 18 statement had also urged further discussions under the HTCG and the Next Steps in Strategic Partnership (NSSP), a January 2004 initiative of Bush, to enable India to access U.S. dual-use goods. The fourth round of HTCG negotiations took place on November 30, 2005. According to the U.S. Department of Commerce, only 1 per cent of the exports to India required U.S. export licence and in the fiscal year 2004-05, over 90 per cent of licence applications for goods controlled by the U.S. Export Administration Regulations (EAR) - dual-use goods - were approved.

Two important changes were made to the export controls since July 18. One, as was agreed then, was to remove some of the Indian Satellite Research Organisation (ISRO) units on the Entity List, which imposed severe restrictions on import of dual-use goods in the wake of the 1998 Pokhran nuclear tests. This perhaps is the only tangible outcome of the negotiations under the NSSP. In fact, the July 18 statement had declared the end of the NSSP with the removal of these organisations from the Entity List.

Two, export of certain nuclear-related dual-use items that are unilaterally controlled by the U.S. (12 in all) was decontrolled. The impact of these changes would be evident in the licence applications data for Fiscal 2006. The Manmohan Singh-Bush Joint Statement of March 2 further stated that the U.S. now proposed to remove licence requirement for the export of dual-use goods requiring a licence to end-users in India solely engaged in civilian activities. If such a licence exception is extended to all categories of licensed goods, its impact is likely to be significant, as over 70 per cent of licensed exports to India in recent times have been to the civilian sector.

Cooperation in space technology and commerce has been under discussion right from the beginning of the Indo-U.S. dialogue in high-tech; first under HTCG, then under NSSP and now under the Joint Working Group on Civil Space Cooperation set up following the July 18 agreement. Space cooperation is what is likely to yield tangible and commercially exploitable benefits for ISRO and, compared to the nuclear field, this agreement should be simpler to conclude in principle.

In the nuclear field, there are the issues of the safeguards regime of the International Atomic Energy Agency (IAEA), adjustments in the restrictive U.S. non-proliferation laws flowing from the Nuclear Non-Proliferation Treaty (NPT), and the overarching guidelines of the NSG. In the case of space, besides changes in the licensing policies of the U.S. Department of State that govern the export of satellites and subsystems, there are no such overarching global controls to contend with. And yet, the Indo-U.S. space cooperation is yet to make tangible progress even though the process of negotiations began much earlier.

As part of the NSSP, an ISRO-Boeing joint satellite fabrication initiative was launched. However, this failed to fructify because of the complex licensing procedures of the U.S. Department of State, which regulates the export of satellites and related systems and components.

Early last year, Boeing decided to drop the idea chiefly because of the cumbersome licensing and approval process involved. The complicated regulatory procedures could have been simplified as part of the NSSP, if the U.S. sincerely desired. Unfortunately this did not happen.

Launching of U.S.-made satellites or satellites with U.S. components on ISRO's launch vehicles requires licensing by the U.S. State Department. A Technology Safeguards Agreement (TSA) and a Launch Services Agreement (LSA) have to be concluded with the State Department. The LSA will permit exchange only of payload interface data and nothing more. These are under negotiations with the U.S. as part of the bilateral talks.

According to ISRO sources, the U.S. insisted on a full-fledged TSA, which included restrictive movement of the payload, constant overseeing presence of U.S. escorts, and impermeable firewalls between civil and military (akin to nuclear safeguards) payloads. This, however, has not been accepted by ISRO.

Clearly, this other hyped aspect of the Indo-U.S. space talks will take time to fructify. This is evident from the original draft, which was changed. The draft statement had said: "[The U. S. and India] agreed on a common vision for space cooperation that includes agreement for the launch of U.S. satellites and satellites containing U.S. components by Indian space launch vehicles."

It now reads: "The U.S. and India are committed to move forward with agreements that will permit the launch of U.S. satellites and satellites containing U. S. components by Indian space launch vehicles... "

In the meanwhile, the two sides have agreed on the modality for carrying the National Aeronautic and Space Administration (NASA) payload - basically two instruments weighing a few kilograms - on the Indian lunar mission. Even here there were initial problems as regards the TSA. However, a mutually acceptable solution has been arrived at for Chandrayaan and the agreement for this was formalised during Bush's visit.

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