Wednesday, November 22, 2006

Subsidies and cotton

FE reports:
Strongly defending farm practices in the US, Johanns (the secretary in the US department of agriculture) said that in the US about 60% of farmers did not depend on any subsidy. There was no subsidy for beef, poultry, pork, fruits and vegetables, he said, adding that only 40% of farmers get the benefit of the subsidy regime.

In the US, it was the soybean and cotton growers who take the chunk of 93% of the subsidy, he said

When pointed out that Indian farmers would be adversely affected by opening up of markets to the cheap subsidised goods, Johanns said: “Indian textile industry imports cheap subsidised cotton from the US and make huge profits.”

Subsequently, when he was told that it was the industry that had prospered on account of cheap imports while the Indian cotton growers were in distress, Johanns did not have any satisfactory answer.
I am not sure if the distress of cotton growers is because of cheap imports. Anyway, those who have been complaining that US has been throwing billions of dollars to protect 0.7% of labour force, can now take some consollation that it's actually 40% of that 0.7%

No comments: