India and the US continue to share a peculiar relationship. Both of them are driven by insecurities. These insecurities are to be attributed to uncle Sam’s dogmatic belief that the developing world will toe its line, no matter what.
In fact, the fundamentals of the relationship are somewhat similar to the 1960s even today. At that time, the US had attempted “wheat diplomacy” with India through its PL-480 programme. The relationship had soured once the US tried to attach tough conditions to its wheat supplies. Six decades later, India is more than self-sufficient in wheat production. Tables have turned today. Now, the US wants India to export its wheat to other parts of the world amidst rising prices due to the Ukraine war whereas India is avoiding falling into the wheat trap all over again.
The ghosts of PL-480
The Indo-US friction over wheat dates back to the Nehruvian era. In 1954, then US President Dwight D. Eisenhower launched the Public Law 480 (PL-480) or “Food for Peace” programme. It was an initiative to offload all the excess wheat that the US had cultivated with price support. The US also started using it as a tool of diplomacy, because when another nation is dependent on you for its food, you can easily compel it into submission.
On India’s part too, PL-480 was a convenient option. The first Prime Minister of India, Jawaharlal Nehru pursued a central planning model that relied heavily on State-backed investments in heavy industries. PL-480 allowed the supply of food for maintaining political stability and channeling state resources into industrial expenditure.
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It was however realised by India in the mid-1960s that American food supplies came with strings attached and were being used as a means of diplomatic interference. At one point, the US even came close to rejecting wheat shipments to India, which threatened to push the country to the brink of famine. Ultimately, India would achieve self-sufficiency in agriculture through the green revolution and shake off dependence on American wheat.
Wheat confrontation starts again
Six decades after the PL-480 controversy broke out between the two countries, India and the US find themselves at a crossroads over the staple commodity all over again.
This time around, India imposed restrictions on its wheat exports. Wheat can be exported out of India only with the prior approval of the central government upon a request by the government of the importing country.
India has restricted exports in the background of a persistent heatwave and lack of rain compelling officials to lower wheat output estimates. Moreover, India has argued against WTO rules that prohibit a country from exporting grains procured by the state from the farmers at an artificially fixed price, that is, the Minimum Support Price (MSP) in India’s case.
In any case, New Delhi is ready to aid vulnerable and developing countries by allowing government-to-government transactions.
This is why India has also sought a waiver from the WTO to export wheat from state-owned stocks. India’s ambassador to the WTO Brajendra Navnit said, “We need to look at the existing constraints in the Agreement on Agriculture that are coming in the way of augmenting (food) supplies during this crisis. And we know that there is no other substitute than augmenting the global supply at this moment.”
If the WTO restrictions are relaxed, India will be able to export its wheat holdings and also help reduce the burden of soaring wheat prices in the world.
However, the US, Germany and other G-7 countries have been critical of India’s stance. They are arguing that the restrictions on wheat exports could worsen the current food crisis in the world.
India avoids falling into the wheat trap
Asking India to export wheat on the terms and conditions set by the Western world for its own advantage is more of a condescending attempt to tell the country that it somehow owes the sole responsibility to relax the soaring global prices. The richer nations, therefore, want India to do most of the heavy lifting.
This is in sharp contrast to Washington’s own track record. Remember, the US could have left India in a severe food crisis in the 1960s had New Delhi not managed to augment agricultural production within time. At that time, the US was motivated by its self-interest and India’s refusal to take sides between the USSR and the US. Today, India isn’t abandoning its moral responsibility, yet the US is sermonising it over wheat exports.
Meanwhile, New Delhi insists on government-to-government transactions and avoiding hoarding of food resources by the rich nations. Minister of State for External Affairs V Muraleedharan cautioned, “A number of low-income societies are today confronted with the twin challenges of rising costs and difficulty in access to food grains. Even those like India, which have adequate stocks, have seen an unjustified increase in food prices. It is clear that hoarding and speculation are at work. We cannot allow this to pass unchallenged.”
The Minister added that India will play its due role in ensuring global food security in an equitable and compassionate manner.
Drawing a parallel with the hoarding of vaccines during the Pandemic, Muraleedharan added, “We have already seen to our great cost how these principles were disregarded in the case of Covid-19 vaccines. Open markets must not become an argument to perpetuate inequity and promote discrimination.”
On its part, India is urging advanced economies to share some of the burdens in easing the pain inflicted by the ongoing food crisis. It has been estimated that the rich nations waste food worth hundreds of billions of dollars every year and if they curb their extravagance in terms of food wastage, the issue of global hunger could be effectively resolved.
India is ready to export its wheat but not in a manner that ends up putting up more food in the hands of governments that may hoard and waste such resources. This has led to another round of diplomatic friction between India and the US, and India again seems to be avoiding the wheat trap.
Akshay Narang is a columnist who writes about international affairs and developments in the defence sector. The views expressed in this article are those of the author and do not represent the stand of this publication.
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