In the past one year, the drought
in the Horn of Africa consisting of Ethiopia and Somalia has morphed into the
biggest humanitarian crisis in history. People migrating to refugee camps
perish before they could reach their destinations. While this painful process
is going on, a new wave of agriculture is taking shape in these countries.
Agricultural companies from developing countries like India and China are
making huge investments in Ethiopia and neighbouring countries. They are buying
up lakhs of hectares of arable land, sometimes after evicting the original
inhabitants.
A feature of these African
countries is that the farmers do not have any rights on their land. Government
owns majority of the farmlands in Ethiopia. The peasants use ancient techniques
of cultivation. When rains fail, their survival depends on the food aid. To breathe
life into this agriculture sector, the Ethiopian Government began wooing
foreign investors in the later part of the past decade. They were offered large
tracts of land at rock bottom prices. They were also given tax breaks and
Government built the roads and other infrastructure.
The biggest investor in Ethiopia
currently is Karuturi Global ltd., a Bangalore based neo agricultural company.
In the province of Gambella, they were given 300,000 hectares of land on a 50
year lease, at 10 dollars a hectare. They are cultivating palm, rice, sugar
etc. They had promised homes, schools and clinics to be built in the locality
but these are yet to be fulfilled. Thousands of farmers were evicted from the
land they have farmed for generations. Compensations were not given because
they do not have ownership on their land. Recently, Ethiopia slashed the size
of Karuturi Global Ltd.’s land concession that was larger than Luxembourg on
concern it was too big for a single company to manage and to enable an annual
migration of antelope.
Forests across hundreds of
hectares are being felled and burned to the dismay of locals and
environmentalists concerned about the fate of the region's rich wildlife. There
have allegedly been a number of arrests and killings of local people who oppose
the recent land investment. The deals are signed in such a way that there are
no limits to where the companies can sell their crops. So, most of these agro
products are exported. David Hillam, Deputy Director of the FAO, told a
conference in Washington DC in 2009, "Imagine empty trucks being driven
into, say Ethiopia, at the time of food shortages caused by war or drought, and
being driven out again, full of grain to feed people overseas. Can you imagine
the political consequences?" However, Karuturi's CEO, Sai Ramakrishna
Karuturi, denies such allegations when he says, "We are putting money into
Africa and making the lives of these exploited people better."
In Ethiopia, some of the land now
being used by foreign companies had formerly been used for the production of
teff, the staple diet of most Ethiopians. Now the land is being used by
companies like Karuturi to produce such crops as maize for export. It is
believed such shifts have contributed to the recent local price increase in
teff, the supply of which has decreased as demand has increased.
The Indian Government and the
Indian business associations have provided strong support for these companies’
endeavors in Africa. The stagnant food grain production and dependence on
international food imports prompted the Government to look for other avenues.
Rapid industrialisation and conversion of farmland for other uses has reduced
food grain production. Water availability, exacerbated by climate change and
increasingly erratic rainfall has also hit Indian agriculture hard. The opening
up of some agricultural items to International trade without proper
restrictions, have also impacted the domestic prices. In this scenario, the Indian Government has
supported a host of initiatives to facilitate Indian agricultural companies in
their overseas investments in Africa.
They support conventional new greenfield foreign direct investments,
merger and acquisitions, public-private partnerships and specific tariff
reductions on agricultural goods imported to India.
Another major way the Indian
government has financially facilitated the process is by giving concessional
Lines of credit to various African governments, banks, and financial
institutions through the Indian ExportImport Bank (Exim Bank). Often such lines
of credit are for the purpose of national development projects, and where these
projects involve agricultural development, Indian foreign investors stand ready
to win concessions and contracts for agricultural development in the form of
their foreign direct investment. The Indian government has also liberalised its
regulations on allowing outward foreign direct investment by Indian companies.
The Confederation of Indian Industries and the Federation of Indian Chambers of
Commerce and Industries have organised several buyer-seller meets between
African delegates and Indian businesses to facilitate agricultural investments
in these countries.
In 2009 the FAO along with the
World Bank and other organizations drafted the Responsible Agricultural
Investment (RAI) principles, a set of best practices and principles that
foreign investors ‘can’ adhere to. These set of rules were supposed to govern
the international transactions of farmland and also expected to incorporate the
rights of the local residents. However the RAI principles have been widely
criticised by activists and scholars as an insufficient response that can
actually result in legitimising a process many feel is rife with exploitation
and rights abuses. Critics say the fact that the principles are only voluntary
falls far short of actual laws and strict regulations that could be enforced.
In June this year, Obang Metho,
Executive Director of the Solidarity Movement for a New Ethiopia (SMNE), a
non-violent, grassroots social justice movement, wrote an open letter to thepeople of India. She raised some pertinent questions-“Any who resent the
colonial past of your own country, should know that it began through the
British East India Trading Company; where some of the more unscrupulous often
colluded with corrupt indigenous government officials. What would Gandhi say
today were he to know that Indians, who were only freed from the shackles of
colonialism in recent history, were now at the forefront of this
“land-grabbing” as part of the race for foreign control over African land and
resources; currently being called the Neo-Colonialism of Africa?” The Indian
media was largely silent on this issue except for an article by Jayati Ghosh in frontline two months back. The rest of the media were largely celebratory with
regard to companies like Karuturi.
So, are we trampling upon the
rights and lives of these innocent Africans in our quest to become a developed
country? Or, are processes like these inevitable in a world which is
increasingly finding it hard to feed its millions?
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