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Biotechnology Regulatory Policy
Wheat Market Efficiency in India
Economics of Cotton Quality in India
Economics of Sanitary and Phytosanitary Barriers
Developing Country Chain Retail Study
Biotechnology Regulatory Policy
In the United States and some other parts of the world, agricultural
biotechnology has allowed the development of innovative plant
technologies that have reduced production costs and improved
farmer incomes, enhanced quality attributes desired by end-users,
and provided environmental benefits in the form of reduced pesticide
use. In India, however, only one of the many available genetically
modified (GM) genes—the Bt gene used in cotton—has
been approved for cultivation by the Government of India. The
adoption of hybrid Bt cotton has contributed to the rapid growth
in Indian cotton yields and output since the early 2000s. So
far, however, the Government has struggled to build consensus
for a more transparent, science-based regulatory framework to
govern agricultural biotechnology, thus slowing the development
and spread of new GM varieties, compared with efforts of some
other countries.
Using funds from USDA's Emerging Markets Program, ERS
has contributed to research on various aspects of biotechnology
regulation in India, including India's regulatory system
for GM crops, the costs of GM crop regulation compared with those
of other countries, and the impacts of Bt cotton adoption on
seed markets and the use of pesticides in India. Published
research from this project includes:
- The
Limits of Intellectual Property Rights: Lessons from the
Spread of Illegal Transgenic Seeds in India,
N. Lalitha, C. Pray, and B. Ramaswami, Discussion Paper 08-06,
Indian Statistical Institute, Planning Unit, Delhi, March
2008.
- "Pesticide Use Pattern among Cotton Cultivators in
Gujarat," N. Lalitha and B. Ramaswami, in Frontiers
of Agricultural Development in Gujarat, R.H. Dholakia,
editor, Centre for Management in Agriculture, Indian Institute
of Management, Ahmedabad, 2007, pp 77-98.
- "India: Confronting the Challenge—The
Potential of Genetically Modified Crops for the Poor," B.
Ramaswami and C. Pray, in The Gene Revolution:
GM Crops and Unequal Development, S. Fukuda-Parr, editor, Earthscan, London,
2007, pp 156-174.
- "Benefits and Costs of Biosafety Regulation
in India and China," C. Pray, J. Huang, R. Hu, Q. Wang,
B. Ramaswami, and P. Bengali, in Regulating
Agricultural Biotechnology:
Economics and Policy, R.E. Just, J.M. Alston, and D. Zilberman,
editors, Springer, New York, 2006.
- Costs
and Enforcement of Biotechnology Regulations in India and
China,
C. Pray, B. Ramaswami, J. Huang, P. Bengali, R. Hu, and H.
Zhang, International Journal of Technology
and Globalization, 2006, 2 (1/2), pp137-157.
- The
Cost of Biosafety Regulation: The Indian Experience,
with C. Pray and P. Bengali, Quarterly
Journal of Agriculture, 2005, 44 (3), pp. 267-289.
Wheat Market Efficiency in India
Wheat and rice are India's major food staples, and the
Government intervenes heavily in production and marketing to
help ensure adequate domestic supplies and stable producer and
consumer prices. Concern with inefficiency of public food
grain operations and the rising cost of the food grain subsidy,
including the cost of price support operations, subsidized distribution,
and food security stockholding, has stimulated debate on reform
of India's longstanding policy interventions in the wheat
and rice sectors. An important part of the debate centers
on increasing the role of the private sector in wheat and rice
marketing but, after decades of government intervention, there
has been little private investment in private grain marketing
and infrastructure. (For more information on India's food
grain subsidy, see the Policy chapter.)
Recent ERS research has focused on the Indian wheat economy,
examining the supply, demand, and trade implications of alternative
policy reform options. An ongoing study is examining the
private wheat marketing system in India, including estimates
of wheat marketing costs and the potential for gains in marketing
efficiency.
Reference
Indian
Wheat and Rice Sector Policies and the Implications of Reform,
ERS, Economic Research Report, May 2007.
Top of page
Economics of Cotton Quality in India
India is among the world's largest producers of cotton
and textiles, and these sectors are increasingly competitive
in global markets following the removal of international trade
restrictions that existed under the Multi-Fiber Arrangement,
recent reforms to domestic textile policies, and rapid gains
in cotton production due to adoption of hybrid Bt cotton. Although
higher cotton output has led to sharply higher exports of raw
cotton, the demand for more high quality cotton—free from
trash and contaminates—from some Indian textile and garment
manufacturers has led to more imports of quality cotton from
the United States and other suppliers. Reflecting the traditional
lack of attention to quality in India's domestic market,
the International Textile Manufacturer's Federation has
found Indian cottons to be among the most contaminated in the
world. Ongoing ERS research is examining the role
of quality characteristics in India's cotton market and
the extent to which the marketing system is adjusting to quality
needs of the increasingly export-oriented textile sector.
References
Growth
Prospects for India's Cotton and Textile Industries, ERS, Cotton
and Wool Outlook special report, June 2005.
The
Forces Shaping World Cotton Consumption After the Multifiber
Arrangement,
ERS,
Cotton and Wool Outlook special report, April 2005.
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Economics of Sanitary and Phytosanitary Barriers
Sanitary and phytosanitary barriers to trade have become an
important aspect of bilateral and multilateral trade relations
in agriculture, increasing the importance of improved information
for public and private decisionmakers on the economic implications
of these policies for producers and consumers. To
demonstrate how the economic implications of SPS policies can
be assessed, ERS is developing two comprehensive case study assessments
of the economic costs and benefits of SPS policies in U.S.-India
agricultural trade. One case study will address the Indian
SPS measures affecting imports of U.S. wheat; the other will
analyze the U.S. SPS measures governing imports of Indian mangoes.
Indian SPS measures for wheat include zero tolerance limits for
two pathogens and an insect pest and limits on weed seeds that
currently prevent U.S. wheat shipments to India. Current
U.S. concerns with Indian mangoes involve the presence of certain
insects associated with mangoes, as well as bacterial and fungal
pathogens that require Indian mangoes to undergo irradiation
prior to shipment to the United States to mitigate any potential
infestations. This research is being conducted in cooperation
with Virginia Polytechnic and State University (Virginia Tech)
and with funding support from USDA's Emerging Markets Program.
Developing Country Chain Retail Study
Responding largely to the opportunity afforded by rising incomes
and urbanization, domestic and multinational chain retailers are
expanding their share of food sales in many developing countries,
with potentially significant implications for food demand and trade. In
some cases, chain retailers introduce supply chain efficiencies that
can influence demand patterns by reducing consumer prices for some
foods. Because developing country consumers often spend relatively
large shares of income on food and are relatively responsive to price
changes, significant food cost reductions could trigger economywide
impacts on investment, output, and demand.
In other cases,
chain retailers may focus on introducing enhancements in food quality,
safety, and shopping convenience that appeal particularly to higher
income consumers. Finally, there may be direct influences on
demand for imported food, as chain retailers strive to improve the
diversity, quality, and safety of their offerings; reduce the cost
of imported foods due to greater supply chain efficiencies; and provide
a more viable platform than do traditional unorganized retailers
for promoting new products. To the extent that investment in
chain
retailing in developing countries strengthens food demand, including
demand for imported foods, these investments complement, rather
than compete with, efforts to expand U.S. exports.
Ongoing ERS research is examining the implications of modern food
retailing for food demand and trade across several developing and
transition countries, including India, Brazil, China, Indonesia,
and Russia. These countries provide a useful diversity of economic
and policy environments for study of the modern chain food retailing
phenomenon.
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