SPEECHES AND REMARKS 2006

U.S. Chargé d'affaires Highlights Importance of Technology and Knowledge for Agriculture

October 19, 2006

New Delhi - U.S. Embassy Chargé d'Affaires Geoffrey Pyatt highlighted the importance of technology and knowledge to improving productivity and accelerating agriculture sector reforms in a speech at the Agriculture Summit 2006 sponsored by the Ministry of Agriculture and the Federation of Indian Chambers of Commerce and Industry at Vigyan Bhavan today.

Emphasizing the importance of U.S.-India cooperation in technology as a source for growth in the agriculture sector, Mr. Pyatt said, "The United States and India can use knowledge-based research and new technologies to bring practical solutions to help Indian farmers.  But other benefits will come from increasing collaboration in agriculture, especially by drawing in greater private investment."

Mr. Pyatt noted that President Bush and Prime Minister Singh had singled out agriculture as an area of overarching importance for bilateral cooperation where U.S. and Indian interests converge during their July 2005 and March 2006 meetings.  The leaders conceived of the Agricultural Knowledge Initiative specifically to harness the benefits of fresh ideas, cutting-edge research and new technologies to increase productivity and growth in India's agriculture sector.
 
This new initiative is a work in progress that has great potential but will require considerable joint effort and vision to make a true success.  With the support of our leaders and the commitment of our two governments, he expressed confidence that our two countries can make it happen.

Concluding, Chargé Pyatt highlighted the value of growing U.S.-India collaboration:  "Strengthening our partnership will serve the economic, strategic and agricultural interests of both our countries for many years to come as India assumes an increasingly important leadership role across Asia.  In agriculture, as in so many other areas, America will be your partner - and that's good news for both of us."

Following is the transcript of the Chargé's address:

October 19, 2006

As prepared for delivery

Remarks by
Geoffrey R. Pyatt
Chargé d'Affaires
Embassy of the United States of America
Vigyan Bhavan, New Delhi
October 19, 2006

Good morning.  I would like to thank the Ministry of Agriculture and FICCI for the opportunity to address this gathering on the future of U.S.-India relations and our cooperation in agriculture in particular.

The United States and India are building an historic partnership premised on the belief that no other relationship will be more important in shaping the world of the 21st Century.  It is a relationship based on shared interests and shared values and touches a wide variety of areas.

The fundamentals of this partnership are based on people-to-people, scholar-to-scholar, and company-to-company links.  An indication of the strength of our ties is the fact that more than 80,000 Indian students have chosen to study in the United States this year.  A growing number of American scientists, academics and students are also choosing to focus their research and studies in India.

Another strong indicator of the health of our partnership is the long-term business and research alliances being formed between Indian and American companies, scientists, customers and clients every day.  Examples of such collaboration extend throughout India and across most sectors of the economy.  U.S. businesses long active in India's services, information technology, agricultural and manufacturing sectors such as Boeing, GE, Pepsico, IBM, and Ford are making significant new investments.  Small and medium size U.S. companies are increasingly engaged in the Indian market, and the momentum is only increasing.

Investments by Indian businesses in the United States have also been growing with companies such as Tata, Infosys, Bharat Forge, Genpact, Dr. Reddy's, and Ranbaxy expanding their presence in the U.S. market through acquisitions and direct investments. 
These partnerships will provide an important source of stability in the U.S.-India relationship, ensuring that the estrangement and antagonism of past decades remains buried in the past.

The Agricultural Knowledge Initiative

Today, I would like to focus on the importance of U.S.-India cooperation in the agriculture sector.  President Bush and Prime Minister Singh have singled out agriculture as an area of overarching importance for bilateral cooperation where U.S. and Indian interests converge.  Recognizing this, in July 2005 the President and Prime Minister announced the Agricultural Knowledge Initiative, and in March 2006 they reaffirmed their commitment to strengthening our cooperation in this area.

This new initiative is a work in progress that has great potential but will require considerable joint effort and vision to make a true success.  With the support of our leaders and the commitment of our two governments, I am confident we can make this happen.

The United States and India have already established a formidable partnership in important high technology and knowledge areas, sectors that are vital for economic growth for both our nations in the 21^st century.  Our companies are working together to develop advanced software and telecommunications equipment.  We are exploring space together.  We are developing new medicines together.  And we are nearing completion of a landmark agreement on peaceful cooperation in civil nuclear energy that will open new horizons for joint research and investment in that area.

The vision the President and the Prime Minister have outlined in their Agricultural Knowledge Initiative is intended to deliver the benefits of similar cooperation to the hundreds of millions of Indians who work the land. 

The United States and India have a proud history of cooperation in agriculture.  Our collaboration today recalls our success in using joint research to fuel India's Green Revolution 40 years ago.  But while the Green Revolution was successful in helping India achieve food self-sufficiency, India's agriculture sector faces different challenges if it is to reach necessary levels of productivity.

The bottlenecks to growth are well known.  They include excessive water use; over-use of fertilizers that damage soil and water; structural inefficiencies in distribution systems, with crops left uncollected in the fields or rotting in poor storage facilities; and fear of policy changes that would benefit farmers and consumers alike.

Addressing these issues requires research and technology that can be of use to farmers, and reforms of policies that discourage the private investment that is vital for modernization of the agricultural sector.

Indian agriculture is poised for a second revolution to move from supply-driven to market-driven production and to significantly increase farmers' productivity, but that will not happen without attacking the key bottlenecks.

The Agricultural Knowledge Initiative is intended to help India achieve efficient market linkages, to facilitate technology transfer for higher value added products, to bolster agricultural research and education, and to strengthen trade and regulatory capacity in the agriculture sector.  These, in turn, will contribute to increased prosperity for farmers and agricultural progress and will accelerate India's overall economic growth and trade. 

Applying Practical Knowledge Increases Growth

Thanks in large part to economic reforms introduced by successive governments, India has entered a period of sustained economic growth that should raise the standard of living for all its citizens.  While most of India's economic growth has come from its service and manufacturing sectors, the agriculture sector, which represents almost 2/3 of the Indian work force, continues to grow at a relatively slow rate of between 2 and 3 percent, and farmer incomes, I am told, remain stagnant.

In his Independence Day speech from the Red Fort, and yesterday at this summit, Prime Minister Singh highlighted the government's commitment to increase growth and productivity in agriculture to raise the standard of living for all India's citizens.

Prime Minister Singh and President Bush conceived of the Agricultural Knowledge Initiative specifically to help address this crucial issue - how to harness the benefits of fresh ideas, cutting-edge research and new technologies to increase productivity and growth in India's agriculture sector.

The Agricultural Knowledge Initiative is intended to support the Government of India's effort to build a market based environment that is conducive to research, technology transfer, trade, and investment.

In my own State of California, and across the Country, one of the great successes the United States has enjoyed over the past sixty years has been collaboration between our farmers, universities, government agencies, and private companies to apply the benefits of agricultural research to the practical challenges that our farmers confront.  This multifaceted cooperation has produced discoveries and technologies that have brought tremendous productivity growth, lifting the standard of living and rate of economic growth for all Americans and lowering the cost of the food on our tables. 

I am confident that the proud and hard-working Indian farmer, given the tools, technology, and information now available, could significantly increase productivity and share the benefits of that growth with India.  However, to realize these benefits, policies and practices need to be in accordance with India's opportunities, and that is where the Agricultural Knowledge Initiative comes in.

Applying Knowledge in Agriculture

Whether it is designing systems for cold storage chains, developing new higher yield seeds, creating commodity price information and risk-mitigating mechanisms, or building systems to use water more efficiently, the combined efforts of farmers, universities and corporations have yielded practical solutions that have benefited all Americans.

The Agricultural Knowledge Initiative seeks to bring the benefits of these practical approaches to help India's farmers.  To lead this initiative, our countries created a board that represents all the players needed to create true cooperation in this area.  These include representatives from academia, government, and the private sector.  This participation from a broad cross section of our respective agricultural establishments helps ensure transparency and responsiveness.  We appreciate the time and expertise that each has provided to support this effort. 

I especially want to thank Dr. Mangala Rai, Secretary of India's Department of Agricultural Research and Education and Director General of the Indian Council for Agricultural Research who chairs the Agricultural Knowledge Initiative on behalf of the Government of India. 

The Agricultural Knowledge Initiative's work plan focuses on food processing and marketing, biotechnology, water management, and university capacity building, reflecting the areas of most likely growth.  Within these four areas there are many opportunities for collaboration, some of which are already underway.

Last week, for example, the United States Agency for International Development (USAID) launched a program with India's Forward Markets Commission that will improve price and market information tools for India's farmers.  The program uses experience with good regulatory practices and market knowledge to promote reliable commodity futures markets in India and to help make India's commodity markets safer and more transparent for farmers and traders.

In food processing and marketing, we want to target training, capacity building and joint research to improve quality assurance, food safety, reduction of post-harvest losses, and market information systems, among other areas.  One only has to visit the Himachal-Haryana border this time of year with the cows growing fat on piles of spoiled apples to appreciate the losses that Indian farmers endure because of poor distribution and storage systems.  There is no reason why India should lose up to 1/3 of its food products due to lack of an effective supply chain.

In fact, the United States and India are already working together to find better solutions to bring products from the field to the market.  The United States Trade and Development Agency is providing about 2.3 crores rupees ($500,000) to engage Indian importers, farmers, distributors and retailers in developing solutions for building India's cold chain infrastructure, and that is just a first step forward.

In biotechnology, there are several exciting collaborations designed to improve agricultural productivity.  This August and September, Indian scientists attended a biotechnology symposium at the University of California, Davis.  In the coming year, Indian Borlaug fellows will work with mentors at U.S. universities on biotechnology topics.  And in late 2007, we plan a workshop on "Harnessing the Benefits of Biotechnology".

Research on the development of "Golden Rice" is another area of collaboration that could have dramatic benefits for agriculture.  Working with the Indian Council for Agricultural Research, USAID is supporting India's involvement in an international effort to develop rice varieties containing levels of pro-Vitamin A that could greatly reduce Vitamin A deficiency.  This technology has the potential to reach remote rural areas where medical care and dietary diversity have failed to adequately address problems of blindness and child mortality. 

Private Investment Helps Support Agricultural Innovation

These examples demonstrate how the United States and India can use knowledge-based research and new technologies to bring practical solutions to help Indian farmers. 
But other benefits will come from increasing collaboration in agriculture, especially by drawing in greater private investment.  Private investment in the agri-foods sector will be key to increased agricultural productivity that pushes India's already impressive growth rates into double-digit territory. 

One excellent example involves an American company in West Bengal.  PepsiCo's Frito-Lay division launched a highly successful food processing plant in 2004.  When it began its initiative to cultivate potatoes in West Bengal, Frito-Lay confronted a challenging situation of small-scale, low-tech farming, with individual farmers cultivating on average no more than an acre and a half of land.  To achieve economies of scale, Frito-Lay worked closely with local authorities to develop West Bengal-specific agronomic practices.  In addition, the company conducted a comprehensive program of village training to educate the farmers on its plans for potato cultivation.

The parties introduced a partnership-farming concept, with contracts spelling out the technology, seeds, fertilizer and inputs to be provided by Frito-Lay and the output specifications and price at which the produce was to be purchased back from the farmers.

Frito-Lay joined village governing bodies to encourage the poor, marginal farmers to form cooperatives.  Starting with 140 farmers and 700 acres in 2003, this year, Frito-Lay is now working with 4000 farmers including 1700 under 10 cooperatives and 13,000 plots totaling 2100 acres.

The results are impressive.  Farm practices have improved dramatically and farmers say they are seeing a difference in plant vigor and growth compared to traditional methods of cultivation. Variety trials continue for more improvement and self-sufficiency.  West Bengal recorded the highest yields in India of 23 tons per hectare among Frito-Lay-assisted potato cultivation projects and produced 19,500 tons in 2005-06.  The West Bengal plant has a capacity to handle 30,000 tons of potatoes, and based on its recent successes, Frito-Lay has already announced expansion plans.  

Conclusion

I think you can see from these highlights why greater cooperation between us in agriculture is so valuable.  India and the U.S. have come a long way together in the past few years and there is much more to come.  This progress is due to the vision of our two leaders, but also to the vision and energy of people like you. 

Strengthening our partnership will serve the economic, strategic and agricultural interests of both our countries for many years to come as India assumes an increasingly important leadership role across Asia.  In agriculture, as in so many other areas, America will be your partner - and that's good news for both of us.