Taking the issue Due North

The US government has just givenThe Canadians a well-deserved kickon their pants. It has forced Canada notjust to cut subsidies to its domestic lumber industry but also accept effectivequotas on lumber shipments to the US.The US argued that the Canadian lumberindustry is unfairly subsidised, whichhas resulted in a steady increase ofCanadian lumber in the Americandomestic market - from a 27 per centshare in 1991 to a record 36 per cent in1995. As a result, US lumber mills havecut thousands of jobs, and lumberprices have dropped by more than one-third since early 1994.

The Canadian colonisers, whofound-vast tracts of forests, have beenmerrily plundering and pillaging theirnatural heritage. Different Canadianstates have set their own tree-cuttingfees and tend to give away their forestsat well below market prices - something that we did too with our forests, tofeed our paper industry. Now theCanadian provinces have been forced toagree to not just increase tree-cuttingfees, but if these still do not sufficientlyshrink their lumber exports, they willtake back-up measures like export taxesand quotas.

The news gave me a perverse pleasure because it was precisely the sameCanadians who had ruined India's massive experiment with farm forests in themid-'80s. Indian foresters and papermanufacturers had somehow convincedthe then Prime Minister, Rajiv Gandhi,that if he permitted reduced customsduties on foreign pulp imports, it wouldsave India's forests. These great visionary entrepreneurs, who are today cryingfor wood, had then found it cheaper,and hence more expedient, to importpulp from Canada rather than buywood from Indian farmers and pulp itdomestically.

Seeing their market crash - noIndian farmer will grow wood unless itfetches a price equivalent to, or betterthan, the competing crop - the farmersplucked out millions of plants fromtheir farms. The Canadians had, thus,cook destroyed what was slowlybecoming a strategy for internal mobilisation of wood resources and improvedenvironmental regeneration in India.

Undoubtedly, there are problemswith India's farm forestry. It was mainlyreaching out to big farmers, who wereusing quality agricultural lands forplanting trees like eucalyptus. The idealsolution would have been to developpolicies so that poorer farmers, whoowned poor-quality lands, could havegrown multi-purpose tree species. It wasa lesson that India would have slowlylearnt, and had, indeed, started learning. In the lateritic tracts of WestBengal, many patta-holders (land deedholders) could not grow anything ontheir state-gifted lands, which were sopoor that the owners largely remainedmigrant labourers. They suddenlyfound that they could now growtrees and earn a good price too. Farmforestry was a source for income theyhad never seen before. But this couldnot continue unless the wood marketexisted.

Canadians do not have problems ofcompeting crops, nor of competing usesfor their lumber. As long as they can cutthe trees cheaply enough, they can holdthe market to, ransom. Canadian NGOshave often disparagingly called theircountry the 'Brazil of the North', which,I personally think, is most unfortunate.Brazil at least has problems of povertyand development associated with itsAmazonian crisis, whereas theCanadian forestry pillage is nothingmore than just that, and exclusively forcheap wealth.

And strangely, something I havenever really understood, it was Canadathat fought for a forest convention atthe Rio Earth Summit in 1992. Till theend of the conference, everyone wasguessing what this convention was allabout. Just what is it that the Canadiangovernment then wanted, and stillwants, in the UN from, a forestconvention remains a mystery - orshould I say, conspiracy? Is it trying topush a convention that will protectforests, or its own economic interest inforestry?

But the US-Canada tussle does showhow, in a globalised economy, if onecountry undervalues its environment, itcan send massive economic reverberations across the globe. The need forbuilding in ecological costs into internationally traded commodities remainsimperative. However, the US government itself is not trying to make anyserious point about trade and environment issues in this tussle.. This is election year, and the Clinton administration - despite all its past rhetoric onfree trade - is desperately trying toassure its own workers and industry thatit cares for them.

The Wall Street Journal recentlyreported how the American government is trying to subvert Mexicanexports by denying Mexican trucksaccess to US roads. The point beingmade is that Mexican trucks are unsafefor US roads. The Washington Postrecently even carried an advertisementprotesting a bill in the Congress whichprotects Florida tomato growers, whogas the tomatoes to ripen them, fromvine-ripened Mexican tomatoes that areimported. This the bill would do bychanging the standards in the US law.The Republican-dominated Congressdoes not care a bit about what this willdo to US commitments in NAFTA or WTO.

I guess all this simply teaches us thattrade is still an issue that has more to dowith politics than rationality. After all,that is exactly what the East IndiaCompany had taught US.