Zee Business TV: Welcome to another episode of Appointment, and what makes this appointment really special is our special guest, Mike Johanns, who is the Secretary, US Department of Agriculture. Welcome to Appointment, sir.

Secretary Johanns: Thank you very much. It’s good to be here.

Zee Business TV: During your visit to India you will meet the [inaudible] Minister. You already met the [inaudible] Minister. What are the issues of discussion during these meetings?

Secretary Johanns: Well, I’m here for a number of purposes, and I have had just excellent meetings. But the first thing we have talked about a lot, in fact probably the majority of my time, is the Knowledge Initiative that was created when the Prime Minister and our President met some months ago. Because it’s an Agricultural Knowledge Initiative that very significantly involves the United States Department of Agriculture working with various departments here in India. So we’ve been talking about that and how we can further that. We’ve had some great discussions on that.

We’ve also talked about some country to country trade issues. I’ll just give you a quick example. India would like to sell mangos to the United States, so we’ve been working through the process to accomplish that. The United States would like to sell wheat to India. India’s bought wheat this year, we have not been successful in selling any wheat. So there are some issues there that we have talked about. S o country to country trade issues, bilateral trade issues.

Then of course the third area where we’ve spent some time talking is the World Trade Organization negotiations, the Doha Round. I did not come here to negotiate. I’m not the negotiator for the US. That would be Susan Schwab, our United States Trade Representative. But I did come here to just explore, are there some things we can agree upon? Where are our areas of disagreement? What might we do to try to bring these talks back and have a successful Doha round?

Zee Business TV: Are you talking [inaudible]? You said you were discussing the Knowledge Initiative and that. There’s also some criticism of that. Have you also discussed that?

Secretary Johanns: I have heard that there is some criticism. There’s been a little bit of discussion on that . I have to say this. We have had a long working relationship in agriculture with India. Think of the Green Revolution that occurred with the good work of Dr. Borlaug and others here in India and what a tremendous difference that made. Probably saved the lives of thousands, if not millions of people not only here in India but around the globe. That’s kind of how we see this. We see this as an opportunity to work together, to collaborate, to exchange information in science, to develop systems that will benefit agriculture, benefit the economy here. So I understand there’s been some criticism, but I have to tell you, everything I see leads me to the conclusion that this is going to be a very very positive venture, that it will build a good working relationship and continue a relationship that dates back many many years between our countries.

Zee Business TV: Sir, the agriculture subsidies is a very sensitive issue here in India. Do you think the WTO Doha Round can again, be resumed?

Secretary Johanns: I hope the round can be resumed. I’m not sure that anybody knows exactly what the right combination is, but what I’ve been saying while I’ve been here and when I have visited other countries around the world, is we all need to be flexible.

Certainly subsidies are an issue, but in the agriculture negotiation there are actually three pillars that were focused on. One is the pillar of domestic support. That would be the subsidies and trade distorting subsidies. The other one is export competition. The other one is market access. All three have to be a part of the package and each area is contingent on success in the other area. They’re all inter-related. So we need to see progress and a balanced package. Each is contingent on the success of the other. So subsidies would be a part of it. But we can’t ignore the fact that literally every economic study that has analyzed this round has reached the same conclusion. The real success of the round, the opportunity to lift millions of people out of poverty, will come from market access. That’s really the key to the round.

All the other areas have to fit together, too, we understand that. But improved market access for all countries is what really will lift the world economy and lift people out of poverty.

Zee Business TV: I want to quote you. In a recent interview you have said that "India says they have to have 95 percent to 98 percent of their market base protected. We can’t agree to that, however [inaudible] around that major problem. That is not something we can bring back here and try to convince the White House or Congress to support."

What is the way forward going to be?

Secretary Johanns: Like I said, my hope is that we can all be flexible. India certainly has an interest in subsidies being reduced, trade distorting subsidies being reduced. India certainly has an interest in market access. I’ll give you an example. Again, India would love to sell mangos to the United States. To those farmers here that raise mangos, this is a big issue. This is an opportunity for them to improve their lives, to improve their own personal situation.

We certainly believe in that, but that’s exactly what market access is all about, improving the ability of farmers here to compete in an international marketplace.

The difficulty we have with the position taken by India, very respectfully I say this, they want to protect about 20 percent of their tariff lines in agriculture. The WTO analyzed that, and this is not our analysis. The WTO analyzed it and said well, that means they would be protecting about 95 to 98 percent of their market. They’re not only speaking for themselves, but they’re speaking for every developing country. Some of these countries are really, really world class competitors. Brazil is a developing country. They are a great competitor with the United States in soy beans. They raise soy beans that are very very competitive. China would be a developing country, even though we have a massive trade imbalance with China.

When you look at the whole picture here, to say that all of those countries -- China, South Korea, Brazil, India, et cetera -- could protect 95 to 98 percent of their agricultural marketplace is pretty stunning. It’s something that just basically would prevent [sic] trade only under circumstances that that country wanted to do trade. That would be impossible for me to convince Congress that that was a good result, and I think anyone would understand that taking 98 percent of the market off the table, it’s pretty hard to argue that would be a good, reasonable result.

Zee Business TV: But the developing nations somehow think that [inaudible] subsidies given the US. Is an effort [inaudible] countries like India, so how do you justify that?

Secretary Johanns: We have said, our President has said, in fact he gave a speech to the United Nations about a year ago where he said we should be working through the WTO process to literally reach a day where we eliminate trade distorting subsidies. Of course, again, that all has to fit together. It’s all contingent on the other. Market access, the trade distorting subsidies, the export competition. But that’s the goal that the President has put forward to the world, not just to our agricultural sector in the United States. But he’s saying we should be working toward a day where we can eliminate those trade distorting subsidies. But it is contingent on the other two parts of the agriculture negotiations being successful.

Zee Business TV: Do US farmers need subsidies?

Secretary Johanns: There are times where subsidies have made the difference between absolute success or failure. There is just no doubt about that. I would tell you this, I grew up on a farm. I grew up on a small dairy farm in the state of Iowa. I was Governor of the state of Nebraska which is a major agricultural state. Every farmer in America tells me that if they have a level playing field with trade, they believe they have the ability to compete on a worldwide basis. They have successfully done that.

Farmers in the United States are like farmers everywhere. They want to farm for the marketplace. They want to be able to sell their products to other parts of the world without unnecessary burdens like high tariffs or unreasonable requirements that can’t be met. That’s really what farmers in the United States are seeking. But having said that, I think that’s the goal of every farmer.

It would be probably surprising to many people that literally our Prime Minister and President have had a conversation about India selling mangos to the United States, but you know that’s happened. Why has it happened? Because that can have a very positive affect here. Again, for those farmers who raise mangoes, that’s a very big issue. The ability to sell their products in the international marketplace without unreasonable burdens, without high tariffs so they can compete -- in other words a level playing field -- is huge. But it’s huge for every farmer in the United States.

That’s why you begin to understand that the real success of the Doha Round is in market access. That’s what studies have concluded. Bringing those barriers down, bringing those tariffs down so your farmers have a level playing field here in India, but farmers around the world have a level playing field and we have truly not only free trade but fair trade.

Zee Business TV: You just said that sometimes farmers do need subsidies in the US, so why would you want the Indian farmers to cut their subsidies?

Secretary Johanns: What we are looking for, again, is a balanced package. This doesn’t happen in isolation. This is not a situation where we came to a country, whether it’s India or Great Britain or Ireland or wherever, and said now you’ve got to carry the whole burden of this. Not at all. We all have to be a part of this. We all recognize that we have to give something to make this successful.

Our position has been very very clear, and again very respectfully I say this. Protecting 98 percent of the marketplace pretty well shuts the market. That’s really not a negotiating position that in my judgment will get us to a successful round. But we are here, quite honestly, to do all we can to work with farmers here. There isn’t any reason why agriculture can’t continue to enjoy success here.

The other thing I would tell you, I think Indian farmers appreciate the international marketplace. After all India is selling more agricultural products to the United States than we are selling to India. India has had more success with the United States market than the American farmer has had with the market here in India.

Now having said that, that’s a good thing. We like the idea that our consumers can buy products from around the world. But I would tell you, our farmers are saying also, let’s get a level playing field. In many parts of the world tariffs are very high, barriers are nearly impossible to overcome.

Zee Business TV: Do you plan to visit an Indian village to really get a full account experience of the [inaudible]?

Secretary Johanns: Yes, I spent the weekend doing that, as a matter of fact. I went to a location where they were selling grain and literally observed an auction. I have to tell you, it was a wonderful experience. I believe the whole village turned out to greet me. There were little children there, there were young people, old people. It was a great experience.

We also took the time after that to visit a farm where a father and mother and their three sons were farming together and they showed me what they were doing and they were very very proud of what they were doing. We visited at length.

After visiting the fields and observing what they were doing and talking about some of the challenges that they face, some of the things they’re doing to meet those challenge. We then went back to their home and spent time there. Again, just spent time talking about their life, what they go through, and some of their challenges. So I have done that.

Zee Business TV: The number of suicides that Indian farmers see has been increasing over the years. A number of [inaudible]. Don’t you think if subsidies are cut for them it will be even worse?

Secretary Johanns: Again, we aren’t here to say India should do this or that. We are here to ask India to participate in the Doha Round and to do everything they can as we should do to be flexible and accomplish a successful Doha Round.

Actually our discussion with India has not been so much on subsidies for Indian farmers. Our debate has been about market access and special products and that sort of thing. So those are some of the things that we have talked about in the negotiations.

Let me just also say, you’ve mentioned suicide. I can’t think of anything sadder. I just can’t think of anything sadder. That somebody would literally get to a point that they take their own life.

The suicide rate, interestingly enough, per capital with rural areas in the United States and India is about the same. It is an enormously sad thing, whether it is in the United States or India or some other part of the world, that someone would become so desperate, so saddened, that they felt there was no other alternative to commit suicide.

I will tell you as somebody who has worked in this area very extensively as a Governor and trying to help farmers, it is an enormously complex issue. What drives people to this is an enormously complex situation. But fundamentally, again, whether it’s here in India, whether it is somebody I know in the United States, whether it is a farmer I represented in Nebraska. Under any circumstances death by suicide is enormously sad.

I wish I could give a succinct, very direct explanation as to why people get to that point, but again, having worked in this area many many years, having tried to bring reform to this area, I can tell you there is oftentimes a multitude of very very complex issues at work. Whatever we can do in that area when I was Governor we would try to do because it has such a terrible, terrible impact on the families.

So I just want you to know that it’s not something that I’m unfamiliar with. I’ve actually done a tremendous amount of work in this area through the years and I just think it’s one of the saddest things there is.

Zee Business TV: What is the one suggestion that you would want to give to the Indian government to actually include the [inaudible] agreement on?

Secretary Johanns: One suggestion would probably be over-simplifying a situation. I think there are a number of things, but if I really were asked to say, my focus on one thing that you think over time can make a big impact. That item would be the ability of farmers here in India to have access to market where they can take the products that they grow so well here and sell those products into the international marketplace. It truly is the mango situation, but we could go on and on and talk about the many products that are raised here that Indian farmers would really benefit if they could --