by Suman Sahai, The Asian Age
A new colonialism is underway. Rich, food-importing countries are grabbing the world’s farmland for captive food production for their people. China, South Korea, Japan, as well as Saudi Arabia and the Arab states are the new colonisers. Africa, with its large land mass, fertile land in most places and abundant water, is a target, like India, with its fabled wealth that once was. Only this time, India is joining the ranks of the land grabbers, not on the same scale as the biggies but India, too, is acquiring land in Africa.
The tragedy of Africa is that it remains food insecure despite its fertile farmlands, receiving food-aid from UN agencies like the World Food Programme. Ethiopia, which is aggressively promoting the lease out of its land to foreign investors, receives food aid worth $115 million but its lands generate cereals worth $100 million for Saudi Arabia. Ethiopian land produces food for foreigners but cannot do the same for itself! Similarly, Sudan which receives as much as $1.6 billion worth of free food from international agencies, grows wheat for Saudi Arabia, vegetables for Jordan and its own staple food, sorghum, for animal feed in the United Arab Emirates.
The food crisis of 2008 and high food inflation brought home to many how fragile the global food situation can be, not just for the poor but also for the rich who do not have sufficient land to grow the food they require. When global food commodities disappeared from the international market as a result of factors like speculation leading to hoarding, diversion of foodgrains like corn and soybean to biofuels and increased demand for animal feed, the rich food-importing nations realised that it was not sufficient to have money. To be food secure, they decided, they could not depend on international food stocks but must have control over food production directly.
If they did not have enough land in their sovereign territories, they would simply acquire this land elsewhere, produce the food there and ship it home. This would allow them to bypass global food markets and the volatility associated with them in the recent past. It is estimated that in the last few years, up to 20 million hectares of land are either already leased or are being negotiated for lease.
This new colonialism takes forward the trend of the last centuries. The 19th century Europe took over large tracts of farmland in Africa for coffee and cocoa plantations. US-based fruit growing conglomerates appropriated farmland in South and Central America and in Southeast Asian countries like the Philippines to produce bananas, pineapples and other tropical fruits for the world market. The farmland grab of today is fundamentally different though. Earlier it was cash crops and a means to wealth generation, today it is based on straightforward food security instead of revenue generation. Food-importing countries are seeking the first instance to secure food supplies for themselves.
Not just the wealthy countries, others have also joined this exploitation of global farmland. South Africa, it is reported, could negotiate a deal to lease 10 million hectares from Congo and Java-based companies in Indonesia are trying to occupy land in Indonesian islands like Borneo and Sulawesi. In neighbouring Pakistan, the government is offering farmland to (largely) Arab investors. Government-backed roadshows are being held in the Gulf state, offering extremely generous tax incentives to attract investment. Given the state of the country’s domestic security situation, an additional bonus that Pakistan offers is a one lakh strong security force to protect the foreign investments.
India too is in the thick of the land grab. Indian companies have found a way out of the land ceiling laws in India to build vast agriculture operations in Africa where there is no ceiling on land ownership. Building huge agriculture empires is not possible in India, but it is in Africa. The Indian government supports this move and provides soft loans and reduced import duties to enable the shipment of agriculture produce to India. Indian farming companies have bought thousands of hectares of land in Africa and are growing rice, maize and pulses which they sell to India.
These companies have invested upwards of $2.4 billion to buy up farmland in Ethiopia alone. Karuturi Global, a Karnataka-based company is one of the biggest land owners in Africa, where it grows cash crops like sugarcane and palm oil, as well as rice and vegetables. Not surprisingly, the backlash from people in Africa against foreign investments has begun. Karuturi is one of the prime targets. Activist groups are calling the investments a “land grab” taking away the entitlements of the African people. They say such alienation of land will deprive local people of their livelihoods leading to destitution.
They have a point.
There is a fear that the foreign investments in food production will end up hurting farmers as corrupt local governments allow the land to be leased out without building in any securities for the land owners. These could often be small farmers with little idea of what has been negotiated or what would be the terms of getting their land back. Would the land owner have some right to the food that is produced on his land? Would the local community have preferential rights to access the food or could it be all exported without leaving anything for the local people? Who would ensure that the land is not degraded during the lease period and that it is returned to the owners in a healthy state? Such investment deals have been notoriously non-transparent in most cases so far.
If this form of land leasing is to be made fair and sustainable, and if the small landholders are also to benefit from it, a code of conduct must be formulated. This could be done by bodies like the UN Food and Agriculture Organisation. They should define the terms and conditions under which land is made available for contracted food production. There must be a consultative process with not just the governments but with the land owners directly and the terms and conditions must be made clear to them. Prior Informed Consent, a feature of recent negotiations determining access to resources, as for instance in the Convention on Biological
Diversity, must be made standard features in all such arrangements, before a deal can be finalised. The international community must put its weight behind compliance of the code of conduct in both the host and investor country so that such deals do not become tools of exploitation, depriving the poor and hungry and robbing them of the chance to ever become food secure.