I recently read Rohinton Mistry’s ‘Family Matters’ and everytime he said “Yezad” I was thinking “YazadJal”!

Oh maybe I’m being too influenced by the Internet :-$

Wouldn’t it be better if they are given access to education, so they find themselves eligible for better paying jobs in the cities? Wouldn’t they migrate voluntarily? And this IS happening, gradually, even as we speak.

Unfortunately there is some cyclical unemployment within the urban poor even today. I happen to know kids who can name the 9 planets from Mercury to Pluto, who have to work construction-jobs at a day-laborers wage. Adding the whole mass of rural poor to this mix - would unnecessarily lower their living standards.

But this is only at face value: if you look further, you see that a society with 60-70% of its workforce engaged in agriculture is doomed to low productivity and per capita income. They HAVE to be weaned away from agriculture. This and pressures on price would force efficiencies and aggregation (scale).

Do you also want to say that such an increase in the productivity and per capita income of large sections of Indian Society — a transformation out of a third world country basically — is also a bad thing?

I’m against levying tariffs for subsidies like Japanese subsidies of Airplane parts, etc. But adjusting to (EU & US) agricultural subsidies would be painful for thousands of Indian families. And the benefits would be marginal anyways.

Well, as Bastiat put it: “Something Else”! We cannot say exactly what, but they would do something else in the expanding economy, where savings on transport and food would translate to increased spending on other goods.

I sometimes think of the thousands and thousands of Morse Code-wallahs emplyed in telegraphy, made redundant by SMS. What will they do now? Well, “something else”. As simple as that.

Firstly, our excess produce, presently rotting in FCI godowns, can be exported - earning us easy money. Why give this up?

Secondly, if we remove our anti-dumping tariffs, it is true, prices would drop in the short-run, and increase our standard of living. But subsidies being subsidies can be lifted anytime- raising prices arbitrarily and creating political instability back home. No government would want to live through that.

Thirdly, the Opposition would give the goverment tremendous flak if it slipped up here. Politically, backing out now would be suicide.

And why back out of a battle you’re winning? We’re doing pretty good at the WTO; the West agrees with us on principle. It is just a matter of time. The subsidies will go.

7 x 6: It’s more like the Devil that’s offering you stuff for free. You have to think twice about what’s at stake.

As a thought experiment say a benevolent God gives all the goods we want for FREE. This God is an even worse offender than the Chinese for even the subsidized Chinese goods cannot compete with free goods. Should we tell the God — hey we don’t want your free goods and/or we’ll put tarriffs on your free goods for Indian goods cannot compete with your free goods.
If that sounds silly, so does your argument.