244. Telegram From the Department of State to the Embassy in India1

1866. Your 12062 and 1207.3 Joint ICA/State/USDA.

[Page 517]
Appreciate Country Team imaginative thinking concerning Indian food problem and possible solution. Agree critical food situation and appointment new Food Minister4 provide excellent opportunity assist India in attack on fundamental economic problem to mutual benefit both countries. We certainly wish maximize assistance to India in achievement greater food output and in meantime tide country over anticipated food shortages. For short term believe objectives GOI and Patil will be met by 3 million tons wheat in recent Title I agreement.
Prepared consider sympathetically any request which GOI might propose for Title I PL 480 program which would constitute a long-term undertaking provide surplus commodities (mainly wheat) to support its food production program and Third Five Year Plan. Would be prepared support such program provided it understood that (1) annual amounts would be reasonable in terms past experience and estimates of requirements during the period, including realistic additions to stocks, (2) there would be mutually acceptable usual marketing commitments reviewed annually, determined in the light of India’s foreign exchange position and other related factors, (3) consultations with other principal supplying countries would be carried out, and (4) the amounts specified would be subject to the availability of Title I authority under PL 480.
Subject to annual agreement on points specified in preceding paragraph we have in mind program up to 3 million tons a year and we would be willing consider 3 to 5 year term.
While the adoption by India of an adequate food program is not a condition to long term agreement we continue to be concerned with gap between food production and consumption in India. In this connection we would appreciate receiving from Indian Government its plans to increase production with particular reference to price disincentives, provision of fertilizer, equipment and supplies to farmers, expansion of fertilizer production and extension services and farmers cooperatives.
Use both PL 480 grant and loan funds should be carefully programmed with maximum emphasis agricultural program along lines proposed reftel although believe better water use and drainage higher priority than extension irrigation facilities. Requirement for carefully prepared program justification for Presidential waiver for grant should facilitate advance planning of local currency uses. Question distinctive identification projects can be considered later when GOI attitude explored.
To assure US TC and LC expenditure being utilized effectively CT should urge GOI agreement in principle (a) accepting throughout life of project (subject availability funds) agreed number of technicians and participants (b) providing adequate Indian personnel, land and other facilities as necessary and (c) developing definite work plan. Project administration should provide that GOI delegate authority and accountability for project results to responsible Indian official.
In view world-wide demands for TC probably necessary make some shift emphasis Indian TC program rather than adding full amount additional agriculture TC effort to it. Likely only major Indian effort would command sufficient support for greatly increased agricultural TC program.
USDA and Land Grant Universities now cooperating supplying personnel and training participants. Believe present arrangements sufficient and separate new organization to operate agricultural program in India not necessary or desirable since would present administrative difficulties.
Willing give favorable consideration Benson5 invitation to Patil to visit US at convenience both. Re Canada and Australia any direct representations by GOI now would be premature. We consult other exporters only after Interagency Agreement in principle on any proposal. Make clear that following such consultations USG takes all views into account but final decision on usual marketings is made by USG.
Further instructions re 104(e) grants now being prepared. Expect soonest.
  1. Source: Department of State, Central Files, 411.9141/11–2059. Confidential; Priority. Drafted by George F. Hazard of the Commodities Division (CSD), Office of International Resources (OR), and cleared in substance in NEA, E, and ICA.
  2. Telegram 1206, October 3, a Country Team message, set forth recommendations for U.S. assistance to the Indian food and agricultural programs. It pointed out that the general political atmosphere had never been better for the advancement of U.S. influence and the acceptance of U.S. views, and offered specific recommendations for an expanded P.L. 480 program in India. (Ibid., 411.9141/10–359)
  3. In telegram 1207, October 3, Ambassador Bunker stated that he believed the proposal put forward by the Country Team in telegram 1206 was worthy of prompt and serious consideration for a number of reasons. Among the reasons he listed was the possibility that the United States “could make a major contribution to a concerted attack on India’s most fundamental economic problem, namely the need for increased food supply for its people.” (Ibid., 411.9141/10–359)
  4. Sadeshiv Kamoji Patil had recently been appointed Minister for Food and Agriculture.
  5. Ezra Taft Benson, Secretary of Agriculture.