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Onderstaand artikel is gepubliceerd in / Published in: Commerce, 12-9-1987      

Operation Flood

Non-governmental organisations behind controversy

by:
Malcolm Subhan

BRUSSELS

Any major development project in the Third World is likely to arouse controversy, if only because there is no agreement on the basic question: What is development? (Not everyone equates development with economic growth, for example). But in the absence of agreement on such a key issue there can be no agreement on development strategies either.
It is hardly surprising, therefore, that Operation Flood should be at the centre of a contoversy in India. What is more surprising, is to find the European Community (EC), and more especially its executive arm, the European Commission, caught up in the controversy.
Of course the Community has been a major contributor since 1970. Nearly two-thirds of the funds put at the disposal of Operation Flood have come from the counterpart funds generated by the sale of the skimmed milk power (SMP) and butteroil supplied by the EC as a gift. The second largest donor, the World Bank, is well behind the EC, having so far provided a quarter of the funds made available for Operation Flood.
The controversy over Operation Flood might not have erupted in Brussels, and certainly not with such force, but for a number of non-governmental organisations. Development NGOs, and there are literally hundreds of them in Western Europe, are non-profit organisations, financed by voluntary contributions from the general public.
They span the political spectrum, although most NGOs are left-wing or have a left-wing image. Most are active in the field, where they asually engaged on small, localised projects aimed at grass-roots development. On the whole, their impact on official policy towards developing countries is slight.

Many European NGOs have been opposed to food aid, mainly on the ground that it depresses local prices and therefore discourages local farmers

By their very nature all development projects are something of a gamble. Non-government organisations, in fact, try to increase the chances of success by only backing micro-projects. For major donors like the Commission their final decision must be based on political as much as economic considerations.
from growing more themselves. It is, therefore, significant that when, in 1977, the European Commission sought the authorisation of the Community's member governments to continue supplies of SMP and butteroil to Flood II, it stressed that food aid would be used, for the first time, to support a vast rural development project.
In a resolution supporting the Commission, the European Parliament expressed the view that "this form of food aid... also pursues long-term development goals, particularly the improvement of rural structures." Since then the European Commission has frequently cited Operation Flood as a good example of the use of food aid for development purposes, and expressed its readiness to help other developing countries duplicate it.

Failing on both counts
The Commission might have secured governmental and Parliamentary approval for Community aid for Flood III just as smoothly as it had for Flood II but for the NGOs, whose hand was strengthened by a seminar on Operation Flood held in 1984. Sponsored by the Institute for Social Studies in the Hague, it included Indian critics of Operation Flood. The choice of subject matter apparently was dictated by the Institute's concern that a development project widely regarded as fostering social equality and avoiding dependence was failing on both counts - as studies conducted by its own social scientists had shown.

Had the NGOs, prominent among them the India Committee of the Netherlands, a non-fund raising voluntary organisation "in solidarity with the oppressed in India," confined themselves to pressing the Europan Commission to end its support for Operation Flood, they probably would have made little impact. Mr. Claude Cheysson, the European Commjssioner directly involved, is highly regarded in official circles, as one who is in sympathy with the aspirations of developing countries and enjoys their trust. He is the author, after all, of the original Lome Convention and, more recently, architect of the European Communuty' s policy towards Central America.
Mr. Cheysson could have shrugged aside NGO - and academic - criticisms of Operation Flood. A strong-willed personality, he is not in the habit of tolerating outside criticism. Not for the first time, he could also have ignored the critics of Operation Flood among his officials. He could simply have asked the EC member governments and European parliament to authorise continued food aid for India - i.e. shipment of SMP and butteroil for Flood III - especially as the World Bank seemed ready to support Flood III.
There are a number of reasons why this path was not followed. One of the most important was the attitude of the European Parliament. The NGOs have been pressing the members of the European Parliament (MEPs) for the last two years to demand an end to further Community aid for Operation Flood. And enough of them have lent an attentive ear to force the issue into the open in Brussels, where the EC's decision making apparatus is centred.

Least significant Parliament
A word about the European Parliament is needed at this point. Of the four key Community institutions - European Commission, Council of Ministers, Parliament and Court of Justice - the Parliament is the least significant, simply because it has the fewest powers. Clearly a democratic Community requires a strong and effective Parliament. The fact that this Parliament is neither, merely shows that the goal of European integration is still a long way off.
The European Parliament's limited powers do extend to the EC's development aid budget. Its Committee on Development and Cooperation is not without influence, therefore, although its major area of interest is the Lome Convention, linking the EC to 66 developing countries in Africa, the Caribbean and the Pacific. Lobbying the European Parliament is much easier, moreover, than lobbying national Parliaments, the Council or even the Commission. The plain truth is that MEPs, having the trappings of power with few of its responsibilities, offer an ideal target for lobbyists, while their lack of experience or expertise on foreign policy issues makes them an easy target.
It is a safe bet that few MEPs had even heard about Operation Flood, and that fewer still knew enough about it to participate effectively in

It is hardly surprising that Operation Flood should be at the centre of a controversy in India. What is more surprising is to find the European Community and more especially its executive arm, the European Commission, caught up in the controversy.
any debate of it. But at a time of financial stringency within the EC, Commissioner Cheysson could not afford to ignore the views of MEPs, given their influence on the size of the Community's development aid budget.

Daunting task
As a result, the Commission undertook to look into criticisms of Operation Flood before making any recommendations to the member states and Parliament as regards Flood III. It obviously was not equipped for such a daunting task; although a few Commission officials have visited India from time to time to check on the use being made of Community aid, it has relied heavily on the World Bank's audit and other reports on Operation Flood.
European Commission officials drafted a note on Operation Flood in mid 1985, setting out both its achievements and its alleged shortcomings. The latter apparently were included to reflect criticisms voiced by the NGOs but not shared by the Commission - nor, as the Note pointed out, by the Jha Committee. Given the Jha Committee's bona fides, even the European Commission could have used its report to justify support for Flood III; it could have flown out Mr. L.K. Jha himself to address the Parliamentary Committee on Development and Cooperation.
Instead, it envisaged sending a mission to India to report on Operation Flood. Meanwhile, a Danish agricultural expert was asked to prepare a report that would complement the Commission's own. He more or less substantiated the Commission's findings; but he also warned it against sending a mission to evaluate the performance of Flood II, as this could be construed as giving credence to the project's critics. The mission's main task, he felt, should be to look into the desirability of EC support for Flood III. But is could also look into milk pricing policies and get more data on the food/feed issue and on cattle breeding policies.

Another report
European Commission officials prepared a further report in early 1986. Like that of mid-1985 it was based more on information available with the Commision than recent field work by its officials. It concluded that as a development project Operation Flood had given good results so far although, like any human endeavour, there was room for improvement. The report agreed that Operation Flood should be continued, to allow its objectives to be reached, but noted that this did not necessarily imply continued EC involvement through the supply of SMP and butteroil. Such aid could only be justified if it could be shown that domestic production had not increased to the point where it could meet the growing demand for milk.
Aid donors (and this applies as much to the European commission as to EC govemments) seldom find themselves in the happy position of having all the facts relating to a development project in their possession before deciding whether or not to back it. By their very nature, all development projects are something of a gamble. NGOs, in fact try to increase the chances of success by only backing micro-projects. For major donors like the Commission their final decision must be based on political as much as economic considerations.

Issue confused further
The European Commission should have acted on the basis of its own report. However, it let itself be badgered by the criticisms of a handful of European NGOs and their allies in the European Parliament into repeatedly postponing a decision. It felt obliged, in fact, to send a mission to India last summer, in order to carry out additional research into certain aspects of Operation Flood which needed clarification for the preparation of Flood III, and to observe areas where there had been a low rate of achievement of targets.
The mission, predictably, only confused the issue further. Its report, although far more balanced than some articles appearing in the Indian press would suggest, remains a consultant's report. In other words, it it not the report of the EEC Commission/World Bank Joint Review Mission as was planned initially and has no official status.
No group of half dozen European experts, led by someone with no experience of India, could ever hope to settle once for all the con-

Many European non-government organisations have been opposed to food aid, mainly on the grounds thaf it depresses local prices and therefore discourages local farmers from growing more themselves.
troversy over Operation Flood after spending 6 or 7 weeks "in the field," in the broiling summer heat. The Commission presumably was not looking for a definitive assessment of Operation Flood but a report that would carry weight with MEPs and NGOs.
The team leader's preparation for the task included two weeks at the Institute of Social Studies in the Hague, some of whose researchers are strongly critical of Operation Flood. One of them was included in the 6-man team sent to India. His report on the macroeconomic analysis reportedly contrasts sharply with others because of its consistently critical tone.

Whose views?
Even before the team had finished its work in India the World Bank disassociated itself from its findings, so that it was no longer a joint review mission. The European Commission could not have been happy with the team's main report, written by the team leader on the basis of the reports by each of the team members. The cover of the report in fact bears the words: "Report prepared with the financial support of the Commission of the European Communities. The views expressed herein are those of the consultant and do not necessarily represent any official view of the financing Institution."

One of the report's main conclusions was that all imports of dairy products into India "should be substantially reduced or terminated," as they tend "to negatively influence the producers' market and damage transition to a viable cooperative industry." Such a sweeping conclusion is at odds with the modest claims made by the team leader on the very first page of his report:" ... the scope of the mission which was vast and the time too short for the results to be considered as a complete ex-post evaluation exercise or an appraisal for a new phase."
The paragraph from the conclusions quoted earlier, in fact, continues: "Imports might later be needed to be resumed with increased sales or in emergency situations, in order to guarantee a continuous and stable supply to urban consumers, but any action in this respect should take place after a substantial deficit has been documented."

One conclusion regarding the report itself is that it tries to satisfy everyone. It, therefore, lends itself admirably to selective quotation. Witness the following lines quoted by Mr. Claude Alvarez in his article in The Illustrated Weekly of July 19: " ... the planned and approved scale of Operation Flood II was too ambitious..." But the sentence in the report begins with the words "Notwithstanding the high standard of the operational abilities of the professional management..."
The European Commission, perhaps not surprisingiy, decided to send its own officials to India. Two of them were attached to the World Bank team which was in India this April. Following their visit the European Commission began drafting the report to be sent to the European Parliament and Council of Ministers in September, with recommendations regarding India' s request for continued supplies of SMP and butteroil for Flood III.


Informed sources here expect the Commission to recommend further shipments of SMP and butteroil, although on a smaller scale than hitherto. In support of their view they point to the Community's decision in July to provide 12,000 tonnes of SMP and 4,000 tonnes of butteroil for early shipment under its food aid programme. But the Commission may also recommend some direct financial aid, although it would be up to the member states and the European Parliament to provide the necessary funds.


The main conclusion to be drawn from the events of the past three years is that the European Commission and Community, like the European NGOs, must define their goals more clearly - and then stick to them. A strong case can be made out for the use of food aid to foster rural development. An equally strong case can be made for Community support for Operation Flood III.

Of course, Operation Flood is open to criticism, especially from the stand point of many European NGOs - because it is directly market-oriented and requires professional management by staff with strongly developed managerial and financial skills. But these are the very qualities the European Commission and most member states believe are necessary for the economic growth of developing countries. As a Commission official put it recently: Operation Flood it not aimed at helping poor farmers drink more milk but at raising farm incomes. To solve social problems, social measures are needed.



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