export quotas, as countries keen to expand their own export opportunities are likely to undercut established producers.

3.1.3     National policy trends
Within the ESAP region there are a number of differences in national policy. In OECD members, Japan and the Republic of Korea, there is a strong protection to their rice produc­ers, often justified on the basis of national culture, or tastes. For Australia and New Zealand exports of agricultural commodities (including livestock) are an important source of national income. They, along with other members of the Cairns group press for removal of restrictions on trade.
     In developing Asia, there is a difference between East and Southeast Asia and South Asia. In most of East and Southeast Asia the proportion of the population dependent on agriculture has come down substantially over the last few decades. Among them, for Thailand and Vietnam, ag­ricultural exports are important but account for a declin­ing share of total exports, as manufactured exports have increased. But in Indonesia and the Philippines there is a large proportion of population still dependent on agricul­ture, more like the picture in South Asia, where there is still something like 50% of the population dependent on agricul­ture as the mainstay of their livelihoods. The high numbers of people dependent on agriculture and the relative stagna­tion in agricultural technology and yields, along with insuf­ficient growth of labor-intensive manufactures have made it difficult to move more people out of agriculture.
     The above differences within Southeast and South Asia are reflected in different national policies. In countries like Thailand and Vietnam there is a stress on increasing produc­tivity, so as to retain or improve their competitive positions in world agricultural trade. In China too there is a similar stress on improving productivity and moving into high value agriculture. In both cases the attempt is to improve infra­structure and provide research and technology development and marketing support.
     But in South Asia (as also in Indonesia and the Philip­pines) there is a much greater stress on protecting domestic producers, with subsidies, from international competition. While there are moves to diversify into high value agricul­ture, these are not as consistent. In the "Green Revolution belt" of Punjab-Haryana, continued minimum price support to wheat and rice continues to stall attempts at diversifica­tion, as the rates of return from assured grain prices inhibit a shift towards more risky, if higher return, crops (Joshi et al., 2004; Rao et al., 2006).
     Along with the above, there are also trends to opening up sections of the agricultural markets, for instance in cot­ton. In India this has led to a fall in cotton prices, affected as they are by competing imports from subsidized producers, like those in the US (Philip and Jenniah, 2006). "Between the period 1990 and 2005 the import of cotton lint increased at a compound growth rate of over 75%, growing in geomet­ric multiples to domestic production. The price witnessed a decline of more than 55% between the years 1996 and 2003. In terms of individual years, the prices dipped as low as US$1000 per tonnes in the year 2002," (Philip and Jen­niah, 2006). The plight of cotton farmers was compounded by the many instances of sale of spurious Bt cotton seeds. The destitution of many farmers has resulted in numerous

suicides. This has become a frequently recurring political issue.
     Overall, South Asia, in particular, has yet to work out ways to effectively deal with the opening up of agricultural markets. It is less of a problem in East and Southeast Asia, affecting a much smaller proportion of the population and where there has been more of a stress on achieving transi­tions to more productive methods of cultivation and higher value crops.
     One problem that has recently come to prominence is that of displacement of agriculturists from their lands, taken over for industrial use. In this displacement without com­pensatory jobs, small farmers and the landless, along with indigenous and tribal peoples are disproportionately repre­sented. This has exacerbated the problem of the rural-urban divide, which is part of the growing inequality in develop­ing Asia. The numerous rural protests in both China and India are witness to the social tensions caused by the grow­ing rural-urban divide in these major countries of ESAP. On the one hand, greater openness to international trade in the region and the resulting growth of Asia as a manufacturing centre of the world, have created many jobs, lifted tens of millions out of poverty and reduced the global inequality between developing Asia and the developed countries. On the other hand, there has been a neglect of the agricultural sector (after the initial first period of Green Revolution and agricultural export growth), increasing the rural-urban di­vide in the contemporary situation. The emphasis on trade has led to neglect of rural development and of non-tradable sectors of the economy.
     Policies to reduce gender equality (e.g., land rights for women, recognizing women as holders and developers of AKST); to reduce social exclusion (of indigenous and tribal peoples, low castes, minorities); to increase public invest­ment in the supply of rural and agricultural public goods, such as infrastructure (roads, communication, health and education) and policies that encourage investment in re­search for neglected and non-internationally traded crops are options to reduce the rural-urban disparity (see Chapter 5). Education and skill building can help rural poor people to benefit from the new jobs in manufacturing and services that are being created in ESAP.

3.1.4     Trends in private and public institutional roles
Some of the studies referred to in this chapter point to the weakness of "world governance on questions of corporate conduct and competition" (UNCTAD, 2006b). Whether it is competition policy or corporate governance, there has been a globalization of economic processes, but not a glo­balization of the regulatory framework. This is an impor­tant public issue that affects agriculture and trade.
     As an example, when China, as a concession to the grow­ing trade surplus with the USA, agreed to buy soya, prices of soya immediately went up from $7.70 in December 2003 to $9.82 per bushel in March-April 2004 and when China completed its purchases, the price promptly fell to $5.93 in August 2004. It was estimated by the Chinese Academy of Science (http:www.chinafeed.org.cn/cms/_code/business/ include/php/218139.htm) that China overpaid $1.5 billion on this purchase; what is of greater interest is the next part of the story. Because of the high import prices of soya, many