The Shrimp Game

Monday, April 25, 2005

THE JOSTLING among Asia's powers is heating up at a time when the Bush administration's ability to manage the tensions is complicated by trade friction. It's hard to send clear signals on the geopolitical front when the administration is also anxious to pry open Japan's beef market, coax China into revaluing its currency and contain tensions with India on high-tech "off-shoring." Some of this complexity may be impossible to escape. But the administration and other power centers in Washington need to avoid loading up the Asian agenda with more distractions than necessary.

This is the context for a decision that the International Trade Commission is expected to issue today. The ITC has to decide whether to stick to its January decision to impose punitive tariffs on India's shrimp fishermen or to consider reversing itself in light of the December tsunami. In a narrow legal sense, the case turns on whether the destruction of 88,000 Indian fishing boats and 200,000 nets vitiates the threat to U.S. shrimpers posed by Indian "dumping." But the narrow issue is not the only one that ought to count. It would be nice if the court felt able to recognize that cheap imports are a boon to U.S. consumers and that one of the rules under which Indians are said to be dumping has been pronounced illegal by the World Trade Organization. It would be even better if the dumping statute allowed the court to recognize the broader ramifications of penalizing India's fishermen.

After years of protectionism and anti-Americanism, India has opened its economy since 1991 and grown friendlier to this country. But its market reforms are frequently criticized at home for not helping the rural poor. Even though the countryside has done better in the reform era than in the past, some areas have inevitably fared poorly. If the United States is seen to be hitting tsunami-affected fishing villages with punitive tariffs, it will harm the cause of pro-American market reformers, complicating the Bush team's efforts to get India's help in handling a rising China.

And all of that, for what? For the victory of imposing a quasi-tax on U.S. consumers that the WTO may rule illegal anyway?

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