*High oil price? Blame India and China, says Bush!* *Tuesday , May 06, 2008 * http://www.expressindia.com/latest-news/India-China-responsible-for-rising-oil-prices-US/306045/<http://www.tribuneindia.com/2008/20080507/main4.htm>
Close on the heels of President George W Bush's remarks linking Indians' food habits to rising global prices of commodities, the United States has now partly attributed the surge in oil futures to the increased demand in India and China. "There are a lot of different ways that we can reduce our dependence, but we have more to do and it's just – and also I would point out that, obviously, the demand for oil is growing around the world," White House Deputy Spokesman Scott Stanzel said in a briefing. "Many developing nations like India or China are having greatly increased demand, which obviously is having an impact on price," the senior White House official said responding to a question on the crude oil price crossing USD 120-mark. The senior White House official stressed that it was important for the United States to become less dependent on foreign sources of energy. Highlighting the need for "domestic exploration", he said. "We also have to do more in terms of building refineries. We haven't built refineries in about 30 years". Stanzel also spoke regarding Bush's remarks, which have drawn a lot of flak from every section in India, saying the United States saw "higher living standards" of people there as a "good thing". "We think that it is a good thing that countries are developing; that more and more people have higher and higher standards of living," he said. However, he apparently did not go back on Bush's point that Indian food habits were contributing to spiralling prices of commodities, which in turn, were worsening the global food crisis. "The point that I think was to be made is that as you increase your standard of living, the food that you eat can venture more into meats that require more commodities to feed the livestock which, you know, uses more of those commodities, whether it's corn, or wheat, or other commodities and it drives up the price. So that is just a function of how those food prices that we've seen spike around the world," Stanzel said. Three days ago, Bush had specifically took the case of Indian middle class to argue that its demand for better nutrition was a factor in pushing the global food prices up. "There are 350 million people in India who are classified as middle class. That's bigger than America. Their middle class is larger than our entire population. "And when you start getting wealth, you start demanding better nutrition and better food, and so demand is high, and that causes the price to go up," Bush had said. Meanwhile, the senior White House official also defended US policy on biofuels saying it was having just a "small impact" on the rising prices of food commodities. "There's been a lot of discussion about biofuels and the impact that biofuels have on increase food prices around the world. As you'll see here, over the last year, food prices have increased about 43 per cent around the world. "Of that portion, an increase in the biofuel production, about 1.5 per cent of that is due to an increase in biofuel production," he said. "So the fact that we are making more biofuels so we reduce our dependence on foreign energy has an impact, but we believe it is a small impact," he added. +++++++++ *US clarifies Bush remark on food crisis Ashish Kumar Sen writes from Washington* Wednesday, May 7, 2008 http://www.tribuneindia.com/2008/20080507/main4.htm The White House on Monday sought to cool passions in India ignited by President George W. Bush's remarks that an increased demand for food in India had contributed to the global food crisis. White House spokesman Scott Stanzel said the point Bush was trying to make was that "as you increase your standard of living, the food that you eat — it can venture more into meats that require more commodities to feed the livestock, which uses more of those commodities, whether it's corn or wheat or other commodities, and it drives up the price. So that is just a function of how those food prices that we've seen spike in the — around the world." Last week Bush, citing India as an example, said, "Their middle class is larger than our entire population. And when you start getting wealth, you start demanding better nutrition and better food, and so demand is high, and that causes the price to go up." The comments created an uproar in New Delhi. But Stanzel was quick to clarify that a growing middle class is a "good thing." Nicholas Minot, senior research fellow at the International Food Policy Research Institute in Washington told The Tribune, "Rather than blaming India and China for purchasing more food than they used to we need to focus on what can be done to meet those increasing demands." Analysts say the focus on producing bio-fuels, a so-called green alternative to gasoline, is in part to blame for the food crisis. Stanzel agreed, "As you'll see here, over the last year, food prices have increased about 43 per cent around the world," he said, adding, "Of that portion, an increase in the bio-fuel production, about 1.5 per cent of that, is due to an increase in bio-fuel production." The other causes for rising food prices, he said, was "increased demand, increased energy prices, or weather-related problems in Australia or in Eastern Europe - problems with wheat production, as an example — that's driving up the price of those commodities." With rising gasoline prices, there is an increased interest in bio-fuels. Yet this alternative takes a heavy fuel on the food market as maize that would otherwise have been used to produce corn syrup or animal feed is diverted toward producing ethanol.
