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US now targets India, China over oil prices

world Updated: May 07, 2008 03:05 IST
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After President George W Bush's remarks linking Indians' food habits to rising prices of commodities globally, the US is now faulting India and China for the surge in oil prices to record levels.

The White House also sought to calm the frayed nerves in India to Bush's remarks that the rising prosperity of its large middle class is contributing to rising foods prices around the world saying the US saw "higher living standards" of people there as a "good thing".

"Many developing nations like India or China are having greatly increased demand, which obviously is having an impact on price," White House Deputy Spokesman Scott Stanzel said at a briefing responding to a question on the crude oil price crossing USD 120-mark.

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"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," he said.

Asked to clarify Bush's remarks on Indian's food habits, Stanzel said "We think that it is a good thing that countries are developing; that more and more people have higher and higher standards of living."

However, he apparently did not go back on Bush's point that Indian food habits were contributing to spiralling food prices, 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."

Defence Minister A K Antony had dubbed Bush's remarks as a "cruel joke" while all the major political parties reacted angrily to it.

Three days back, Bush 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.

On the Energy crisis, he stressed that it was important for the US 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".