NEW DELHI: Five major agriculture producers led by the US have accused India of providing support to its rice and wheat producers far in excess to what the World Trade Organisation (WTO) rules allow, an allegation which has been rejected by Indian representatives in Geneva as baseless.
The counter-notification on the issue was brought by the US on behalf of Canada, Argentina, Canada and Ukraine at the meeting of the Committee of Agriculture at WTO and the points made in the document were promptly rebutted by India. The counter-notification came in response to India’s submissions that notified the WTO the level of its farm subsidies.
In a communication to the WTO, the US using the publicly available data had said that the overall support by India to its rice and wheat farmers exceeds 87% and 67-75% of the overall production value. This support far surpasses the 10% limit for developing economies under WTO rules, the communication had said.
“India rejected the counter-notification as a baseless accusation, defending its compliance with WTO obligations and highlighting unclear or absent definitions in the Agreement on Agriculture regarding certain elements of notification calculations . It also criticized the reliance on outdated reference prices and emphasized the need for their update,” a statement from the WTO said.
The US and its group of four also got support for the counter-notification from other countries. “Some also raised concerns about the negative effects of India’s policies on rice producers in developing nations, given India’s significant role in global rice and wheat markets,” the statement said.
Under the WTO rules, the food subsidy bill for developing countries should not breach the limit of 10 % of the value of production based on the reference price of 1986-88. India is seeking a revision of the base year to account for inflation and the matter is pending at the trade body.
The US also cited discrepancies in India’s reporting methodology and inconsistencies with WTO requirements. For compiling the data in its counter-notification the US had used data from 2021-22 and 2022-23.
India, however, has notified the WTO that while the value of India’s total production of rice stood at $ 52.8 billion in 2022-23, a subsidy worth $ 6.39 billion was given to farmers during the marketing year.
India has time and again called on WTO members to find a permanent solution to the long-pending public food stockpile issue, saying it is directly related to achieving the sustainable development goal of zero hunger by 2030. In absence of a permanent solution the countries have a “peace clause” without any date of expiry. Under the peace clause the domestic support cannot be disputed at the WTO so whatever be the dispute and level of support the Indian government can continue with subsidies and procurement at Minimum Support Prices (MSP).
Source: The Financial Express
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