In the run up to the upcoming WTO ministerial in Buenos Aires [December, 2017], ex-commerce minister, Nirmala Sitharaman has once again reiterated India’s resolve to seek a permanent solution for public stockholding programs for food security besides taking up two other proposals viz. special safeguard mechanism [SSM] against sudden surge in imports of agricultural products and movement of short-term services providers. But, India is up against heavy odds as during her recent visit to WTO, Geneva [July, 2017] , US, EU, Canada, Australia and Japan had rejected a proposal submitted by G-33 Group of developing countries in this regard. At the same time, developed countries wanted to bring to the table issues such as e-commerce and disciplines for micro, small,...
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Category: Agreement on Agriculture (AoA)
STANDING FIRM ON FOOD SUBSIDIES
With India-China having jointly petitioned WTO, it is expected that both will reach at a permanent solution to address anomalies surrounding food procurement In a joint paper submitted to the World Trade Organisation (WTO) committee on agriculture on July 17, India and China lambasted the developed countries, including the United States, the European Union and Canada for consistently giving trade-distorting subsidies to their farmers at levels much higher than the ceiling applicable to developing countries with respect to such subsidies. According to the paper, “Developed countries corner more than 90 per cent of global Aggregate Measurement of Support (AMS) — a technical jargon for trade-distorting subsidies — entitlements amounting to nearly $160 billion, which is beyond their de minimis (maximum permissible level of AMS)....
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11th WTO ministerial – should address ‘anomalies’ in AoA
In a joint paper submitted to the WTO’s [World Trade Organization] Committee on Agriculture, on July 17, 2017, India and China have lambasted developed countries including the US, the EU and Canada for consistently giving trade-distorting subsidies to their farmers at levels much higher than ceiling applicable to developing countries in respect of to such subsidies. According to the paper, “developed countries corner more than 90 per cent of global Aggregate Measurement of Support [AMS] [a technical jargon for trade-distorting subsidies] entitlements amounting to nearly US$160 billion which is beyond their de minimis [maximum permissible level of AMS]. In contrast, most developing countries have access only to de minimis resulting in a major asymmetry in the rules on agricultural trade.” The overarching objective...
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At WTO – India gets platitudes, no permanent solution
At a recent meeting of agriculture committee of the WTO [World Trade Organization] held on March 28, 2017, developed countries lambasted India on its minimum support price [MSP] programs for wheat and other key commodities such as sugarcane and pulses. While, Australia raised concerns over increase in India’s MSP for wheat since 2006, US and EU questioned subsidies on sugarcane, buffer stock of pulses and price support for both rabi and kharif crops. But, there was little movement on ‘permanent solution for legitimizing its food procurement subsidies’, an issue of great concern to India. Ever since, World Trade Agreement [WTA] came into effect in 1995, developed countries have been obfuscating the issues concerning commitments of member countries. While, on one...
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‘PEACE CLAUSE’ THAT BRINGS PROSPERITY
New Delhi should engage proactively with the WTO to ensure that issues of concern to developing countries, primarily related to agriculture, are addressed Roberto Azevedo, Director General of World Trade Organisation (WTO), who was recently in Delhi to explore and understand India’s perspective on issues for taking up in the 11th WTO ministerial scheduled for December 11-14, 2017, stated that “one has to be patient for a permanent solution and asked not to undermine the efficacy of the peace clause”. Azevedo’s exhortation is unmindful of the vulnerabilities of developing countries inherent in the ‘peace clause’. When, the provision itself stands on a slippery foundation, there is impatience. At the 9th ministerial in Bali (December, 2013), developed countries had agreed to...
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11th WTO ministerial – India must insist on permanent solution to food security
Roberto Azevedo who was recently in Delhi to explore and understand India’s perspective on issues for taking up in the 11th WTO [World Trade Organization] ministerial scheduled for December 11-14, 2017 stated “one has to be patient for a permanent solution and asked not to undermine the efficacy of the peace clause”. Azevedo exhortation is unmindful of the vulnerabilities of developing countries inherent in the ‘peace clause’. When, the provision itself stands on a slippery foundation, there is every reason for them to be impatient and hence, their search for permanent solution. Let us look at some basic facts. At the 9th ministerial in Bali [December, 2013], developed countries had agreed to a ‘peace clause’ under which, if a developing...
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Can India survive Trump bombshell?
The election of Republican Party candidate Donald Trump as the next President of the US has sent shock waves across the world. All along, America has been a strong protagonist of free flow of international trade and investment in goods and services. If Trump acts on his electoral pronouncements, this will tantamount to a reversal of the existing US policy stance. It will herald an era of “protectionism”. So what are the major areas of concern for India? President-elect Donald Trump wants American companies to operate from within the US and achieve this aim by imposing an import tariff of 35% on those who set up manufacturing facilities in other countries. Such a high tariff will seriously impact India where...
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Can India survive Trump’s bombshell?
The republican candidate, Donald Trump has been elected by Americans on the promise of protecting their interests and doing all that is necessary to achieve this goal. All along, USA has been a strong protagonist of free flow of international trade and investment in goods and services and accordingly championed liberal policies to foster this [sans a tinge of protectionism in specific areas such as agriculture]. India has benefited hugely from such open policy stance. Now, if Trump were to act on his electoral pronouncements, this will tantamount to a drastic reversal of extant policy stance. It will herald an era of ‘protectionism’ adversely affecting developing countries like India which derive a good slice of its income by doing business...
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WTO – Rhetoric cannot hide failures
Jeff Zients, Director of the National Economic Council, who is in Delhi for second “US-India Strategic and Commercial Dialogue” has said that ‘US is ready to increase engagement with India to find new common ground at WTO [World Trade Organization] and asserted that the future looks “bright” for this global trade body.” Zients who co-chairs the second US-India CEO Forum alongside the US Secretary of Commerce Penny Pritzker further noted that “the last two WTO Ministerial Conferences in Bali and Nairobi were significant successes, including outcomes on the Trade Facilitation Agreement [TFA], agricultural export subsidies, and public stockholding for food security purposes.” These euphoric statements are at substantial variance with what actually transpired at these conferences. In a brazen display...
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Permanent solution to public stock holding – India must not give up
In a severe indictment of India’s stand at World Trade Organization [WTO], the Economic Survey [2015-16] presented to parliament in February, 2016 unequivocally questioned India’s long-time stance of insisting on special safeguards mechanism [SSM] and permanent solution to its public stock holding issue. Dr Arvind Subramanian, author of the Survey and chief economic advisor [CEA] argued that the country’s strategy should instead evolve around the need to shift away from tariff armours for producers to domestic support, and that too at an appropriate level and form. He pointed out that the policies being defended are those that “India intends to move out of in any case” due to well documented impacts, including a decline in water tables and over-use of...
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