West Must Cut Farm Sops, Says India

While expressing its displeasure for not factoring in the agriculture framework submitted by 20 developing countries, India today said the agricultural reform process had to commence with the developed countries dismantling the high subsidy regime which were distorting markets in developing nations.

"The agricultural reforms process has to start with removing distortions which have brought agriculture to this level. Distortions have been brought about by domestic support and export subsidies which make farmers in developed countries produce more and depresses markets. Our protection is on account of these subsidies," Commerce and Industry Minister Arun Jaitley told reporters.

Commerce ministry officials also said that the covering letter sent to World Trade Organisation (WTO) recognised the differences on various issues but did not factor in the position adopted by a group of 20 developing countries, including India, Brazil and China.

"High subsidies in developing countries was the result of the high level of export subsidies and domestic support provided to farmers in the developed countries," an official added.

Government officials, however, refused to forecast on the progress on agriculture at the Cancun ministerial meeting starting next week with the WTO members still disagreeing on fixing the modalities for further talks.

But India was confident on tilting the balance in favour of the position of developing countries and said members of the Cairns group, which had not signed the G-20 paper, had also promised support to the stand.

Jaitley is understood have held talks with Australian Trade Minister Mark Vaile during his visit to Phnom Penh for the Asean meeting.

The officials said the European Union and the US were adopting a posture of decoupling of domestic production but there did not appear any significant change in their position.

"Both are saying that if one of them does it, the other would follow, indicating that there is no inherent recognition of the fact that subsidies have to be brought down," an official said.

They also attacked the US-EU paper saying that the framework talked about protecting subsidies on the one hand which resulted in lower market access for developing countries and at the same time recognising special and differential treatment for developing countries.