Farm panel for Indian Trade Organisation

The National Commission on Farmers (NCF), headed by noted farm expert M S Swaminathan, has suggested setting up of an Indian Trade Organisation (ITO) with its own boxes for domestic agricultural support on the model of the Blue, Green and Amber boxes of the World Trade Organisation (WTO).

It has strongly recommended segregation of subsidies to farmers into two categories ""- those meant for providing life and livelihood saving support to small farmers and those which could be deemed as trade-distorting in the global market.

These suggestions have been mooted in the third report of the NCF submitted to the government recently. The commission was set up in November 2004 to go into the various issues related to food, agriculture and allied fields.

It said that the proposed ITO could be a virtual organisation, specialising in WTO affairs. As such, it could serve as a brain and information bank for enabling the government to take informed and proactive decisions.

Besides, it could provide timely advice on potential surpluses and shortages in major agricultural commodities by maintaining a constant watch on trade.

"The ITO will help build a long-term memory system in relation to home and external trade and help checkmate adverse global trade trends by stimulating timely national action," the NCF said in its report.

The ITO should serve as a friend and guide to small farm families and provide proactive advice on land use and crop planning.

It should help to save resource-poor farmers from the onslaught of the subsidy, technology and capital-driven agri-business paradigm of developed countries.

Besides, the ITO should help to impart trade and quality literacy through a national network of village knowledge centres. It should also monitor the arrangements for sanitary and phytosanitary measures and ensure that the globally accepted Codex alimentarius standards for food safety are maintained, the NCF said.

"Without the support of appropriate institutional structures, farm families will face increasing distress," the report stated.

Justifying the need for ITO, the commission pointed out that the total exports of agricultural products, estimated at Rs 34,654 crore in terms of value in 2002-03, constituted only a small proportion, about 6.18 per cent, of the total output of this sector which was reckoned at Rs 5,60,516 crore in that year.

India had a large home market and, therefore, needed to segregate its modest farm subsidies into global trade distorting and non-trade distorting.

In a globalised economy, there was a need to develop appropriate institutional instruments and policies to safeguard the livelihood of nearly 70 per cent of the population, it said.