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India will now coax the World Trade Organization (WTO) to take forward talks regarding public stockholding for food security purposes and has narrowed its list of demands to enable signing of the Trade Facilitation Agreement (TFA).
“I am confident that India will be able to persuade the WTO membership to appreciate the sensitivities of India and other developing countries and see their way to taking this issue forward in a positive spirit,” Commerce and Industry Minister Nirmala Sitharaman told the Lok Sabha here on Tuesday.
As the WTO Secretariat, based in Geneva, is observing a month-long summer break, India is planning to resume the talks once it reconvenes from September. Sitharaman said a permanent solution to India’s and other developing countries’ food stockholding and subsidies programme is a must and that it cannot wait “endlessly in a state of uncertainty, while the WTO engages in an academic debate on the subject of food security” hinting towards the two proposals made by the US on food security issue.
The US, it is learnt, had forwarded a couple of communiqués to India on food stockpiling issue after the Bali ministerial, which the Indian officials rejected stating that these only underlined the food security programmes of other countries in a case study format and not a strategy on how to approach the issue. Meanwhile, India has narrowed its demands to only a couple of issues. Previously, when the WTO General Council met on July 24-25, India had put forward four demands under public stockholding for food security purposes, senior commerce department officials told Business Standard.
On July 31, the deadline to sign the TFA Protocol, India’s ambassador to the WTO, Anjali Prasad, had presented a “textual proposal” to WTO Director-General Roberto Azevêdo for consideration. The options that India gave were, first, revision of the external reference price (ERP) based on which farm subsidy is calculated, by WTO norms, to a more recent period taking into account the rise in inflation. At present, the ERP of 1986-1988 is taken into consideration for calculating the amount of subsidies provided by each member country. Second, as an alternative, India had asked WTO to allow it to take advantage of the ‘Peace Clause’ till the time a permanent solution is arrived at and not restrict it till only December 2017, as was agreed in Bali.
“Without a permanent solution, public stockholding programmes in India and other developing countries will be hampered by the present ceiling on domestic support, which is pegged at 10 per cent of the value of production, and is wrongly considered as trade-distorting subsidy to farmers under existing WTO rules. The existence of such a subsidy element is determined by comparing present day administered prices with fixed reference prices of the 1986-88 period which is unrealistic,” Sitharaman added.
She also said India was forced to take such a stand, wherein it had to postpone the signing of TFA because there was “resistance” on the part of the developed countries to take the talks on food security forward.
“Public stockholding is a widely used means to ensure food security in many developing countries where agriculture is largely rain-fed,” Sitharaman highlighted.
Meanwhile, China and South Africa, who had deserted India recently, have come out in the open supporting India’s stance. However, last month India was officially supported only by Bolivia, Cuba and Venezuela.
Ajay Shriram, president, Confederation of Indian Industry (CII), said, “A great amount of effort has gone into clinching a balanced Bali deal. Hence it must not be wasted and all efforts must be made to use Bali Ministerial outcomes as springboard to conclude the Doha Round, which is into its 13th year of negotiations.”
