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A day before the World Trade Organization (WTO)’s trade negotiations committee meets in Geneva, India on Wednesday said during the negotiations, it would stick to its stand on food security.
Speaking to reporters here, Commerce & Industry Minister Nirmala Sitharaman said, “Our position remains intact…we will underline the fact that India has a sovereign duty to protect its poor. India has a sovereign right to hold foodgrain for that purpose. Therefore, our negotiations with WTO will be on reiterating this position.”
In July, India had clarified it wouldn’t ratify a trade facilitation agreement until a permanent solution on food security was arrived at. It had asked WTO to amend the norms for calculating agriculture subsidies so that it could continue to procure foodgrain from farmers at the minimum support price and sell these to the poor at cheaper rates, without violating norms.
WTO norms limit the value of food subsidies at 10 per cent of the value of overall foodgrain production. However, the subsidy is computed after taking into consideration the prices two decades ago. India is seeking a change in the base year (1986-88) for calculating food subsidies. It also wants the calculation to factor in inflation and currency fluctuation.
There is apprehension once India completes implementing its food security programme, it could breach the 10 per cent cap. In case a member country drags India to WTO, it might lead to imposition of hefty penalties. According to a WTO filing, India has given farm subsidies of $56 billion. Of this, $13.8 billion (for 23 commodities, including rice and wheat) has adversely affected trade, the WTO says.
An official said in 2010-11, India’s food subsidy towards paddy stood at only six per cent of the commodity’s overall output, in terms of value.
On September 22, WTO chief Roberto Azevêdo had expressed concern over the fate of the Bali package, saying the deal was “at risk” and the future seemed “uncertain”.
The meeting of the WTO’s trade negotiations committee on Thursday comes ahead of a meeting of the WTO’s general council. The meeting of the council, the WTO’s highest decision making body, is expected to be held in Geneva on October 21.
The mandate for commencing negotiations for the trade facilitation agreement, as part of the larger Doha Development Agenda, was decided in 2004. Member countries agreed to sign an agreement in this regard at the ministerial meeting in Bali in December 2013. However, the deal could not be signed the July 31 2014 deadline, as India sought concessions on stockpiling of foodgrain.
