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LATEST NEWS UPDATES | Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth </title>
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NEW DELHI: The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.
The farm subsidy notification made by..."/>
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NEW DELHI: The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.
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<h1 class="cat-box-title">Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth</h1>
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Published on</span><span class="text-date"> Sep 13, 2014</span>
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<div align="justify">-The Economic Times</div><p align="justify"><em>NEW DELHI: </em>The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.</p><p align="justify">The farm subsidy notification made by India at the WTO earlier this week shows that the subsidy to rice risks exceeding the WTO permissible limit. If there is no relief on the procurement issue, the government may be unable to increase the minimum support price (MSP) for rice.</p><p align="justify"> As per data submitted after a gap of a decade, India's minimum subsidy level touched 7 per cent of the value of production for rice in 2010-11, not far from the limit of 10 per cent that could be reached by 2017. For wheat, the administered price was lower than the fixed price of 1986-88, the base on which the minimum subsidy limit is calculated.</p><p align="justify">"We will be hitting the 10 per cent ceiling for rice within a few years. That provides the rationale for India's keenness to negotiating a permanent solution for public procurement for food security," said Abhijit Das, professor at the Centre for WTO Studies.</p><p align="justify">As per the 27-page notification document, India spent $56.1 billion on support for farmers in 2010-2011. "If the 10 per cent mark is reached, then the government can either reduce MSP or reduce the quantity procured, but it will have implications on stockholding and public distribution system," said a government official.</p><p align="justify">The current WTO norms limit subsidy to 10 per cent of the total value of production of a particular crop. However, the support is calculated based on 1986-88 prices. G-33 has sought a revision of base to a more recent year or the incorporation of inflation.</p><p align="justify">India blocked the adoption of a trade facilitation pact on July 31, strongly demanding a concurrent deal on a permanent solution to public stockpiling.</p><p align="justify">India had negotiated a peace clause in Bali, a four-year window under which no country could be dragged to dispute for breaching the subsidy cap. "We will actually be requiring the exemption or the peace clause after 2017," said the official.</p><p align="justify">India's proposal on food security aims to address the problems faced by developing countries due to outdated WTO rules which base agriculture subsidy calculation on reference prices of 1986-88 even though global food prices have increased manifold since then. India has experienced an inflation of 650 per cent since 1986-88.</p><p align="justify">Administered price of rice almost doubled between 2004-05 and 2010-11 from $187 million per tonne to $329, exceeding 1986-88 reference price of $263 per tonne. The US in July asked for a review of food security and procurement schemes of developing countries.</p>
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<br><a href="http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation" class="re" target="_blank">The Economic Times, 12 September, 2014, http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation</a><div class="clear"></div>
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<h1 class="cat-box-title">Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth</h1>
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Published on</span><span class="text-date"> Sep 13, 2014</span>
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<div align="justify">-The Economic Times</div><p align="justify"><em>NEW DELHI: </em>The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.</p><p align="justify">The farm subsidy notification made by India at the WTO earlier this week shows that the subsidy to rice risks exceeding the WTO permissible limit. If there is no relief on the procurement issue, the government may be unable to increase the minimum support price (MSP) for rice.</p><p align="justify"> As per data submitted after a gap of a decade, India's minimum subsidy level touched 7 per cent of the value of production for rice in 2010-11, not far from the limit of 10 per cent that could be reached by 2017. For wheat, the administered price was lower than the fixed price of 1986-88, the base on which the minimum subsidy limit is calculated.</p><p align="justify">"We will be hitting the 10 per cent ceiling for rice within a few years. That provides the rationale for India's keenness to negotiating a permanent solution for public procurement for food security," said Abhijit Das, professor at the Centre for WTO Studies.</p><p align="justify">As per the 27-page notification document, India spent $56.1 billion on support for farmers in 2010-2011. "If the 10 per cent mark is reached, then the government can either reduce MSP or reduce the quantity procured, but it will have implications on stockholding and public distribution system," said a government official.</p><p align="justify">The current WTO norms limit subsidy to 10 per cent of the total value of production of a particular crop. However, the support is calculated based on 1986-88 prices. G-33 has sought a revision of base to a more recent year or the incorporation of inflation.</p><p align="justify">India blocked the adoption of a trade facilitation pact on July 31, strongly demanding a concurrent deal on a permanent solution to public stockpiling.</p><p align="justify">India had negotiated a peace clause in Bali, a four-year window under which no country could be dragged to dispute for breaching the subsidy cap. "We will actually be requiring the exemption or the peace clause after 2017," said the official.</p><p align="justify">India's proposal on food security aims to address the problems faced by developing countries due to outdated WTO rules which base agriculture subsidy calculation on reference prices of 1986-88 even though global food prices have increased manifold since then. India has experienced an inflation of 650 per cent since 1986-88.</p><p align="justify">Administered price of rice almost doubled between 2004-05 and 2010-11 from $187 million per tonne to $329, exceeding 1986-88 reference price of $263 per tonne. The US in July asked for a review of food security and procurement schemes of developing countries.</p>
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<br><a href="http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation" class="re" target="_blank">The Economic Times, 12 September, 2014, http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation</a><div class="clear"></div>
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LATEST NEWS UPDATES | Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth </title>
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<h1 class="cat-box-title">Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth</h1>
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Published on</span><span class="text-date"> Sep 13, 2014</span>
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<div align="justify">-The Economic Times</div><p align="justify"><em>NEW DELHI: </em>The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.</p><p align="justify">The farm subsidy notification made by India at the WTO earlier this week shows that the subsidy to rice risks exceeding the WTO permissible limit. If there is no relief on the procurement issue, the government may be unable to increase the minimum support price (MSP) for rice.</p><p align="justify"> As per data submitted after a gap of a decade, India's minimum subsidy level touched 7 per cent of the value of production for rice in 2010-11, not far from the limit of 10 per cent that could be reached by 2017. For wheat, the administered price was lower than the fixed price of 1986-88, the base on which the minimum subsidy limit is calculated.</p><p align="justify">"We will be hitting the 10 per cent ceiling for rice within a few years. That provides the rationale for India's keenness to negotiating a permanent solution for public procurement for food security," said Abhijit Das, professor at the Centre for WTO Studies.</p><p align="justify">As per the 27-page notification document, India spent $56.1 billion on support for farmers in 2010-2011. "If the 10 per cent mark is reached, then the government can either reduce MSP or reduce the quantity procured, but it will have implications on stockholding and public distribution system," said a government official.</p><p align="justify">The current WTO norms limit subsidy to 10 per cent of the total value of production of a particular crop. However, the support is calculated based on 1986-88 prices. G-33 has sought a revision of base to a more recent year or the incorporation of inflation.</p><p align="justify">India blocked the adoption of a trade facilitation pact on July 31, strongly demanding a concurrent deal on a permanent solution to public stockpiling.</p><p align="justify">India had negotiated a peace clause in Bali, a four-year window under which no country could be dragged to dispute for breaching the subsidy cap. "We will actually be requiring the exemption or the peace clause after 2017," said the official.</p><p align="justify">India's proposal on food security aims to address the problems faced by developing countries due to outdated WTO rules which base agriculture subsidy calculation on reference prices of 1986-88 even though global food prices have increased manifold since then. India has experienced an inflation of 650 per cent since 1986-88.</p><p align="justify">Administered price of rice almost doubled between 2004-05 and 2010-11 from $187 million per tonne to $329, exceeding 1986-88 reference price of $263 per tonne. The US in July asked for a review of food security and procurement schemes of developing countries.</p>
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<br><a href="http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation" class="re" target="_blank">The Economic Times, 12 September, 2014, http://articles.economictimes.indiatimes.com/2014-09-12/news/53851322_1_peace-clause-subsidy-cap-base-agriculture-subsidy-calculation</a><div class="clear"></div>
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LATEST NEWS UPDATES | Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth
Rice subsidy legroom may be the reason behind India's hard stand at World Trade Organisation -Dilasha Seth
Published on Sep 13, 2014
Modified on Sep 13, 2014
-The Economic Times
NEW DELHI: The risk of losing room to raise the minimum support price for rice possibly prompted India's hard stand at the WTO in July, which led to the collapse of trade talks.
The farm subsidy notification made by India at the WTO earlier this week shows that the subsidy to rice risks exceeding the WTO permissible limit. If there is no relief on the procurement issue, the government may be unable to increase the minimum support price (MSP) for rice.
As per data submitted after a gap of a decade, India's minimum subsidy level touched 7 per cent of the value of production for rice in 2010-11, not far from the limit of 10 per cent that could be reached by 2017. For wheat, the administered price was lower than the fixed price of 1986-88, the base on which the minimum subsidy limit is calculated.
"We will be hitting the 10 per cent ceiling for rice within a few years. That provides the rationale for India's keenness to negotiating a permanent solution for public procurement for food security," said Abhijit Das, professor at the Centre for WTO Studies.
As per the 27-page notification document, India spent $56.1 billion on support for farmers in 2010-2011. "If the 10 per cent mark is reached, then the government can either reduce MSP or reduce the quantity procured, but it will have implications on stockholding and public distribution system," said a government official.
The current WTO norms limit subsidy to 10 per cent of the total value of production of a particular crop. However, the support is calculated based on 1986-88 prices. G-33 has sought a revision of base to a more recent year or the incorporation of inflation.
India blocked the adoption of a trade facilitation pact on July 31, strongly demanding a concurrent deal on a permanent solution to public stockpiling.
India had negotiated a peace clause in Bali, a four-year window under which no country could be dragged to dispute for breaching the subsidy cap. "We will actually be requiring the exemption or the peace clause after 2017," said the official.
India's proposal on food security aims to address the problems faced by developing countries due to outdated WTO rules which base agriculture subsidy calculation on reference prices of 1986-88 even though global food prices have increased manifold since then. India has experienced an inflation of 650 per cent since 1986-88.
Administered price of rice almost doubled between 2004-05 and 2010-11 from $187 million per tonne to $329, exceeding 1986-88 reference price of $263 per tonne. The US in July asked for a review of food security and procurement schemes of developing countries.
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