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LATEST NEWS UPDATES | WTO: We can't yield on food security -Amiti Sen

WTO: We can't yield on food security -Amiti Sen

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published Published on Dec 8, 2017   modified Modified on Dec 8, 2017
-The Hindu Business Line

India needs to be firm in Buenos Aires about its public stockholding programme, resisting pressure from US and Brazil

The outcome of the Eleventh Ministerial Conference of the World Trade Organisation (MC11) beginning in Buenos Aires on Sunday is difficult to predict as consensus continues to elude members on all key issues ranging from agriculture subsidies to e-commerce in the ongoing preparatory discussions in Geneva.

It is, however, important for India not to lose focus, and concentrate on the key issue of finding a permanent solution on its public food stockholding programme.

Commerce and Industry Minister Suresh Prabhu, who will lead India in the talks, has to stick to his stated position that any agreement at MC 11 has to necessarily include a satisfactory permanent solution, and not waver under pressure from developed countries.

Many suggestions


So far, at the meetings of the Committee on Agriculture at the WTO, members have been floating various drafts on permanent solutions. India, as part of the G-33 group of developing countries, has demanded that public procurement subsidies in the form of minimum support price programmes should not be treated as trade distorting and be allowed without limits.

Under the present rules, trade distorting subsidies given by developing countries are subject to a 10 per cent cap and members can be penalised if it is breached.

Another proposal by the EU and Brazil links the permanent solution to an agreement on paring of domestic agriculture subsidies and also imposes stringent transparency conditions. Allowing such a linkage could be dangerous for India as it could then find itself under pressure to cut down on its input subsidies (such as fertiliser, seed and irrigation) that Article 6 of the Agreement on Agriculture allows for poor farmers.

Weak link


In the ongoing negotiations, India’s weakness lies in the onerous conditions attached to the ‘peace clause’ (which protects the country against penalties in case food procurement subsidies breach the 10 per cent mark) it bagged as an interim solution at the Bali MC in December 2015.

These include limiting the clause to traditional staple food crops and existing programmes, setting a series of notification and transparency requirements and the obligation to hold consultations upon request, and also ensuring that the stocks procured do not distort trade or adversely affect the food security of other members. While the US has stated that there was no question of going back on the obligations agreed upon in Bali, there are others such as Brazil, the EU and Russia, who are pushing for making the obligations more onerous by introducing conditions such as prohibition to export from the procured stocks.

India also has its strengths. Its greatest power comes from the fact that it managed to make the peace clause a perpetual one, following hard-nosed negotiations in 2014. This means that in case it is not offered a permanent solution to its liking, it is under no obligation to settle for one less favourable than the existing peace clause.

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The Hindu Business Line, 6 December, 2017, http://www.thehindubusinessline.com/opinion/wto-we-cant-yield-on-food-security/article9984736.ece


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