India under pressure at WTO to give up demand on food security

Developed countries such as the US and Australia have once again stepped up pressure on India at the World Trade Organisation (WTO) to sign a pact on trade facilitation without a simultaneous agreement on food security. In a meeting of the WTO Committee on Agriculture on Tuesday, Australia accused New Delhi of doing a turnaround that led to collapse of talks.

Placing the blame It pointed out at the meeting that the G-33 proposal (of which India is part) given in July called for a permanent solution on stockholding to be agreed by 2017 (the 11th WTO Ministerial Conference) as was agreed in the Bali meeting of trade ministers last December.

Australia asked India to explain why it then linked the signing of the trade facilitation protocol-an agreement to upgrade customs infrastructure and harmonise border procedures-- to finding a permanent solution on food security. India said it would explain the G–33 proposal when members start negotiating a permanent solution.

Wilful neglect? India allowed the protocol for the trade facilitation agreement to lapse on July 31, as it refused to sign it in the absence of a permanent solution that would allow it to subsidise its food procurement programmes without worrying about breaching subsidy limits. This raised the hackles of many developed countries backing the trade facilitation pact with some calling it a “breach of trust”.

Although talks have tentatively restarted in September after the summer break, members don’t seem to be in a mood to compromise. “There is no agreement yet on a post-Bali work programme,” a WTO official said. The US said that it would take longer than 2014 to find a permanent solution to the problem of food procurement. However, it could be clarified that the interim relief promised to developing countries in Bali against legal action in case of breach of subsidy limit will remain in place until a permanent solution is found. Although in Bali India had agreed to sign the protocol on trade facilitation in July, it had second thoughts later as there was no movement in talks on a permanent solution at the WTO.

India was apprehensive that once the trade facilitation agreement is signed, developed countries will lose all interest in the issue of food security.

India wants an amendment in WTO rules so that price support for public procurement to benefit low-income farmers or those who lack resources is considered ‘Green Box’ that are not subject to the cap of 10 per cent of agri production. Alternatively, it wants the subsidy to be calculated based on reference price of recent years and not the existing reference year of 1986-88.