The Hindu Business Line : G-20 to prepare action plan against subsidised farm product exports

THE G-20 — an alliance of agricultural exporting countries in the WTO — has agreed, at India's request, to draw a strategy embodying the right of all developing countries to take remedial action against subsidised imports of farm products.

The Union Commerce & Industry Minister, Mr Kamal Nath, suggested this strategy at the meetings of G-20, G-33 and other key interactive sessions supervening in Geneva ahead of the Hong Kong Ministerial Conference of the WTO to be held in December this year.

As it is, the G-20 has finalised its proposals on market access and domestic support in agriculture and has presented them to the Trade Negotiations Committee (TNC) of the WTO. New Delhi believes that its proposals represent the true middle ground between the extremes of the US proposals on the one hand and the European Union and the G-10 proposals on the other.

Mr Nath articulated India's stated position that given the differences in tariff structures of developed and developing countries, overall proportionality in reduction commitments between the two could be achieved only if the thresholds, rates of cuts within a band and even the number of bands were different for developing countries vis-à-vis the developed countries.

The G-20 states in its proposal on market access that it recognises the need to safeguard developing countries' farmers against imports from developed countries benefiting from trade-distorting domestic subsidies. As such the developing world will have the right to have recourse to remedial action against such imports. G-20 would submit a proposal to ensure that right. Mr Nath said the defensive market access interests of India are fully reflected in the proposals.

On domestic support, the G-20 recalls that the Doha Declaration called for "substantial reductions in trade-distorting domestic support", referring to the huge subsidies doled out by developed countries to their farmers which distort and depress farm product prices in the global grain market to the detriment of farmers in the developing world.

As such, the G-20 has proposed that the bands and cuts for developed countries in respect of domestic support be thus: in bands or thresholds of over $60 billion, cut of 80 per cent; $10-60 billion, of 75 per cent; and 0-$10 billion. Further, developing countries without aggregate measure of support (AMS) entitlement (i.e., with AMS below the permissible limit of 10 per cent of total value of production) — like India — should be exempt from making reduction in their domestic support, since they are also exempt from making reduction to their de minimis.

On market access, G-20 proposal said that in line with the Doha mandate, "G-20 proposes that developed countries will undertake a formula cut of at least 54 per cent on average, while developing countries will be subject (to a lower cut) to a maximum tariff cut of 36 per cent on average".

In this context, the G-20 emphasises that "special and differential treatment for developing countries constitutes an integral part of all elements of the negotiation.

The G-20 is also determined to make operational the provisions in the Framework on S&D treatment for developing countries, in particular Special Products (SPs) and Special Safeguard Mechanism (SSM), so as to preserve food security, rural development and livelihood concerns of millions of people. ".

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