The draft agreement on agriculture being discussed at the WTO currently , while offering a peace clause of four years, does not link it conclusively to a permanent solution to the problem of food subsidies.

The Cabinet Committee on World Trade Organisation (WTO) will decide on Monday the country’s stand on the crucial issue of food security at the Bali Ministerial, which will be held the following week.

Indian negotiators are facing pressure in Geneva to accept a short-term relief (peace clause) from legal action against its food subsidies in case the country breaches the cap fixed by the WTO.

Once India’s food security legislation is fully implemented, it could exceed the limit of 10 per cent of total value of agriculture production unless the methodology for calculating the subsidies is changed.

New Delhi has been insisting that the four-year peace clause offered by developed countries giving it legal security against penalties should be linked to a permanent solution to the problem.

In fact, Union Minister of Commerce and Industry Anand Sharma, in his meeting with the European Commission Vice-President Joaquin Almunia on Friday, said that any agreement in the area of subsidies at Bali has to ensure that it does not come in the way of the food security legislation, which is an Act of Parliament.

No permanent solution

However, the draft agreement on agriculture being discussed at the WTO currently , while offering a peace clause of four years, does not link it conclusively to a permanent solution to the problem of food subsidies.

WTO members are trying to reach an agreement on a handful of issues, including farm subsidies, trade facilitation and matters relevant to Least Developed Countries at the Bali Ministerial beginning on December 3. The limited pact is expected to give a boost to the Doha Round of negotiations that has been stuck for over a decade.

amiti.sen@thehindu.co.in

(This article was published on November 22, 2013)
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