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India will prove at the World Trade Organization (WTO) that the allegations made by the US against it on under-reporting of minimum support price (MSP) for wheat and rice are baseless, a senior government official has said.
“The allegations (made by the US) are based on wrong and untenable assumptions. We will show that in the Committee on Agriculture’s (CoA) meeting when it takes up the US counter-notification for discussion,” the official told BusinessLine .
Exceeds Limits
US Trade Representative Robert Lighthizer and Secretary of Agriculture Sonny Perdue announced earlier this week that the country had submitted a counter notification in the CoA on India’s MSP for wheat and rice.
The US stated that based on its calculations, it appeared that India had substantially under-reported its MSP. It added that calculated according to the WTO Agreement on Agriculture methodology, India’s MSP for wheat and rice far exceeded its allowable levels of trade distorting domestic support (10 per cent of value).
‘Robust discussion’
The USTR said that it expected a robust discussion on how India implements and notifies its policies at the next CoA meeting, scheduled for June 2018.
“India has always followed the methodology for calculating MSP support diligently and nobody has had issues with the numbers before. We will gladly demonstrate to all members at the CoA that our statistics can’t be faulted at all,” the official said.
The US move does not have serious implications at the moment as it leads to a discussion on India’s notified data on agriculture subsidies between 2010 and 2013. “It is not the start of a dispute. It is just a discussion,” the official said.
The areas of potential concern identified by the US include the quantity of production used in market price support calculations, the exclusion of State-level bonuses from calculations of applied administered prices, exclusion from India’s notifications of information on the total value of production of wheat and rice and issues with currency conversions.
“Our notifications are totally transparent and provide all information that needs to be provided. India will be happy to answer all concerns raised by the US at the CoA issue-by-issue and establish that it has not flouted any norms,” the official said.
At the WTO, MSP is considered to be a trade distorting support which needs to be capped at 10 per cent of total output.
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