As key World Trade Organization (WTO) member countries converge in Marrakesh, Morocco, this week for a stock-taking meeting, India will focus on ensuring that a permanent solution on public stock-holding subsidies for food security is a central part of the agenda at the December ministerial meet in Buenos Aires.

“Individually and also as part of the G-33 coalition of developing countries, India will insist that a permanent solution on public stock holding be one of the deliverables in Buenos Aires as was promised at the Ministerial meets in Nairobi and Bali,” a government official told BusinessLine .

Trade ministers from a number of WTO member-countries, including Commerce and Industry Minister Suresh Prabhu, will brainstorm in Marrakesh this week to identify priority areas for the Buenos Aires ministerial.

For India and other G-33 countries with a large population dependent on agriculture, it is important that subsidies extended for public stock-holding programmes — in the form of minimum support prices to farmers — do not face penalties at the WTO.

At present, such subsidies are classified as trade distorting and capped at 10 per cent of production value.

Tough conditions

While India managed to negotiate a peace clause after the Bali meeting, which lays down that no action will be taken against it in case such subsidies breach limits, it is subject to a number of tough conditions which could render the clause ineffective.

“The peace clause was an important achievement for India. But it has too many conditions attached to it, including ones stating that such subsidies should not affect the food security of other countries and world prices, which could create a problem in invoking the clause. So, India necessarily has to have a permanent solution as promised,” according to a Delhi-based trade expert.

The G-33 group has proposed a permanent solution, but it has not been accepted by many members yet, including Australia, Russia, Japan and Thailand.

The G-33 proposed inserting a new annex (Annex 6) to the WTO Agriculture Agreement, to allow public stock-holding programmes to be exempted from a cap on trade-distorting domestic support, as long as they met the requirement to share information.

On the other hand, the EU and Brazil submitted an alternative proposal linking public stock holding to domestic subsidies. “India and the G-33 have opposed the proposed linking of public stock holding to domestic subsidies as they feel that the former is to be sorted out independently. New Delhi will keep maintaining this position,” the official said.

In the area of proposed disciplining of fisheries subsidies to check over-fishing, another identified deliverable for the Buenos Aires meet, New Delhi has sought special and differential treatment for developing countries and exemption for fishing within territorial waters.