Economy

WTO: Australia, EU laud Modi govt’s flagship PM KISAN scheme

Amiti Sen New Delhi | Updated on June 27, 2019 Published on June 27, 2019

But members question other farm-sector schemes

The Narendra Modi government’s flagship scheme, the PM Kisan Samman Nidhi Yojana, which promises income guarantee to farmers, drew praise from Australia and the EU at the World Trade Organization (WTO). Both Australia and the EU said that such schemes should be expanded in India to cover more products.

However, the country’s other farm sector schemes such as the Transport and Marketing Assistance scheme for specified products, dairy policy, public stockholding of wheat and transparency with green box measures, came under attack from a number of countries at the recent meeting of the WTO’s Committee on Agriculture (CoA).

“Australia said, in contrast with its contentious pulses and sugar polices, India’s PM-KISAN income guarantee scheme is a welcome move, marking a switch from indirect income support to direct income support. It encouraged India to further expand such schemes to cover more products. The EU shared the view,” a Geneva-based trade official told BusinessLine.

PM-KISAN is a cash transfer scheme which proposes to give ₹6,000 to small and marginal farmers in three instalments annually.

“While the cash transfer scheme will help poor farmers live a better life, it is also essential for India to continue with its minimum support price (MSP) and other schemes for the agriculture sector as these address different needs of the poor farming community,” a government official said, adding that cash transfer schemes can’t replace all other schemes.

At the CoA meeting, India admitted the new Transport and Marketing Assistance scheme is an export subsidy but insisted that, as a developing member, it is entitled to continue such subsidies till 2023. “India’s TMA scheme was introduced in 2019, so it is in compliance with Nairobi Ministerial Decision on Export Competition,” India’s representative pointed out.

US subsidy package flayed

Several WTO members, including India, China, Australia and the EU, also targeted the US’two subsidy packages worth up to $28 billion announced recently and said they were worried that it might happen again in the future.

Australia said the amount of subsidies was equivalent to two-thirds of Australia's agriculture output and the US set a very “dangerous precedent” for its policies which risk distorting the global market.

Published on June 27, 2019
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