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India is under attack at the World Trade Organisation (WTO) for delaying its support to a pact on trade facilitation with 18 members objecting to its stance in a meeting in Geneva on Tuesday, and some even demanding that the agreement be signed within the next few days.
New Delhi, however, was unwilling to relent and reiterated that adoption of the trade facilitation text should be postponed until the end of the year till when a permanent solution on public stockholding should also be agreed.
“As many as 18 members including Japan, the US, Paraguay, the EU, Norway, New Zealand, Thailand, Pakistan, Mexico and Peru objected to the trade facilitation text being held up despite an agreement in Bali to adopt it by July 31 this year,” a person who attended the informal meeting of the WTO’s agriculture committee told BusinessLine .
Although, India agreed to support a protocol on trade facilitation — an agreement to smoothen movement of goods across borders by improving customs infrastructure and procedures — by July 31, 2014 in Bali last December, it had second thoughts as it felt that the deal was unbalanced.
The BJP-led Government, which came to power earlier this year, felt that it will not be able to use the interim relief granted in Bali against retaliatory action in case the country breached agriculture subsidy limits, as there were too many conditions attached to it.
It, therefore, pressed for a permanent solution to its food procurement subsidy problem simultaneously with the trade facilitation pact, and said it would not wait till 2017, as decided in Bali.
“While India’s food procurement subsidies do not breach the cap of 10 per cent of agriculture production for any category of foodgrains at the moment, if a permanent solution is not in place soon there is a risk that the country may breach it in rice within a few years,” a Government official said.
New Delhi wants WTO to consider all subsidies given for procuring food from the poor as non-trade distorting subsidies not subjected to caps. Alternatively, it could make the reference price for calculating such subsidies more realistic by pegging it to recent years.
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