India refutes New Zealand’s charge of fisheries subsidies breeding inefficiency

Fisheries subsidies such as sops for fuel, boat and gear, given by the Indian government, have come under fresh attack from New Zealand at the World Trade Organisation for allegedly encouraging inefficiency.

New Delhi, however, refused to take the criticism lying down and said these were policy issues and it was free to decide on how to moderate or reform its policy.

“The disciplines on fisheries subsidies are being negotiated and the kind of subsidies to be prohibited is a subject matter of discussion under the negotiating group on rules,” India said in its reply to New Zealand’s observations made at the group on subsidies and countervailing measures.

At the WTO’s Ministerial meeting in Buenos Aires in December 2017, members agreed to continue the fisheries subsidies negotiations and try and adopt an agreement by the next conference in 2019 on disciplines that prohibit subsidies that contribute to overcapacity and overfishing, and eliminate subsidies that contribute to illegal, unreported and unregulated (IUU) fishing.

New Delhi has been demanding flexibility in the form of special and differential treatment in the implementation of commitments as its subsidies to small fishers in the form of support for motorisation of fishing boats, fuel rebates and infrastructure support, all fall under the targeted subsidies list at the WTO.

New Zealand said in its submission to the WTO that it has been reported in the past that much of the rural economy in India, including coastal areas dominated by marine fishing, is lagging behind the rest of the economy. The fisheries sector is characterised by declining fish catches, depleted fish stocks, increasing conflict over fish resources, and mounting investment needs, particularly in the inshore sector.

“These factors are reported to trap the poor inshore fishers and processors into a cycle of perpetual low profits and debt, and some government welfare schemes such as fuel, boat and gear subsidies, may be encouraging participants to remain in a sub-sector that is already highly overcapitalised, particularly for inshore,” it added.

It further pointed out that India’s latest notification contains many of the same programmes included in its previous notification. “Can India explain what reforms it has underway to turn the fisheries sector into a sustainable and economic one, and reduce the reliance of the sector on government support?” it asked.

While affirming that such issues fall in India’s policy domain, New Delhi pointed out that the World Bank report of 2010 cited by New Zealand to support its observations on India’s marine economy primarily referred to the status of India’s fishing in its coastal waters and does not reflect the state of affair in the exclusive economic zone (EEZ) waters, which is within the sovereign rights of a country to carry out its fishing.

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