For a developing
country like India , where millions of people are loosing their life, becoming victims of malnutrition , stunting, and prone to other life threatening
diseases due to lack of 'food' , can there be anything more imperative than
ensuring access to food to all citizens in general and the poor in particular.
We ( Our Parliament ) did this humane act , making access
to food a legal right under the Food Security Act 2013 but now , due to our
prior commitments on International
platform ( WTO in this case ) ,
the implementation of this Food Act seems a distant reality.
Under the Agreement On
Agriculture signed in 1988, the member countries ( developing ) are bound to
restrict their domestic support also known as “Aggregate Measurement
of Support ” (AMS is the difference between the
Procurement price and a “fixed, external reference price” for a product, say
rice, multiplied by its total domestic production ) for agricultural products below 10 % of the
current value of production. Price support to farmers are considered trade and
production distortionary and comes under the category of Amber Box subsidies
i.e. to be reduced and as India attempts to implement the Food Security , there is little doubt that India will
breach this ceiling of 10 % and thereby , violating its commitments under the WTO Agreement on Agriculture (AoA).
WTO : Bali Round 2013
At Ninth WTO
Ministerial scheduled for next month in Bali , a continuation of Doha Round
2001 , for negotiations to facilitate the increase of global trade ,
India is sure to face resistance from the developed countries on its Food
Security Act. The developed country’s argument is that if the state agencies
start buying from farmers at well above international prices on a large scale,
then it acts as an implicit incentive to the local farmer to produce more and
that would squeeze out global grain suppliers leading to trade distortion.
India’s way out
India will have to primarily convince the members based on the following aspects :
· * The proposal, as mooted by G33 ,
to categorise higher-than-normal procurement prices — for the purpose of
ensuring food security — as a permitted agri-subsidy.
· * As the AMS rule is unfair because the “external reference price” is pegged to 1986-88
levels ( Wheat price Rs 354 per quintal ) , there should be a more recent base price to
arrive at cap levels.
· * India may invoke clause 18.4 of AoA which says “ due
allowance shall be given ‘‘ to the inflation factor while assessing whether the
MSP violates the AoA. And the actual inflation should be considered.
Peace Clause : A trap and
surrender of Indian sovereignty
The developed country’s offer
to accept the Article 13 of AoA is not a solution for a country like India
where Food is still the most desirable object .
It will impact India in two major ways:
· * Agreeing to peace clause will be an acceptance of the
notion of Food Security Act as market distortionary.
· * It will also be a surrender of India’ s sovereignty as
the Act is enacted by the Supreme Parliament with a vision to annihilate hunger
from the country.
· * After the peace clause gets over , it would be possible for
member countries to use WTO dispute settlement mechanism to challenge Indian subsidies , if not withdrawn by India
after four years.
We strongly believe that Indian diplomacy will
overcome this impediment , leading the developing countries , and ensure that
the legal right given to its citizen will not be compromised.
By - Shobhit Anand
By - Shobhit Anand
