India won't back WTO trade protocol unless food security concerns addressed - Economic Times

NEW DELHI: India stuck to its guns at the World Trade Organization in defiance of developed nations with a strongly worded statement at the general council meeting in Geneva on Friday that it will not agree to any accord on trade facilitation unless food security issue is also taken up, signalling its intent to take a hard stand on July 31, the deadline by which a decision has to be made.

Instead, India has suggested a four-point action plan that seeks to deliver by December 31 a complete package on agreements reached at the Bali ministerial that includes trade facilitation, a package for least developed countries and public stocking for food security.

Rich rattled by India's stance

The hardening of India's stand emerged after the new government took stock of the situation earlier this week.

Rattled rich countries have hit back at India, accusing it of going back on what was signed in December 2013 at Bali, a charge India has strongly countered." The EU is not ready to renegotiate basic elements or timelines that were agreed as integral part of the Bali package," the European Union said, indicating a heightened risk of a stalemate or talks unravelling. Another delay looms, an expert said.

"WTO goes by consensus and with India along with the other African, Latin American countries not agreeing to sign the trade facilitation protocol, it will have to get deferred," said Biswajit Dhar, professor at the Jawaharlal Nehru University. It is by no means clear what will happen next, said a person present at the general council meeting, adding that the atmosphere was very tense.

"It will be suicidal, absolutely. And that's not a threat, that's just a statement of fact," one Western diplomat was cited as saying by Reuters. "They say we're going to get what we want or we'll blow everything else up, but if they do that they won't even get what they want." India said the concerns of poorer nations needed to be addressed.

"To fully understand and address the concerns of members on the TF (Trade Facilitation) Agreement, my delegation is of the view that the adoption of the TF Protocol be postponed till a permanent solution on public stockholding for food security is found," India said at the general council meeting, adding that that it was disappointed by the lack of similar urgency shown on issues of importance to the developing countries.The trade facilitation agreement seeks to cut down red tape in global trade that some studies say could add $ 1 trillion to the global economy.

At the Bali ministerial in December, WTO members had agreed to pursue trade facilitation, a solution to the issue of public stock holding for food security and a package for least development countries.

India's food security law, which is based on massive government procurement from farmers and distribution to poor at subsidised prices, runs the risk of violating WTO rules that prescribe a limit on farm subsidies at 10% of output.

The country has budgeted Rs 1.15 lakh crore for food subsidies in the current year.

"India is of the view that the Trade Facilitation Agreement must be implemented only as part of a single undertaking including the permanent solution on food security," New Delhi said in its submission, accusing the developed world of not having the "will to engage in areas of interest".

The G-33 countries, a group of developing nations, want a complete exclusion of subsidies given on account of public stockholding programmes from the category of actionable subsidies at the WTO. This will require amendment to the WTO Agreement on Agriculture to allow countries to procure food grain from poor farmers at minimum support prices and sell to poor people at subsidised rates through public distribution systems.

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