Bali Outcome Not to Impact Food Security Plan: Sharma

By implication, India will have the flexibility of providing support to its farmers without the apprehension of breaching its World Trade Organisation entitlements

Published: 18th December 2013 11:06 AM  |   Last Updated: 18th December 2013 11:06 AM   |  A+A-

Commerce and Industry Minister Anand Sharma on Tuesday told Parliament that the outcome of the WTO meeting recently held at Bali will not impact country’s food security programme.

Developed countries like the US and Canada have raised concerns over India’s `1.2 lakh crore food security plan saying that the stock piling of food grains under the programme may distort global agricultural commodity prices.

Under the food security plan, the government will procure food grains from farmers at minimum support price (MSP) and sell at cheap rates to beneficiaries.

“...nothing in the aforesaid agreement impinges on our food security programme for the poor and vulnerable sections of society, which is very much part of our sovereign space,” Sharma said in a statement in the Lok Sabha.

Sharma said: “It (the Bali outcome) provides for an interim mechanism to be put in place and to negotiate for an agreement for a permanent solution for adoption by the 11th Ministerial Conference of the WTO (to be held in 2017).

“In the interim, until a permanent solution is found, members will be protected against challenge in the WTO under the Agreement on Agriculture (AoA) in respect of public stockholding programmes for food security purposes. It unambiguously stated that the interim solution shall continue until a permanent solution is found.”

There are apprehensions that once India implements its food security plan completely, it may breach the 10 per cent subsidy cap under the WTO’s AoA.

“By implication, India will have the flexibility of providing support to its farmers without the apprehension of breaching its WTO entitlements. It has also effectively led to a commitment from members of the WTO to work on a permanent solution as part of a post-Bali work programme,” Sharma said.

The MSP is deemed as support to farmers under the AoA. Under the current WTO rules, such support has to be kept within a limit of 10 per cent of the value of production of a product.

India has strongly demanded the amending of AoA as the rules for calculating the support are based on a reference price of 1986-88, without taking inflation into account.

On the trade facilitation agreement, Sharma said India’s proposals on customs cooperation and those relating to agri-exporters found acceptance amongst the WTO membership.

Sharma said: “A positive outcome at Bali has also strengthened the credibility of the WTO as an institution. We have been able to give a clear signal to the world that while India is prepared to engaged, it will not accept an unbalanced agreement.

“It will under no circumstances compromise the fundamental issues pertaining to food security, livelihood security and the welfare of its subsistence farmers and poor.

(With agency inputs)

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