India is set to request the removal of certain entitlements in World Trade Organization (WTO) trading rules that have favored developed countries and impeded fair access to export markets for developing nations. Specifically, India will focus on the elimination of ‘additional Final Bound Total Aggregate Measurement of Support (FBTAMS) entitlements’ at the upcoming WTO interministerial meeting in Abu Dhabi. These FBTAMS entitlements provide additional allowances over the ‘de minimis limits’ defined in the WTO Agreement on Agriculture (AoA).
The ‘de minimis limits’ refer to the minimum amount of domestic support a country can provide without significantly distorting global prices. Developed countries have a de minimis limit set at 5% of the value of production, while developing nations have a limit of 10%.
India’s call for the removal of FBTAMS entitlements aims to level the playing field and address historical imbalances in domestic support under the AoA. The FBTAMS entitlements allow certain WTO members to provide support beyond the de minimis limits, granting them significant flexibility in offering product-specific support.
However, discussions on this issue have faced resistance, and formal negotiations within the WTO have not commenced.
According to the Third World Network (TWN), addressing FBTAMS entitlements is crucial as they remain a primary source of inequality in the AoA. The TWN argues that allowing substantial additional entitlements for a few countries creates significant policy advantages for them over other, often less affluent, nations.
This issue of entitlements also intersects with other negotiation topics, including public stock holdings (PSH) and special safeguard mechanisms requested by developing countries.
India has faced scrutiny from major foodgrain exporters like the US and Canada regarding its PSH program, with allegations of substantial subsidies, particularly for rice. India has utilized the ‘peace clause’ at the WTO multiple times due to exceeding the 10% subsidy ceiling on rice procurement.
India has defended its position by emphasizing that it primarily exports premium quality rice rather than common paddy acquired under the minimum support price (MSP) program.
The country, along with a coalition of developing and African nations, has proposed a permanent solution to public stockholding of foodgrains, aiming to grant them greater flexibility in providing farm support.
While India’s efforts reflect its concerns about agricultural imbalances and support for its farmers, negotiations and discussions within the WTO on these issues remain complex and challenging.
Queries directed to the commerce ministry’s spokesperson were unanswered at the time of reporting.
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