India’s strong stand on food security at the World Trade Organization (WTO) has threatened to derail the first multilateral trade agreement reached in the last two decades. Developed countries have complained that India is going back on its promise made at Bali last December where it was agreed that the Trade Facilitation Agreement will be made a WTO rule by 31 July, while a permanent solution to the food security issue will be found only by 2017. India has maintained that different timelines for various elements of the Bali package is against the WTO rules of a single undertaking where everything need to be implemented simultaneously.
Mint takes a look at the logic of India’s position:
1■ -India’s complaint is justified. According to the WTO rule, public stockholdings must not exceed 10% of the value of foodgrains produced and calculated at the base price of 1986-88. You cannot calculate current food subsidy limits by 1986-88 prices. That beats all logic.
2■ For most of the developing countries including India, public stockholding for food security is a livelihood issue, a matter which should not be even debated at WTO.
3■ Developed countries lose nothing if they allow higher public stockholding by developing countries after putting in place a mechanism with reasonable limits to ensure developing countries do not dump their excess cereals at rock bottom prices in the international market.
4■ Allowing developing countries to continue to provide price support to their farmers will be a big confidence booster in multilateral trade, given that the focus of the ongoing Doha round of negotiations is supposed to be on “development”. Developed countries can claim moral victory and fast-track the remaining issues of the Doha round once they oblige the food security demand of the developing countries.
5■ Food security is the foundation upon which the United Nations’ Millennium Development Goals to eradicate extreme poverty and hunger stand. Forcing developing countries and Least Developed Countries to agree to anything which may compromise their right to food security will not only compromise basic human dignity but also go against the UN declaration to which all countries are a signatory.
6■ The government support to farmers in developed countries are way ahead of what developing countries can even afford to provide. For example, while India provides about $12 billion farm subsidy to its 500 million farmers, the US provides around $120 billion to its 2 million farmers. The figures could be contested, but not the trends.
7■ Lastly, there is wide realisation in India at the state and central government level about the rising burden of subsidies and there is a serious move to make it more targeted through the use of technology as in the case of the Direct Benefits Transfer programme. To expect it to happen at the pace developed countries wish means one does not understand the complexities of a country like India.