Examine the challenges before India at the WTOs Buenos Aires ministerial meet. (200 words)
Refer – The Hindu
Enrich the answer from other sources, if the question demands.
KS Abhinav 7 years
Please Review.
IAS Parliament 7 years
IAS Parliament 7 years
KEY POINTS
Challenges
· Agri-Subsidy Issue - There is a plan by Indo-China joint proposal with the backing of over 100 developing countries.
· This is to vouch for the elimination of trade-distorting farm subsidies worth $160 billion in several industrialised economies.
· This is seen as a prerequisite to address the prevailing imbalance in the WTO ‘Agreement on Agriculture (AoA)’, which unfairly benefits developed countries.
· Public Stocking - Countries like US & Canada insist on restricting public food grains stock-holding programs.
· They believe large public stock-holdings and subsidies like ‘Minimum support Price (MSP)’ & ‘Public Distribution System (PDS)’ will distort the market.
· But most developing countries (G-33 coalition) consider large stockholding is needed to strengthen their food security.
· G-33 coalition (Indonesia, China & India etc.,) is hence not willing to either restrict stocking or scrap subsidy programs for poverty-alleviation.
· Bali Peace Clause - While the stock-holding issue came up in the 2013 Bali WTO plenary, a temporary peace clause was agreed upon for 4 years.
· It said that, till 2017, no country would be barred from food security programmes even if the subsidy breached the limits specified by WTO.
· As a solution has not been reached yet, countries that have such food security programs face the risk of legal prosecution.
· EU & Brazil seem willing to endorse the G-33’s position on public stock-holding but, in return for support for reduction in trade-distorting subsidies.
· Fisheries Subsidy Issue - WTO is considering proposals on prohibiting certain fisheries subsidies as these led to over-capacity and overfishing.
· Many developing countries such as India and Philippines seek flexibility in granting subsidies.
· India provides subsidies in the form of support for motorisation of fishing boats, fuel rebates and infrastructure support.
· Notably all of this fall under the targeted subsidies list at the WTO.
· U.S. factor - U.S. is currently being piloted by an administration that seeks to undermine the WTO and is increasingly protectionist in its approach.
· U.S. is already exploring unilateral alternatives to the formal dispute resolution mechanism of the WTO to settle trade conflicts with partners.
