WTO’s decision unlikely to affect India’s sugar exports

A World Trade Organization (WTO) panel has ruled in favor of Brazil, Australia and Guatemala in their trade disputes with India over sugar subsidies and asked officials in New Delhi to conform to global regulations. “We recommend that India bring its WTO-incompatible measures in line with its obligations under the Agriculture Agreement and the SCM (Subsidy and Countervailing Measures) Agreement,” the panel said. In the cases brought before the WTO in 2019, the three countries alleged that India broke WTO rules by providing excessive domestic support and export subsidies for sugar and sugarcane. The WTO panel said in a 115-page report that for five sugar seasons between 2014-15 and 2018-19, India provided domestic support to its sugarcane growers in excess of the maximum level of 10% allowed under the global agriculture deal. Did. It also said that India failed to inform the WTO committee of its sugar export subsidies, in violation of a separate agreement. However, the panel did not uphold Australia’s charge that India maintained buffer sugar stocks, which it should have reported to the World Trade Organization in the 1990s.

India’s Ministry of Commerce and Industry said in a statement that the panel’s report was “unacceptable” and would have no impact on ongoing Chinese policies. “India has taken all necessary steps to protect its interests and has filed an appeal against the report in the WTO, so as to protect the interests of its farmers,” the ministry said. India believes that its measures are in line with its obligations under WTO agreements, the ministry said.

Reacting to the ruling, the Indian Sugar Mills Association (ISMA) has said that the decision is unlikely to impact Indian sugar exports. In a statement issued here, Verma said the government has already stated that all the facts and figures submitted by the panel to the WTO panel have not been properly considered while deciding the grievances of Brazil, Guatemala and Australia. Therefore, the Indian government has already overruled the findings of the WTO panel and decided to appeal to the WTO appellate authority, he said.

“As soon as the Government of India submits an appeal to the Appellate Authority, the existing subsidy and domestic market support as per WTO rules may be continued till a final decision is taken by the Appellate Authority,” Verma said. He also pointed out that since there is no export subsidy for sugar, the order of the WTO panel with respect to Indian sugar exports has no effect. “Further, the export subsidy which was being given in the last few years is as per the provisions of Article 9.1 (d) and (e) of the Agriculture Agreement under WTO rules, and hence, Indian export subsidy on sugar is in full accordance with the regulations. and no changes may be required,” Verma said.

WTO regulations allow domestic market support for any commodity, including sugar and sugarcane, with the government providing market support of up to 10% of the value of the commodity. He said the government has repeatedly stated that the domestic market support on sugarcane is within the limits permitted by the WTO. Verma said that ISMA is confident that the current policies of the Government of India on the export of sugar and the subsidies given therein, which are being given in the last few years, are in accordance with the WTO norms and therefore, there is absolutely no impact on Indian will not have an effect. Sugar mills or sugarcane farmers.