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12th WTO Ministerial from June 12 to 15: India to push for fair, just outcome

To seek lasting remedy for food security, against narrow carve-outs in rules on food.

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Commerce and industry minister Piyush Goyal (PTI)

On the eve of the 12th ministerial conference (MC) of the World Trade Organization (WTO) in Geneva, India on Saturday said it will pitch for “fair, just and transparent discussions and outcome” at the multilateral body, amid persisting differences between the developing and the developed countries on a broad range of contentious issues.

The key areas of discussions and negotiations will include the 164-member WTO’s response to the pandemic, fishery subsidies, agriculture issues, including public stockholding for food security, reforms at the multilateral body and a moratorium on custom duties on electronic transmission, as per the commerce ministry.

For its part, New Delhi will push for a permanent solution to the issue of public stockholding of grains for its food security and strive to protect the interests of farmers and fishermen at the ministerial.

Commerce and industry minister Piyush Goyal will lead the Indian delegation for the ministerial, which will be held from June 12-15 after a gap of four-and-a-half years. The last ministerial at Buenos Aires in December 2017 had ended in a stalemate. The MC is the highest decision-making body of the WTO. India is not in favour of extending blanket exemptions from export restrictions under the aegis of the WTO on foodgrains purchased for the UN’s World Food Programme, as it would restrict its policy space to deal with domestic food security concerns, an official statement said on Saturday.

India’s persistent demand for a permanent solution to the issue of public stock holding (PSH) for its food security programmes assumes significance due to a food shortage in various parts of the world in wake of the Russia-Ukraine conflict.

Under extant PSH norms, a WTO member’s food subsidy bill should not exceed 10% of the value of production, based on the reference price of 1986-88. Under the PSH programme, the Indian government procures grains like rice and wheat from farmers at the minimum support prices (MSP), and distributes grains to the poor at a heavily subsidised rates, thus incurring a fat subsidy bill.

As it seeks a permanent solution, India is asking for an amendment to the formula to calculate the food subsidy limit and the inclusion of procurement programmes implemented after 2013 under the ambit of a peace clause.

Although India’s key procurement programmes are protected from penal provisions under the peace clause secured at the WTO’s Bali ministerial in 2013 (its permanent status was affirmed in late 2014). But some countries started making fresh demands on safeguards and transparency obligations after New Delhi invoked the peace clause for its rice procurement in 2018-19 and 2019-20.

New Delhi wants a lasting solution so that this protection under the permanent peace clause gets further bolstered and even if a member-nation reneges on its promise and complains about India’s procurement programme, the disputes settlement mechanism of the global body won’t consider its appeal.

Similarly, India will continue to work with allies to put pressure on developed economies, especially the EU, for an intellectual property rights waiver for Covid-19 vaccines, drugs and diagnostic devices to boost supplies to better fight the pandemic across the globe. The proposal–floated jointed by India and South Africa in 2020–has faced stiff resistance mainly from the EU, the UK and Switzerland, although the US, after initial reluctance, endorsed a limited waiver.

As negotiations for curbing fishery subsidies are widely expected to lead to an outcome at the 12th MC, India favours a 25-year exemption from over-fishing subsidy prohibition for developing countries that are not engaged in distant-water fishing. At the same time, it suggests big subsidisers abolish their doleouts within these 25 years, setting the stage for most developing nations to follow suit.

New Delhi believes that big subsidisers (advanced fishing nations) must take greater responsibility in scrapping their doleouts and reducing fishing capacities, in sync with the principles of “polluter pays” and “common but differentiated responsibilities”.

India will oppose any further extension of a moratorium on customs duty on electronic transmission, seeking a change in status quo prevailing over the past 24 years. A 2019 study by UNCTAD pointed out that developing countries are losing $10 billion in potential revenue annually, including $497 million by India, due to the moratorium.

WTO members have agreed not to slap customs duties on electronics transmission since 1998 and the moratorium has been extended periodically at successive ministerial conferences.

Amid persistent attack by the US on countries, including China and India, for “self -designating” themselves as developing nations at the WTO to enjoy special and differential trade benefits, New Delhi will stress that any reform agenda must be “development-centric” and bolster the provisions of special and differential treatment for poor and developing countries.

New Delhi will also call for expeditious restoration of the almost- dysfunctional appellate body of the WTO for dispute resolution, without diluting its core features. The US has blocked the appointment of judges, thus crippling the WTO’s appellate mechanism.

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