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India Commerce Minister explains WTO stand
August 5, 2014, 9:36 am

India on Tuesday said its stand on public stockholding that saw it blocking the WTO global trade deal was owing to the resistance from developed nations that were unwilling to engage on the issue of food security.

“The apprehension of developing countries was that once the process of bringing the Trade Facilitation Agreement into force was completed, other issues would be ignored, including the important issue of a permanent solution on subsidies on account of public stockholding for food security purposes,” said Indian Trade and Commerce Minister Nirmala Sitharaman in New Delhi on Tuesday.

“A permanent solution on food security is a must for us and we cannot wait endlessly in a state of uncertainty while the WTO engages in an academic debate on the subject of food security which is what some developed countries seem to be suggesting before they are ready to engage on this important issue,” she added.

The Minister was clarifying India’s WTO stand in a statement to the lower house of the Indian Parliament on Tuesday morning.

New Delhi has a huge program for stockpiling food to feed its poor. The $20 billion scheme to distribute subsidised wheat and rice to 800 million people, backing an anti-malnutrition drive was implemented by the previous Indian government.

The current WTO norms limit the value of food subsidies at 10% of the value of foodgrain production.

New Delhi has said it will ratify the World Trade Organisation global trade treaty if the WTO assents to India’s demand for concessions on food subsidies.

The WTO trade facilitation agreement (TFA) is expected to boost world GDP by up to $1 trillion.

“Developing countries are finding themselves hamstrung by the existing rules in running their food stockholding and domestic food aid programmes. The developed world too had market price support programmes and was able to move away from such support – though not fully even now – because of their deep pockets. This is not possible for developing countries,” Sitharaman said.

The Minister also added that she is “confident that India will be able to persuade the WTO Membership to appreciate the sensitivities of India”.

The US has said India’s refusal to sign the protocol was a discouraging sign.

“Failure to sign the trade facilitation agreement sent a confusing signal and undermined the very image Prime Minister (Narendra) Modi is trying to send about India,” a US State Department official told reporters after Kerry’s meeting with the Indian Prime Minister last week.