WTO review backs Centre move to cut farm subsidies

Tribune News Service

New Delhi, January 11

The World Trade Organisation’s review of India’s trade policies has expressed concern about the high level of government intervention in the agriculture sector.

Members recognised the importance of the sector in supporting livelihoods and food security.

At the same time, they urged India to reform its agricultural policies as they continue to be based on “significant levels” of domestic and export support for key crops, including through subsidies for certain crops such as sugar, and to inputs, said a summary report at the end of the review that has taken place after five years.

The three farm acts that are at the centre of the farmers’ agitation are also aimed at reducing government intervention in agriculture.

The review was skeptical about programmes such as ‘Make-in-India’ and ‘Self-Reliant India’ as well as preferences granted to local suppliers in the government procurement regime. Members welcomed these initiatives, while raising concerns about the possible trade restrictions they could introduce, urging India to be mindful of any trade implications.

It noted that India’s trade policy had remained largely unchanged since the previous review. There is continued heavy reliance on instruments such as the tariff, export taxes, minimum import prices, import and export restrictions, and licensing.

On tariff, concerns were expressed with respect to its complexity and uncertainty, the increase in tariff rates, tariff preferences, and tariff concessions.

At the same time, Members commended India on its strong economic growth during the review period, particularly in the services sector, allowing India to become one of the world’s largest economies.

Some members urged India to finalise ongoing regional trade agreement negotiations. They also encouraged India to consider simplifying its rules of origin requirements.

India came in for praise from some members for providing duty free and quota free access for exports.