Contrary to whatever Union Commerce Minister Anand Sharma said
about the success of India at the WTO Ministerial in Bali, the actual picture is completely different picture.
India has wilted under pressure from the US and agreed to accept
conditionalities that were not part of the G-33 proposal. This is clear from
the text of the agreed draft.
What India has traded away:
1. Anand Sharma had unambiguously stated that the “peace clause”
should be in place till such time that a permanent solution is found. The word
“interim” that he had used is
in the text (a clear
victory), but in what is being described by the WTO Secretariat as
“constructive ambiguity” the US position that it should be only for four years
also finds its place (Para 1) in the text by adding, “for adoption by the
11th Ministerial Conference” (there is a WTO Ministerial once every two years
and Bali was the 9th Ministerial. (Some experts though are interpreting it as
being in India’s favour since “interim” can be interpreted as holding on till a
permanent settlement is found irrespective of the reference to the 11th
Ministerial).
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2. While India (G-33 draft) had demanded that no member-country
can drag a member-state to the dispute settlement mechanism, till a permanent
settlement is found under the Agreement on Agriculture (AoA) and the Agreement
on Subsisdies and Countervailing Measure (ASCM), only the AoA is mentioned in
Para 2. which means that member-states can still drag India to the dispute
settlement process under the ASCM. The language has also been whittled down and
instead of “shall not” replaced with “shall refrain from”, which means this
guarantee is not secure even under the AoA.
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3. Most disturbingly, this agreement is (Para 2) only “in
pursuance of public stockholding programmes for food security purposes existing
as of date”. This has the following implications:
(a) The Minimum Support Price Mechanism cannot be introduced for
crops other than those already provided for.
(b) The quantity of foodgrains procured under the MSP cannot be
increased beyond the procurement as of date which would threaten the NFSA in
the near future.
(c) Pulses, cooking oil and other foods (other than rice, wheat or
millets specified in the NFSA) can
no longer be introduced in
the PDS either by the Government of India or the State governments if they are
not being provided now.
(d) Future governments cannot increase the entitlements of
foodgrains guaranteed under the NFSA which has been notified. For instance,
Chhattisgarh, amongst other States, provides 35 kgs per household but no other
State which is now providing 20 kgs or 25 kgs can increase the quantity to 35
kgs.
(e) This may also be interpreted to mean that Government of India
or the State Governments cannot increase the price of the MSP from beyond
what has been specified now for the next four years.
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4. India will now be subject to requirements that have been made mandatory in the agreed text.
This was there in the US/ EU text but not in the G-33 proposal which means that
India has accepted to provide details of all holdings in procurement by both
the States and Government of India.
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5. India will also now have to notify that they have been
exceeding the de minimis level (10 per cent of agricultural
production as the permissible subsidy for developing countries). Para 3 (a)
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6. Para (4) is one of the most problematic propositions for India
which has made its way from the US/ EU draft, “shall ensure that stocks
procured under such programmes do not distort trade or adversely affect the
food security of other members”. This leaves open to interpretation that the
entire MSP mechanism that is in place for decades and India can be dragged to
the dispute settlement mechanism by the US alleging that the entire MSP
mechanism distrorts trade. So can Pakistan alleging that India’s rice exports
is distorting trade.
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7. This also means that even with the most generous interpretation
of this agreeement, India will still have to continue negotiations for the next
four years till a permanent settlement is done and we have to continue to agree
to further concessions to the US/ EU while this is being negotiated.
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8. In Bali, the African Group, many members of the G-33 and LAC
are very upset with India for having produced bilaterally with the US a text,
whereas till this morning, they were seeking the support of all the countries
for the G-33 and Indian position. Anand Sharma had taken a strident note till
last night, and raised the hopes of most developing countries that India would
not buckle to pressure from the US/ EU. Today his credibility and that of India
is severely eroded.
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Moral of the Story !!!!
As is evident, what is contained in the agreed text is a big
climbdown from what had been stated by Anand Sharma in his strongly-worded
statment. We have put at stake not just the interests of 650 million Indian
farmers but also every single one of the 820 entitlement holders under the
NFSA.
