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Issues Concerning India in WTO

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December 15, 2017

What is the issue?

11thMinisterial-level meeting of the World Trade Organization (WTO) has ended without solving India’s concerned issues.

What is ministerial level meeting of WTO?

  • It is the highest decision-making body of the WTO.
  • Under the Marrakesh agreement establishing the WTO, the Ministerial Conference is to meet at least once every two years.
  • The last Ministerial Conference took place in Nairobi, Kenya, in December 2015.
  • The Eleventh Ministerial Conference (MC11) took place from 10 to 13 December 2017 in Buenos Aires, Argentina.
  • The Ministerial Conference, was attended by trade ministers and other senior officials from the organization’s 164 members.

What are the higlights of the recent meeting?

  • WTO members launched the g7+ WTO Accessions Group(Group of seven leading industrial countries: Canada, France, Germany, Italy, Japan, United Kingdom, United States), a new platform designed to help post-conflict and fragile economies through WTO membership.
  • India’s expenditure on Food Subsidy which is capped by the WTO and later withdrawn, was a major point of discussion during the meet.
  • India for the first time submitted its formal documents opposing the inclusion of ecommerce in the list of negotiations to be held during the meeting.

What is India’s area of concern in WTO?

  • Matter of food stockpiles in developing countries is of particular interest to India, which has, through its poorly conceived public distribution system, created a vast stockpile of foodgrain.
  • Actions to add to or trade parts of this stockpile have big effects on world prices and thus can severely distort the market.
  • Developed countries such as the US, meanwhile, are unwilling to cede India and other developing nations the right to create a food stockpile through domestic procurement in perpetuity.
  • They argue that they are willing to make allowances for food security and thus accept the need for a stockpile, but not the need for exclusively local procurement to build that stockpile.

What are the actions taken by India to address this?

  • India has gone to successive WTO meetings with, essentially, a one-point agenda: To protect its procurement system.
  • India sees itself as a leader of the developing world in such fora, to seek to build its negotiating capacity.
  • India is also working to replace its policies perhaps with a form of income support for subsistence farmers so that they can gradually be weaned away from a dependence on wheat and rice that is straining the environment and distorting markets.

 

Source: Business Standard

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