India is Seeking a New Standard for Agriculture Subsidies

According to official sources, India has asked the World Trade Organization (WTO) to revise the almost three-decade-old external reference prices of agricultural commodities that are used by the WTO to determine current domestic farm subsidies granted by developing countries.

While there was no progress on these concerns, WTO's recently finished 12th ministerial, as the attention was diverted to negotiations on reducing fisheries subsidies and a patent waiver for Covid vaccines, the global organization is expected to take up these matters soon at its agricultural meetings.

"These problems would be raised at every chance by India and other like-minded nations at the WTO," one of the officials said.

These countries mostly include the G-33 and other African states. For the first time, India has managed to bring together so many nations to submit a "harmonized document" on agriculture, putting up their united ideas.

As part of the long-term solution, developing nations are seeking protection from lawsuits over any food procurement or other support programs started after 2013 (when a peace clause for immunity was provided to them for current programs) and those that will be introduced in the future.

Significantly, any such sustainable solution, if agreed upon by all WTO members, will preserve the flagship PM-Kisan program, under which the government gives Rs 6,000 to every farmer yearly, according to a senior official.

In terms of calculating farm subsidies, New Delhi and others in the group argue that the current reference prices, which are based on a commodity's three-year average rate between 1986 and 1988, are excessively outdated. 

According to WTO regulations, developing countries cannot provide farm/food subsidies that exceed 10% of the production value of a commodity assessed using these out-of-date reference prices.

As a result, it significantly limits poor nations' capacity to provide substantial help to their farmers, while affluent countries continue to provide enormous farm subsidies under a distinct formula designed just for them. The amount of disparity between developing and rich nations' support was highlighted in a previous study jointly filed by India, China, and some other countries.