Australia takes legal action against India over sugar subsidies

Australia today (16 November) announced that it is taking legal action against India at the WTO over sugar subsidies. It has alleged that India caused a ‘significant downturn’ in global prices of sugar and also disappointed Australian producers.

It claims that the subsidies that witnessed Indian sugar production leap from an average 20 million tonnes to 35 million tonnes in the current year far surpass the level of farmer assistance allowed under the WTO rules. The counter notification comes after Australia repetitively raised the matter with India directly.

Now the matter will be discussed at the WTO’s Committee on Agriculture meeting, which is scheduled to be held later this month.

Meanwhile, Australian Trade Minister, Simon Birmingham said it was time that India, world’s second-largest producer of sugar should be held responsible for its market distorting policies on sugar. He said, “We have raised our industry’s deeply held concerns on several occasions with senior levels of the Indian Government” but as the issue was not heard “We will now hold formal discussions with India and other WTO members regarding it at the upcoming WTO Committee on Agriculture.”

Birmingham expressed hope that India would reassess its position on what are more than dollar 1 billion in additional subsidies for sugar producers “that has pushed universal sugar prices to a decade low”.

The statement comes two days after Australian Prime Minister Scott Morrison met with Indian Prime Minister Narendra Modi in Singapore.