["India's stockpiling of food grains has led to questions from a few other grain exporters as they feel there is an implicit subsidy in the way India goes about it. As India is a large exporter of wheat and rice, other countries feel it hurts their farmers. "India got others to agree to a "peace clause" of four years, during which no one would formally raise disputes. In the interim, all countries would find a permanent solution to the problem." "At this point, for Narendra Modi government to go back and insist that both TFA and public stockholding should be seen as a linked deal is tantamount to a retrospective approach. Apparently, this is because India does not trust other WTO members to show a sense of urgency in dealing with the food grain stockpiling issue."
We must NOT bark up the wrong tree. As per the understanding reached at Bali a "permanent solution" (as regards "food subsidy", acceptable to all the parties involved) is to be found within four years and in the interim the present practice cannot be objected to. The TFA will come into force after that. Evidently, the TFA and the "permanent solution" are inter-linked. You just can't have the former without having achieved the latter. The Indian stand here is perfectly OK. Just because the corporates run media, who're utterly disinterested in the issue of food security for the millions, are railing against the stand taken does not mean that we'll have to mindlessly mimic them. Rather it's our job to ensure that the Modi government does not step back under external and internal pressures. Sukla] http://blogs.timesofindia.indiatimes.com/cash-flow/modi-government-takes-india-backward-at-wto-this-will-hurt-the-country/ July 26, 2014, 11:57 am IST Sanjiv Shankaran in Cash Flow | India Modi government takes India backward at WTO, this will hurt the country India has shot itself in the foot at the World Trade Organization (WTO) by trying to change the rules of the game after it has started. It almost seems as if we have a retrospective approach to areas besides tax. Last December, India joined other countries in reaching a trade agreement in Bali, the first since WTO was established in 1995. The highlight was a Trade Facilitation Agreement (TFA), which cuts down red tape. WTO estimates it will create 21 million jobs. Bali was important for India for another reason. India's stockpiling of food grains has led to questions from a few other grain exporters as they feel there is an implicit subsidy in the way India goes about it. As India is a large exporter of wheat and rice, other countries feel it hurts their farmers. India got others to agree to a "peace clause" of four years, during which no one would formally raise disputes. In the interim, all countries would find a permanent solution to the problem. Now, TFA is what most others are interested in. It is in India's interests too and it joined 150 plus countries in Bali in signing the deal. The agreement on TFA clearly specifies timelines. By accepting the Bali deal, India did concur with timelines, of which 31 July 2014 was the first one. The agreement on public stockholding has one timeline and that is cessation of disputes for four years. At this point, for Narendra Modi government to go back and insist that both TFA and public stockholding should be seen as a linked deal is tantamount to a retrospective approach. Apparently, this is because India does not trust other WTO members to show a sense of urgency in dealing with the food grain stockpiling issue. This will hurt India in terms of its reputation as a partner. A likely conclusion is that India is an unreliable partner as it is willing to renege on its commitment. If we do not trust other members of WTO, why sign up for it? This is not a case of sticking to one's principles, but that of an unreasonable trade partner. DISCLAIMER : Views expressed above are the author's own. On 26/07/2014, Sukla Sen <[email protected]> wrote: > [At this stage, it is rather difficult to gauge whether it is a case > of Hindutva driven "nationalism" taking precedence over (concomitant > and competing) commitment to radical economic neo-liberalism and > globalisation, or simply ministerial incompetence coupled with > over-dependence on the bureaucracy. > Or it's a calculated show of (empty) bravado before finally giving in. > > Utterly confusing and conflicting signals have emanated on the West > Asia policy as well. > The obstinate refusal of the GoI in Indian parliament to allow even a > hint of criticism against (the perceived ideological, political and > military) ally Israel stands in stark contrast with official positions > - essentially a continuation of earlier positions, at the BRICS > summit, the UNHRC and the UNSC.] > > http://www.firstpost.com/india/modi-sarkar-breaks-with-upa-policy-ends-up-scoring-self-goal-at-wto-1635761.html > > > *Modi sarkar breaks with UPA policy, ends up scoring self-goal at WTO* > > by MK Venu Jul 26, 2014 13:40 IST > > > The Modi government is facing diplomatic embarrassment because of its > latest negotiating stand at the WTO which boxes India into a corner with > countries like Venezuela, Cuba and Argentina even as some hitherto strong > and empathetic partners such as China, Brazil, South Africa and Indonesia > have distanced themselves from India by agreeing to move ahead with the new > trade facilitation agreement signed at the Bali ministerial meeting last > December. > > India has ended up creating confusion because it had also agreed to be part > of the global trade facilitation agreement (common customs governance > mechanism) at Bali on the explicit condition that the developed countries > will not interfere with India's massive food procurement programme until a > permanent solution was found to some unfair provisions within the WTO in > regard to allowing higher minimum support price to farmers. > > The patently unfair provision in WTO puts a permanent cap on the > procurement price the government can give farmers for its food security > programme. India had argued that there can't be a permanent cap on > procurement price as annual inflation must be adequately reflected in the > higher procurement price. If annual inflation is factored in adequately, > then India's procurement price is justified and well within WTO bounds. > India had made this argument in Bali and even had the sympathy and support > of the larger grouping of G-33 nations. Based on this argument the West, > led by the United States, agreed to find a permanent solution to this > problem in the next four years before the next WTO ministerial meeting. > This was discussed by the UPA government in Parliament in the presence of > opposition members like Arun Jaitley. The BJP agreed to the formulation > that we can go ahead and sign the trade facilitation agreement if India is > allowed to continue with its food procurement programme till a permanent > solution is found by the next ministerial meeting on how price paid to > farmers for procurement is fairly determined. > > However, the NDA government is seeking to bring about a substantive change > in that position by arguing India will sign the trade facilitation > agreement only if a permanent solution to food procurement is > institutionally initiated simultaneously. Since this is a somewhat new > formulation, India's erstwhile friends among the big developing economies > like China, Indonesia and Africa have moved away from us. > > PM Narendra Modi in this file photo. AFPPM Narendra Modi in this file > photo. AFP > > The commerce minister Nirmala Sitharam had some unpleasant exchanges with > the G-20 Chiarman in Australia last week who was summarising the collective > position of various countries on the trade facilitation agreement. The > Commerce Minister is believed to have briefed Modi on the matter after her > return. Simultaneously India's ambassador at the WTO secretariat in Geneva > has also taken the stand that trade facilitation agreement must be notified > simultaneously with the announcement of an institutionalised framework to > solve the procurement price issue. > > Basically, the Modi government now seems to indicate that India can't wait > for four years till the next ministerial meeting and wants some concrete > assurance now. > > This change of stand compared to what the UPA had proposed last December > has somewhat isolated India globally. But BJP can sharpen its domestic > political rhetoric saying it was acting in the interest of the farmers. > > Actually, Modi's explicit promise to Indian farmers in public meetings that > the government would ensure a 50 percent profit margin to them over their > total costs could be one reason why India is hardening its position at the > WTO. The Sangh Parivar could also have intervened to ask Modi not to make > any commitment at the WTO at this moment. > > Interestingly, Pakistan also had a massive food procurement programme but > it pays cash subsidy to farmers. Cash payment is allowed under the WTO > rules because it doesn't interfere with the market price mechanism. The NDA > can also use cash transfer as a possible bargaining lever at a later stage. > This could be another reason why Modi has reiterated his commitment to cash > transfer as a form of paying subsidy. > > > > -- > Peace Is Doable > -- Peace Is Doable -- You received this message because you are subscribed to the Google Groups "Green Youth Movement" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. To post to this group, send an email to [email protected]. Visit this group at http://groups.google.com/group/greenyouth. For more options, visit https://groups.google.com/d/optout.
