WTO Questions India on PMGKAY Extension and Rice Export Ban, Raises Concerns
Published on: December 3, 2023.
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India is facing questions from world leaders at the World Trade Organization (WTO) Committee on Agriculture (CoA) meeting regarding the compatibility of the five-year extension of the PM Garib Kalyan Ann Yojna (PMGKAY) free foodgrains scheme and the ban on non-basmati rice exports, according to a report by The Hindu Businessline.
Members of the WTO, including the United States, European Union, Canada, Australia, Switzerland, and New Zealand, have raised concerns about India’s minimum support prices (MSP) commitments and export restrictions.
India implemented a ban on the export of non-basmati white rice on July 20 this year in order to increase domestic supply and stabilize retail prices during the festive season. In response to questions raised at the Committee on Agriculture meeting in Geneva on September 27, Indian officials stated that the export ban was a method of regulation rather than a restriction. The officials emphasized that the ban was necessary to ensure food security for India’s 1.4 billion population. However, it is likely that the ban will be extended if domestic rice prices continue to rise.
Canada has specifically questioned whether procurement under the extended PMGKAY will be done at the administered price, which may affect India’s WTO domestic support commitments. Canada has advocated for procurement at current market prices to minimize trade distortions and has asked India to explain why they believe this method is more effective.
India has invoked the “peace clause,” which allows developing countries to exceed the subsidy limit of 10 percent imposed by the US and EU. This has raised questions about India’s decision to grant export quotas for non-basmati rice to certain countries after implementing the export ban.
Some media reports have indicated that there was sufficient rice supply to meet domestic demand at the time of the ban. As a result, the US, UK, and Switzerland have submitted reports asking India about the quantity of public stocks of rice that were considered adequate for domestic needs when the export restriction was put in place.
There are also requests for clarification on the expiry dates of India’s temporary farm-related measures, including export restrictions and duties, as well as the specifications and reasons behind the ban.
Source: Business Standard
