Violations continue in India’s rice and wheat sector as WTO members start consultation process.
Current World Trade Organization rules allow governments to subsidize up to 10% of the value of commodity production; however, the Indian government continues to subsidize more than half of the value of production for several commodities, including rice and wheat. Reps. Tracey Mann, R-Kan., and Rick Crawford, R-Ark., led 12 members of Congress in sending a letter to President Joe Biden urging him to hold India accountable for violating their WTO commitments.
India’s lack of rule-following and the Biden administration’s lack of enforcement have reshaped the global agricultural production and trade channels by driving down prices, depressing production of rice and wheat commodities, and putting American producers at a disproportionate disadvantage, according to a release from the Congressional members.
“India’s practices are dangerously trade-distorting on a global scale and impact U.S. farmers and ranchers,” wrote the members. “We urge the administration to fil[e] a formal request for consultations with India at the WTO and to continue monitoring other WTO member’s domestic support programs that undermine fair trade practices.”
The letter notes at the recently held WTO’s 12th Ministerial Conference, a group of developing WTO members led by India proposed an unlimited allowance of trade distorting price supports tied to public stockholding and subsidies. “The proposal disregards WTO rules on agricultural domestic support partly put in place to ensure fairness of and confidence in the world’s farmers and instead benefits only a few countries. We share the agricultural industry’s concerns that if this proposal goes into effect, it could disproportionally disadvantage American producers who are already struggling.”
The Congressional members state they were glad to see that U.S. Trade Representative Ambassador Katherine Tai and her peers rejected India’s calls for a permanent, unlimited expansion of these limits and a subsidy exemption for commodities sold from government-to-government at MC12.
The members add, “America must not yield for the sake of reaching consensus. Instead, America must work to promote solutions that will alleviate the global supply chain and food shortages, and America must take actions that will address those consumers most impacted by inflation and rising food prices.”
Mann and Crawford also led their colleagues on a letter in January to Tai and U.S. Secretary of Agriculture Tom Vilsack urging them to hold India accountable under the WTO rules, particularly regarding wheat and rice production.
“We appreciate the recent letter urging the administration to push back against India’s trade distorting practices, which create unfair advantages for its domestic production and violate their WTO commitments,” says National Association of Wheat Growers Vice President of Policy and Communications Jake Westlin. “Wheat growers rely on open markets and fair trade to facilitate exports.”
