New Delhi

India is set to challenge the status quo at the World Trade Organisation (WTO) by seeking the removal of entitlements in trading rules that have long favoured developed countries. According to reports, these entitlements have hindered the fair access of developing nations, creating friction and inequities in international trade.  

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A source familiar with the matter told Mint that India's stance will be made clear at the upcoming WTO inter-ministerial meeting in Abu Dhabi, where it will call for the removal of 'additional Final Bound Total Aggregate Measurement of Support (FBTAMS) entitlements'. 

Mint reported that India's proposal targets the 'de minimis limits', which dictate the minimal level of domestic support allowed for each country under the WTO Agreement on Agriculture (AoA). Currently, developed nations are permitted support up to 5 per cent of the value of production, while developing countries have a 10 per cent threshold. This longstanding disparity has fuelled debates and posed challenges, particularly concerning India's minimum support price (MSP) program for food grains. 

The source cited by Mint also emphasised India's position, stating, "India believes any negotiations on domestic support needs to first address existing asymmetries and imbalances in the WTO Agreement of Agriculture (AoA). Thus, discussing disciplines on domestic support for India must begin with the removal of historical asymmetries in domestic support."  

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However, India's call for change has not been without resistance, and negotiations on this issue have yet to commence in the WTO. According to the Third World Network (TWN), a think tank specialising in trade issues, disciplining FBTAMS entitlements is crucial as they remain "the primary source of inequity" in the AoA. TWN argues that allowing select countries substantial additional entitlements creates imbalances and policy advantages, further aggravating global trade disparities. 

As India pushes for a balance, its actions also draw scrutiny from foodgrain-exporting nations like the US and Canada, who question the subsidies provided under India's public stockholding (PSH) program, particularly for rice. India has invoked the 'peace clause' at the WTO multiple times for breaching the 10 per cent subsidy ceiling on rice procurement. In response, India has defended its position by highlighting that it mainly exports premium quality rice rather than common paddy, emphasising its contributions to the global demand for this staple. 

In parallel, The Print reported that India's export decisions in the past year have garnered international attention and raised questions about WTO compliance. Several countries have turned to the WTO to inquire about India's bans and restrictions on the export of wheat, rice, and onions. Japan, Switzerland, Canada, the UK, Australia, the EU, the US, and New Zealand have all sought clarifications on these decisions, underscoring the need for communication, notification, and consideration of their impacts. 

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Critics of India's export bans argue that they have caused international food prices to spike, leading to concerns of social unrest and political instability in Asia and Africa. Before the bans, India accounted for a substantial portion of global rice supplies, adding to the significance of its decisions in the global food trade landscape. While reasons for export bans were provided for some commodities, such as addressing rising food grain prices, others, like the restrictions on onion exports, remain unexplained. 

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